Thai Airways Faces Opposition to Adding Government Administrators
A proposal to add two government officials as additional plan administrators at Thai Airways International is facing opposition from the airline’s labor union and certain creditors. The proposal, which was expected to be approved at a creditors’ meeting on November 8, has now been deferred for further discussion until November 29.
The current plan administrators propose adding Pholjak Nimwattana, deputy director of the Ministry of Finance’s State Enterprise Policy Commission Office, and Panya Chuphanich, director of the Ministry of Transport’s Office of Transport and Traffic Policy and Planning, to oversee the airline’s business rehabilitation. However, the Thai Airways labor union and some creditors are concerned that this increase in government involvement could lead to political interference, especially in areas like aircraft procurement, which might undermine the airline’s independence.
The push for additional administrators reportedly comes from the Ministry of Finance, which holds 47.86% of Thai Airways’ shares and seeks to provide more expertise and government support in the airline’s restructuring. This shareholding will drop to 35.81% following a mandatory debt-to-equity conversion scheme.
Thai Airways has been under rehabilitation since May 2020 due to a debt of THB 245 billion (USD 7 billion), a situation exacerbated by the COVID-19 pandemic. The airline has shown signs of recovery, reporting a net profit of THB 12.483 billion (USD 360 million) for the three months ending September 30, 2024, driven in part by restructuring gains and favorable foreign exchange adjustments. Thai Airways also saw an increase in passenger traffic, with 3.94 million passengers flown during the quarter, up 20.5% from the same period in 2023.
As of September 30, Thai Airways operates 77 aircraft and achieved an average daily aircraft utilization of 13.1 hours during the third quarter. The airline’s fleet includes A320-200s, A330-300s, A350-900s, B777-200ERs, B777-300ERs, and B787s.
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Sources: AirGuide Business airguide.info, bing.com, ch-aviation.com