Thai Airways To Put Off New Plane Purchases Due To Its Poor Financial Performance

[Radar501]

Aww and i wanted to fly on the A380.

Singapore Airlines, Emirates can make your wish come true. For Thai, it's gonna be a long long time before you can step foot in one. Guess that there will be an extensive refurbishment of some older aircrafts..

Unless Thai Airways Intl have cancelled the order and paid compensation to Airbus, they will be taking delivery of an A380 in the Autumn. This photograph, taken in June at the Airbus facility in Hamburg, shows the aircraft after it had been painted and the cabin fitted out. So, your dream might yet come true.

FOR URGENT SALE

2012 model Airbus A380

Low k's

freshly painted

will trade for older aircraft eg Boeing 707 Douglas DC8

contact Chokchai Panyayong, President Thai Airways

[gdk]

Some middle east carriers have farang management with a proven track record and those airlines are doing well. This will never happen at THAI. Thai will always be run by sycophants who bow to their masters. Hundreds of Thais ncluding ex THAI execs and their families are eligible for free 1st and business class tickets.

I wouldnt be surprised if the top military brass and families travel free to Europe regularly and what about Thaksins family ?

when I remeber good years ago Thai was managed by a Scandinaian co

[Sam Drucker]

Can't blame an airline for recognizing that it cannot afford new equipment. It seems to me that the previous CEO was intent on the equipment purchase that would taken on so much debt that the airline would have collapsed, Can there be any doubt now that the airline did the right thing in sacking him?

Yes, indeed there can be doubt Mr. Kid.

The news story does not reveal one crucial point: the expected purchase announcement at this time involved Phase 2 of THAI's fleet development plan (Phase 1 was approved last year for aircraft deliveries between now and 2017, and is already committed.) Phase 2 involves aircraft for delivery from 2018 and several years beyond. So they're saying they're delaying a purchase committment for aircraft to be delivered 6+ years from now. It's also implied in the article that they may want to change the "mix" of aircraft they had previously decided on for this purchase, due to changing market conditions. It's a trade-off between committing years in advance to have the desired aircraft for your fleet in a changing market, and getting ahead of other airlines to get the proper delivery times from the manufacturers.

Claiming that they did the right thing in sacking Piyavasti is jumping to conclusions.

Edited July 30, 2012 by Sam Drucker

[SuneeTH]

Some middle east carriers have farang management with a proven track record and those airlines are doing well. This will never happen at THAI. Thai will always be run by sycophants who bow to their masters. Hundreds of Thais ncluding ex THAI execs and their families are eligible for free 1st and business class tickets.

I wouldnt be surprised if the top military brass and families travel free to Europe regularly and what about Thaksins family ?

when I remeber good years ago Thai was managed by a Scandinaian co

The only reason SAS was here, was to rob THAI dry.

[Lifer]

Does that mean we are flying on old outdated aircraft in need of repairs?

[saltandpepper]

Does that mean we are flying on old outdated aircraft in need of repairs?

No.

An old airplane is not an unsafe airplane

If the maintenance is made according to the international agreed standards, there is no safety difference between an old and a new airplane.

Features, comfort, technology can differ, but a certified plane can fly, as long as the company follows strict maintenance procedures.

[Ricardo]

Some middle east carriers have farang management with a proven track record and those airlines are doing well. This will never happen at THAI. Thai will always be run by sycophants who bow to their masters. Hundreds of Thais ncluding ex THAI execs and their families are eligible for free 1st and business class tickets.

I wouldnt be surprised if the top military brass and families travel free to Europe regularly and what about Thaksins family ?

when I remeber good years ago Thai was managed by a Scandinaian co

The only reason SAS was here, was to rob THAI dry.

After all, Thais have shown they are perfectly capable of running a profitable national-airline, based in one of the world's most-popular tourist destinations, so why would they ever have needed foreign expertise ?

[waza]

Can't blame an airline for recognizing that it cannot afford new equipment. It seems to me that the previous CEO was intent on the equipment purchase that would taken on so much debt that the airline would have collapsed, Can there be any doubt now that the airline did the right thing in sacking him?

