Will THAI's fortunes take off or falter?

Will THAI's fortunes take off or falter?

The past week has seen a lot of talk about how bad our national carrier Thai Airways International (THAI) has become over the past few years. Not many people realise that THAI's problems are not unique -- the global airline industry is facing the same challenges.

THAI, which is poised to report one of its worst losses in its 55-year history, has been criticised heavily by Prime Minister Prayut Chan-o-cha and by media outlets.

The airline that is saddled with huge debts and an array of different types of aircraft with many types of engines -- not to mention more than 25,000 employees -- would be tough for anyone to manage.

The man who is taking on the arduous task of restructuring the financially troubled airline is Harvard graduate and financial wizard Charamporn Jotikasthira who has had a successful run at Siam Commercial Bank Plc and as the head of the Stock Exchange of Thailand.

He took the helm as president of the airline on Dec 4 last year.

Within a year, the man who many thought would have been just like any other president of the behemoth has managed to achieve more than any of the previous presidents of the airline has done, I believe.

He has assured that he would cut the number of aircraft to eight types from 11 currently and that the size of the fleet would be reduced to 94 from 135.

All to be done within the next 34 days.

Sales of some of the fuel-guzzling aeroplanes such as the Airbus A340-500 have been pending for years.

But this time it is really happening.

Is this something we should not be proud of?

I, for one, would be more than happy to see the airline return to its highs once again.

As a frequent traveller on the airline I have seen its service quality and its aircraft deteriorate over the years.

Mr Charamporn, who has pledged to cut costs over the years, has said he would cut salaries and undertake voluntary retirement schemes for staff, something that would help lower the overall burden.

Some businesses such as catering and ground handling, for example, could be divested to people who have expertise in these areas.

All this in the name of getting the airline back on its feet as soon as possible.

But while all this is ongoing, the political noise seems to be rising.

The loudest and most powerful is coming from no other than the outspoken Gen Prayut who has been trying to play the "good guy" role in this whole saga.

Gen Prayut is correct to say that the problems of THAI are a lingering issue involving previous governments.

But he should also realise that the problems of THAI have been there for decades because people from political circles, including the military, have been at the forefront of the various problems that the airline today faces.

It is not uncommon to hear that state-owned organisations, such as THAI, PTT Plc and some state-owned banks are subjected to political intervention by the people in power, be they from civilian or military governments.

With the kind of power the military government has today, is it possible to invoke Section 44 to sort out the problems of this airline?

Mr Charamporn said the airline's management is going to take a pay cut to help cut costs. Should the staff do the same to save the boat from sinking? Instead, the prime minister reiterated that management needs to take a pay cut while the staff -- known for being highly paid but underworked in the bloated organisation --  should not be touched.

This has emboldened the labour union to come out and issue a warning against any measures that would hurt the employees. There have also been rumours of strikes. All this has made it all the more difficult for the management to do their job.

Let's face it. Political meddling for a long time is one of the main reasons why the national carrier is in a coma. Turning it around cannot be done overnight. It takes time. Those who show commitment to this difficult mission need support from the top, not discouragement.


Umesh Pandey is editor of Asia Focus, Bangkok Post.

Umesh Pandey

Bangkok Post Editor

Umesh Pandey is Editor, Bangkok Post.

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