Thailand’s Bangkok Airways downsizing fleet
Bangkok Airways (PG, Bangkok Suvarnabhumi) plans to reduce its fleet to 30 aircraft and may have to streamline its workforce further next year after a hoped-for THB5 billion baht (USD159 million) worth of soft government loans failed to materialise.
In an interview with the Bangkok Post, Bangkok Airways President Puttipong Prasarttong-Osoth said the fleet reduction would reduce the airline’s fixed costs by up to THB400 million baht (USD11.9 million) per aircraft per year. The fleet currently comprises fourteen A319-100s, nine A320-200s, and thirteen ATR72-600s, according to ch-aviation fleets advanced data.
The airline already cut its workforce by 30% during the pandemic.
Prasarttong-Osoth, who is also the president of the Airlines Association of Thailand (AAT), said despite many discussions, the government had not committed to any further financial support to the country’s airlines. Seven Thai airlines last year submitted requests for THB24 billion (USD718 million) worth of soft loans from the government only to reduce the proposed figure to THB5 billion after receiving a subdued response. “We do not expect to receive a soft loan from the government, and every airline has to find its own way to manage cash flows,” he said.
“From the government’s explanation, they cannot allocate soft loans to us because it might discriminate against other industries that also suffer from the pandemic. The THB4 billion (USD120 million) loans that Exim Bank [the Export-Import Bank of Thailand] has provided to us are ordinary loans with normal interest rates which still require collateral assets, which are not the conditions we requested,” he explained.
The company’s operating results for the third quarter of 2021 show a net loss of THB6.9 billion (USD206 million), mainly attributed to a one-off transaction terminating a lease agreement with the Samui Airport Property Fund, which amounted to THB5.4 billion (USD161 million), while the operating loss was THB1.2 billion (USD35.9 million).
For the nine months ending September 2021, the company’s total revenue was THB3.4 billion (USD101.7 million), a drop of 57.5% compared to the same period last year, resulting from an 88.3% decline in passenger revenue and airport business decreasing by 85%, Prasarttong-Osoth said.
Total revenue for the third quarter declined by 25.3% to THB672.3 million (USD20 million) compared to the same period last year. The downtrend resulted from a third COVID-19 wave in Thailand, combined with government-imposed travel restrictions from July to August 2021.
The airline began to resume domestic flights from Bangkok Suvarnabhumi to Koh Samui, Chiang Mai, Sukhothai, Lampang, and Phuket in September 2021.