I think you have got the fact wrong.

Didn't mark said something that his blue eye boy had turn TG from a big looser to one of asian biggest money maker in the past 2 years, hence the sacking was unjust?

Unfortunately, the losses incurred are public knowledge as TG is traded on the SET. Khun Abhisit got it wrong, but then he was never known for his management capabilities.

Well actually GK .............

Year over year, Thai Airways International Public Company Limited has seen their bottom line shrink from a gain of 14.7B to a loss of 10.2B despite an increase in revenues from 180.6B to 191.0B. An increase in the percentage of sales devoted to cost of goods sold from 76.84% to 83.80% was a key component in the falling bottom line in the face of rising revenues. http://investing.businessweek.com/research/stocks/financials/financials.asp?ticker=THAI:TB

Thai airlines is increasing it market share and turnover. The plan to purchase new, high efficiency aircraft which have vastly improved running and maintainace costs would have decreased bottom line costs and therefore overall profits.

[Mosha]

Actually, wouldn't they be better taking the NG aircraft, as they are more fuel efficient.

[ratcatcher]

Does that mean we are flying on old outdated aircraft in need of repairs?

No.

An old airplane is not an unsafe airplane

If the maintenance is made according to the international agreed standards, there is no safety difference between an old and a new airplane.

Features, comfort, technology can differ, but a certified plane can fly, as long as the company follows strict maintenance procedures.

Maybe if Thai Airways was to use high quality older equipment as you suggest and offer cabin crew that looks like these, it would make a ton of money.

http://www.forkparty...y-air-hostesses

BTW, nothing in here to make you blush.

[geriatrickid]

Does that mean we are flying on old outdated aircraft in need of repairs?

No.

An old airplane is not an unsafe airplane

If the maintenance is made according to the international agreed standards, there is no safety difference between an old and a new airplane.

Features, comfort, technology can differ, but a certified plane can fly, as long as the company follows strict maintenance procedures.

Except for one issue: Metal fatigue.

[geriatrickid]

If one looks at the aircraft industry newsfeeds;

Airlines are delaying deliveries of the new AB380 because of the wing cracks, with the EU approval for the proposed corrective measures outstanding. As the reports state, airlines do not want the new AB 380's until the issue is corrected as they don't want to pull the aircraft from service once put into use.

Also the AB 350's have a wing issue delaying production.

Boeing has an issue now that its B787 engine lost parts in flight and this will delay deliveries.

I expect that with Jet Airways on an expansion surge announcing a need for 100 aircraft, TG may be able to transfer some of its purchase contracts as Jet wants the equipment now.

[Lannig]

An old airplane is not an unsafe airplane

If the maintenance is made according to the international agreed standards, there is no safety difference between an old and a new airplane.

Features, comfort, technology can differ, but a certified plane can fly, as long as the company follows strict maintenance procedures.

Except for one issue: Metal fatigue.

If maintenance is done properly, metal fatigue is not a safety issue either because the maintenance checks include what's needed to detect it before it becomes an issue (borescope inspections). All recent crashes due to metal fatigue were due to improper aircraft maintenance, which obviously can lead to a whole variety of other failures.

[geriatrickid]

Some middle east carriers have farang management with a proven track record and those airlines are doing well. This will never happen at THAI. Thai will always be run by sycophants who bow to their masters. Hundreds of Thais ncluding ex THAI execs and their families are eligible for free 1st and business class tickets.

I wouldnt be surprised if the top military brass and families travel free to Europe regularly and what about Thaksins family ?

when I remeber good years ago Thai was managed by a Scandinaian co

The only reason SAS was here, was to rob THAI dry.

After all, Thais have shown they are perfectly capable of running a profitable national-airline, based in one of the world's most-popular tourist destinations, so why would they ever have needed foreign expertise ?

Hopefully, they will steer clear of US "expertise". A long succession of American management helped put AC into a descent into mediocrity and problems. The US airline industry has been characterized by horrible management. AA, UA and my beloved DL. I won't even mention the horrible US Airways. Not that the EU industry did any better with the ineptness at AF and BA. Even CX and SQ are having problems now. Airlines such as Emirates and Qatar have succeeded because they have not been burdened with the same labour regulations as other airlines, and have benefited from cheap fuel and indirect government support. And yes, their foreign executives are good. No denying that. However, it is easier to shine when not burdened with the same costs as airlines in the west.

