THAI sets B2bn 'retiree' plan
Thai Airways International Plc (THAI) has earmarked 2 billion baht for voluntary staff retirements this year as the airline posted a net loss of 13.04 billion baht for last year.
THAI president Charamporn Jotikasthira revealed that net losses were lower than the 15.6 billion baht in 2014 due to reduced fuel costs, curbs on expenses and foreign currency exchange gains.
Mr Charamporn said THAI will proceed with implementing its cost-cutting measures including a voluntary retirement programme to manage manpower affected by a reduction of flights and routes. About 2 billion baht has been set aside for the programme this year.
Last year, a total of 1,401 staff joined the programme which cost the company 3.38 billion baht.
He said total revenue was 192.6 billion baht -- 1.2% lower than last year mainly due to a 1.5% reduction in passenger revenue and 21% decline in cargo revenue.
The main reasons were a reduction in the fuel surcharge, a strengthening of the baht and fierce competition.
He said THAI has implemented the transformation plan since the first quarter of 2015 to curb losses by reducing flight frequencies, discontinuing non-profitable routes, cutting unnecessary costs and boosting revenue by adjusting its sales strategies and enhancing the competitiveness of its services. The transformation plan was approved by the State Enterprise Policy Committee on Jan 26 last year.
Mr Charamporn said the airline's five business units dealing with passenger services, ground service, repairs and maintenance, warehouse service and the airline's kitchen must come up with cost-cutting measures by comparing their management costs with those of rival airlines so the carrier can reduce its overall costs to compete with them.
He also said the cabin factor, or the number of seats sold out of the total number of seats available, is also forecast to rise to 80% in 2016 from 72.9% in 2015, as THAI plans to launch new routes to Russia, China and Southeast Asia this year, and resume flights to the US next year.
THAI is one of several state-controlled companies that have been undergoing an overhaul since the military seized power in May 2014.
Mr Charamporn said THAI received delivery of eight new aircraft and decommissioned 15 aircraft following the fleet strategy that cut its fleet to 95 aircraft, effective Dec 31, 2015, which was down from 102 aircraft in 2014.