Thai AirAsia X needs a major restructuring and new investors to prep the airline to resume international routes next year, after Thai AirAsia (TAA) already secured additional funding for the carrier last week.
Thai AirAsia X, a long-haul, low-cost carrier under the AirAsia group, has been grounded for almost two years since the pandemic emerged in 2020. The 11-aircraft fleet was reduced to seven earlier this year, said Tassapon Bijleveld, executive chairman of SET-listed Asia Aviation (AAV), the majority shareholder in TAA.
Mr Tassapon, also a shareholder in Thai AirAsia X, said the airline had to switch its wide-body Airbus A330 jets to cargo service to stem financial losses. Thai AirAsia X requires additional liquidity to prepare for passenger flights, which are expected to resume next year, he said.
Tourists have started asking when international flights will resume and the airline responded by launching ticket sales for the Bangkok-Incheon (South Korea) route from April 2022 in the hope that borders will reopen by then, said Mr Tassapon.
"Border closures should not be an option to prevent the spread of the Omicron variant as the national economy and cash-strapped tourism sector in particular cannot afford to survive another lockdown," he said.
Mr Tassapon said it has been over two years since the pandemic broke out and the government should learn to live with it by sourcing sufficient immunity, by using vaccines and medicines, for local communities in order to let economic activities run as usual.
He said Thai AirAsia X, which is not yet listed on the stock market, is in negotiations with a few potential investors and will enter the restructuring process by next year.
TAA was given approval by shareholders at a meeting on Nov 26 to commence the restructuring plan, enabling the airline to raise an additional 14 billion baht.
Under the new structure, Mr Tassapon will hold 18% of the shares, down from 40.52% at present, while AirAsia Aviation, the investing company under AirAsia Group Berhad, will hold 40.7%, followed by commercial banks at 5.3% and new individual Thai investors at 5.2%.
However, even though TAA is expected to receive the first allotment of fresh capital by mid-December, the cost-cutting measures have to remain until air travel fully recovers.
On announcing massive layoffs last month, Mr Tassapon said TAA would have to bid farewell to more than 400 employees from its total workforce of 5,000. Some employees decided to join the early retirement programme offered by the firm, he said.