[tavarich]

None of this is a surprise to me. Whenever I book a ticket in or out of BKK the Thai air ticket is always more expensive than any other airline I check into. The last time I was on Thai Air the food was horrible and the stews were not that friendly, and they didn't even have the entry exit document on the plane to fill in. Oh yea I also had to take a bus to the terminal when we landed.

[Nigel1500]

This is a common tune being whistled by airlines worldwide.

[fish fingers]

Poor financial performance...this is the acting President trying to justify why they sacked their last President. This is because he dared stand up to the Board who consist of mainly government officials. Everyone knows he turned around the companies ailing fortunes and restructured with a low interest loan which was to have bought a much needed new fleet and buying power. Without that loan in place, the company will suffer and I'll be too scared to fly in planes that are 15-20 yrs old.. what a shame.

Edited July 30, 2012 by fish fingers

[koosdeboer]

Does that mean we are flying on old outdated aircraft in need of repairs?

No.

An old airplane is not an unsafe airplane

If the maintenance is made according to the international agreed standards, there is no safety difference between an old and a new airplane.

Features, comfort, technology can differ, but a certified plane can fly, as long as the company follows strict maintenance procedures.

W

Except for one issue: Metal fatigue.

You are wrong, mr I know it all. With the right inspections and test equipment you will find problems in the airframe.

[Noistar]

If one looks at the aircraft industry newsfeeds;

Airlines are delaying deliveries of the new AB380 because of the wing cracks, with the EU approval for the proposed corrective measures outstanding. As the reports state, airlines do not want the new AB 380's until the issue is corrected as they don't want to pull the aircraft from service once put into use.

Also the AB 350's have a wing issue delaying production.

Boeing has an issue now that its B787 engine lost parts in flight and this will delay deliveries.

I expect that with Jet Airways on an expansion surge announcing a need for 100 aircraft, TG may be able to transfer some of its purchase contracts as Jet wants the equipment now.

Airlines are replacing aircraft because they are not fuel-efficient, not because they are 'old'. The high price of aviation fuel is why Airbus and Boeing are making the new generation of planes lighter to help with reducing fuel costs. (It is also the reason why aircraft can't spend time going round and round if there are delays at their destinations - they don't carry unnecessary amounts of fuel - another weight-saving initiative)

It often seems strange that seemingly 'new' aircraft are got rid of.

All airlines aim for a low 'fleet age'.

Regarding the A380 (I've not heard them referred to as AB380 until now), airlines are keen to get the planes delivered as soon as possible. They are flagship aircraft - witness Malaysia, Korea, Singapore and Emirates etc.

Existing aircraft will require 'downtime', yes, but new aircraft incorporate additional checks into the normal service cycle.

I know Qatar Airways are holding back from wanting their aircraft built, but I believe everyone else just wants them ASAP.

BA have just got their first one in the building phase.

So - A380's, A350's, B787's etc are what airlines need to compete. Old aircraft are a liability for financial reasons, certainly not safety reasons, and that's without the type of aircraft which low-cost airlines use.

How old is John Travolta's plane?

[apetley]

Some middle east carriers have farang management with a proven track record and those airlines are doing well. This will never happen at THAI. Thai will always be run by sycophants who bow to their masters. Hundreds of Thais ncluding ex THAI execs and their families are eligible for free 1st and business class tickets.

I wouldnt be surprised if the top military brass and families travel free to Europe regularly and what about Thaksins family ?

when I remeber good years ago Thai was managed by a Scandinaian co

The only reason SAS was here, was to rob THAI dry.

Thai bought out SAS in 1977 for a pittance.

Sent from my GT-I9003 using Thaivisa Connect App

[waza]

If one looks at the aircraft industry newsfeeds;

Airlines are delaying deliveries of the new AB380 because of the wing cracks, with the EU approval for the proposed corrective measures outstanding. As the reports state, airlines do not want the new AB 380's until the issue is corrected as they don't want to pull the aircraft from service once put into use.

