Thai eyes return to profits with significant restructuring
Thai Airways International said it expects to return to profit earlier than expected in the fourth quarter and will cut 1,500 jobs this year as part of a restructuring plan at the troubled national carrier.
September 1, 2014
Thai Airways International said it expects to return to profit earlier than expected in the fourth quarter and will cut 1,500 jobs this year as part of a restructuring plan at the troubled national carrier. The loss-making carrier also said it would shed more than a quarter of its full-time employees by 2018, the first major job cuts announcement since the restructuring was approved last month. It’s not clear what impact the restructuring will have on Thai Cargo however.
Thai Airways had previously said it planned to cut costs and prioritise certain routes to return to profit as soon as the middle of next year. The airline, which employs 25,000 people and another 5,000 in subcontracted staff, was singled out as the first state enterprise to undergo reform by Thailand’s military rulers who took over in May after the ouster of Prime Minister Yingluck Shinawatra’s government over charges of corruption. Thai Airways has racked up four quarters of losses partly due to high operating costs.
“We expect to see profit in the fourth quarter,” Air Chief Marshall Prajin Juntong, chairman of Thai Airways and head of the military government’s economic affairs, told reporters in Bangkok. The airline aims to cut operating costs by four billion baht (US$125.5 million) and increase revenue by three billion baht, Prajin said, helped by an increase in the number of passengers flying to Thailand as the political unrest subsides.