Also the AB 350's have a wing issue delaying production.

Boeing has an issue now that its B787 engine lost parts in flight and this will delay deliveries.

I expect that with Jet Airways on an expansion surge announcing a need for 100 aircraft, TG may be able to transfer some of its purchase contracts as Jet wants the equipment now.

Airlines are replacing aircraft because they are not fuel-efficient, not because they are 'old'. The high price of aviation fuel is why Airbus and Boeing are making the new generation of planes lighter to help with reducing fuel costs. (It is also the reason why aircraft can't spend time going round and round if there are delays at their destinations - they don't carry unnecessary amounts of fuel - another weight-saving initiative)

It often seems strange that seemingly 'new' aircraft are got rid of.

All airlines aim for a low 'fleet age'.

Regarding the A380 (I've not heard them referred to as AB380 until now), airlines are keen to get the planes delivered as soon as possible. They are flagship aircraft - witness Malaysia, Korea, Singapore and Emirates etc.

Existing aircraft will require 'downtime', yes, but new aircraft incorporate additional checks into the normal service cycle.

I know Qatar Airways are holding back from wanting their aircraft built, but I believe everyone else just wants them ASAP.

BA have just got their first one in the building phase.

So - A380's, A350's, B787's etc are what airlines need to compete. Old aircraft are a liability for financial reasons, certainly not safety reasons, and that's without the type of aircraft which low-cost airlines use.

How old is John Travolta's plane?

The new aircraft also have greatly reduces maintainance requirements, so more hour in the air and a reduced maintainance budget and staff.

[onthemoon]

Some middle east carriers have farang management with a proven track record and those airlines are doing well. This will never happen at THAI. Thai will always be run by sycophants who bow to their masters. Hundreds of Thais ncluding ex THAI execs and their families are eligible for free 1st and business class tickets.

I wouldnt be surprised if the top military brass and families travel free to Europe regularly and what about Thaksins family ?

Back in England I have a Thai friend who lives with her mother in London. Her sister works for Thai Airways, entitling my friend and her mother to 6 free flights each per year. That's a very expensive perk offered by the company.

Thai Airways is a state owned facility. Thai government salaries are considerably less than the private sector. One way of compensating executives is to provide them with access to seats. Believe it or not, rhe seats are capacity controlled.

In respect to Thai employees having access to "free" flights, again this is in lieu of compensation. Thai pays its personnel in foreign markets less than its competitors. BTW, the tickets are not free. Personnel have to pay the taxes due on any ticket.

For comparison purposes; Air Canada's Travel Policy provides all employees with unlimited space available travel on Air Canada and Jazz flights throughout the network. In addition, employees are granted access and preferential rates on other carriers.

British Airways is just as generous; All BA employees, whether ground staff, cabin crew or pilots, are eligible for non-contractual travel perks, which take effect six months after joining the company. Staff, and their family, or a close friend, qualify for heavily discounted air fares. For example, they can get economy tickets at 10% of the fare (subject to standby). After five years of working for BA, employees get one allocation of free standby tickets each year. Depending upon seniority, the tickets can be upgraded.

How about a deep discount airline, like Easyjet? From their first day, staff can log onto a special website to receive discounted fares to Easyjet's network across 29 countries. On average, an Easyjet employee pays £25-30 per ticket each way. The unlimited travel is extended to workers' dependents and up to three "nominated companions". The tickets are not standby and staff can book flights up to three-months in advance.

Hm, are you talking about ID90? Every IATA airline sells tickets at 90% discount of the IATA ticket price to their employees and their direct family members. How does EUR 300 round-trip from Europe to BKK in First class sound to you?

I would think that many of the other discounts or free tickets you mention are quite normal in the industry. I used to fly AD50 and AD75 (agent discount 50% or 75% off the IATA rate), letting me fly in business class cheaper than any tourist in eco. And I wasn't even an airline employee...

[onthemoon]

Can't blame an airline for recognizing that it cannot afford new equipment. It seems to me that the previous CEO was intent on the equipment purchase that would taken on so much debt that the airline would have collapsed, Can there be any doubt now that the airline did the right thing in sacking him?

While I see your point, one of Thai's biggest problems is it's aging fleet. Competing airlines offer customers offer newer more modern planes. We have a Catch 22 situation here.

No profit without investment. As was mentioned earlier in this thread, newer planes are more cost-effective. Older planes do need refurbishing, as the seats in business class don't recline 180 degrees. TG needs to be competitive, and they can't do that without investing in the future.

[onthemoon]

Can't blame an airline for recognizing that it cannot afford new equipment. It seems to me that the previous CEO was intent on the equipment purchase that would taken on so much debt that the airline would have collapsed, Can there be any doubt now that the airline did the right thing in sacking him?

I think you have got the fact wrong.

Didn't mark said something that his blue eye boy had turn TG from a big looser to one of asian biggest money maker in the past 2 years, hence the sacking was unjust?

Unfortunately, the losses incurred are public knowledge as TG is traded on the SET. Khun Abhisit got it wrong, but then he was never known for his management capabilities.

Well, that's your opinion but not a fact. The losses before Piyavasti's changing the company around were much bigger, you fail to show the trend (how convenient). He was sacked because he talked straight instead of kow-towing.

[Thai at Heart]

Well, that's your opinion but not a fact. The losses before Piyavasti's changing the company around were much bigger, you fail to show the trend (how convenient). He was sacked because he talked straight instead of kow-towing.

http://www.etravelblackboard.com/article/127695/thai-cuts-exec-allowances-post-flood

He probably got fired because he cut the board's allowances. I mean whoever took 10k out of a pooyais pocket. "Its a slippery slope, next it will be 4 star hotels and we will have to pay for our own coffee"

Among the changes includes the cancellation of meeting allowances for those participating in Board meetings and other executive meetings this year while members of the Joint Management and Employee Relations Committee will also forego meeting allowances this year.

The carrier’s president, executive vice president and managing directors have all agreed to lose one month pay and signed to only 11 month pay for fiscal year 2012 while THAI officers will remain open for business during public holidays.

[Lannig]

Thai bought out SAS in 1977 for a pittance.

Huh? reference please? The Thai Airways site says:

On April 1, 1977, after a 17 - year capital participation partnership with SAS, the Thai Government bought out SAS remaining 15 % holding and THAI became fully owned by the Thai people.

which definitely not the same thing. They have bought back the 15% share that SAS was detaining.

Note: I love the "owned by the Thai people". How further away from reality could this be?

[Payboy]

Note: I love the "owned by the Thai people". How further away from reality could this be?

Key word being "the". :rolleyes"

[Noistar]

This bit of the article is interesting (IMHO)

"The purchase plan itself will still be submitted to the Cabinet for approval this month. Of the total, 38 aircraft will be bought for THAI and nine for low-cost subsidiary carrier THAI Smile. Under the revamped plan, the size and number of the new aircraft will depend on the destinations they are to serve."

Seems reasonable criteria for structuring the fleet. Buy them for the routes that make the most money

Begs the question, what were the previous criteria

cocoa time

[Thai at Heart]

Note: I love the "owned by the Thai people". How further away from reality could this be?

Key word being "the". :rolleyes"

But this is the absurdity of all these types of statements, not withstanding the fact that there are probably many millions in the country who have never ever set foot on a Thai Airways flight. Why doesn't the finance ministry buy a decent bus company like Nakornchai Air? We are so proud to be in complete ownership of a 2 and 1/2th rate airline, that no one would buy of us without the right to rip up its current business structure.

http://thai.listedco...reholdings.html

I wonder what is the total amount of taxpayer money that has been passed into Thai Airways over the years, in comparison with say, a given "populist" scheme under the current government?????

Edited July 30, 2012 by Thai at Heart

[Asiantravel]

Aww and i wanted to fly on the A380.

Singapore Airlines, Emirates can make your wish come true. For Thai, it's gonna be a long long time before you can step foot in one. Guess that there will be an extensive refurbishment of some older aircrafts..

And they are still one of the most expensive airlines.......... flying older planes.