Union slams THAI management over Bt6.3-bn 9-month loss

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THAI AIRWAYS INTERNATIONAL
Union slams management over Bt6.3-bn 9-month loss
Nongnapas Maipanich
The Nation


Ampon

Fix internal problems, don't hobnob with politicians, airline president urged

BANGKOK: -- The labour union of Thai Airways International has pleaded in writing to board chairman Ampon Kittiampon and president Sorajak Kasemsuvan that management come up with clear plans to improve the company's financial performance after it incurred a loss of Bt6.3 billion in the first nine months of the year.

The union will also submit the issue to Transport Minister Chadchart Sittipunt next week for his consideration.

"The loss that occurred over the first nine months is against the expectations of THAI employees, especially me, an aircraft technician," said Damrong Waikanee, president of the Thai Airways International Labour Union. "I have observed that over that period, every flight was almost full of passengers. However, the airline returned to loss amid claims by management that 17 aircraft had been delivered, resulting in a huge expenditure.

"The labour union takes the view that THAI's management needs to have a clear plan for bringing new aircraft into its service portfolio. Lacking such a plan means that management works without responsibility," he said.

Damrong said it should be observed that other airlines, such as Thai AirAsia and Nok Air, had achieved profits during this same period.

He added that the loss had damaged the morale of THAI employees, as they were concerned that it would mean no pay rises or bonuses for them despite their hard work.

"The employees have been seriously affected by the loss while the policy-makers, by which I mean the board of directors as well as management, which brings such policies into working procedures, have not suffered any impact," Damrong said.

"Recently a picture of Sorajak together with Thaksin Shinawatra, the former prime minister, appeared in the newspapers, resulting in dissatisfaction among employees towards such behaviour by Sorajak. Previously, the labour union urged the political sector not to interfere with Thai Airways. However, with this picture, it cannot being denied that the THAI president has become involved with politics," he said.

He added that what Sorajak needed to do during this time was to solve the internal problems of Thai Airways, not meet with such politicians.

Damrong said the union was concerned that listing Thai Smile on the Stock Exchange of Thailand to mobilise capital was like splitting THAI into many parts.

"If the government wants Thai Airways to have working flexibility, it should allow the airline to operate as a private enterprise," he said.

In the third quarter, THAI reported Bt51.3 billion in revenues, with a net loss of Bt6.1 billion. That compares with net profit of Bt1.8 billion in the same quarter of last year.

For the first nine months of 2013, THAI posted Bt156.9 billion in revenues, with a net loss of Bt6.3 billion. It posted net profit of Bt5.6 billion in the first nine months of last year.


-- The Nation 2013-11-30

[Thait Spot]

Is Thaksin's brother in law still on the board?

Sent from my Nexus 4 using Thaivisa Connect Thailand mobile app

[NongKhaiKid]

Hobbing with politicians in Thailand, well who would have thought such a thing ?

[chooka]

Thinking that if you are one of the most expensive airlines in the world will make you more money won't work.

if it is cheaper to ride in a nice new airconditioned Merc compared to a pedal powered tuk tuk then you know where the customers are.

[Shurup]

That's an easy one - someone stuffed their pockets real good, I don't see much improvements in the way THAI operates, but the opposite - upon arrival to Swampy from an international flight, they started parking their planes out on a field and and then everyone having to wait for the bus to get into the building. Been coming and going for over 5 years and until a few years ago, always used to arrive straight to the gates.

Come up with a plan to make profit, only means cuts in service and maintenance...

[PaullyW]

All the guys at my company, including me, stopped using THAI when they

1) became among the most expensive airline to many destinations (never the cheapest)

2) neglected to upgrade their planes with inseat entertainment on long haul flights (instead of their overhead TVs from the 1970s)

3) started parking their planes far away and requiring exhausted passengers to que up in the stunning tropical Bangkok heat to board hot-arse busses to be driven to arrivals (terrible and inexcusable).

The airline really does reflect the country and how backward most things are here. Quite an appropriate flagship airline in that sense.

[notmyself]

The problem is that people would rather pay more than fly with TAI

[JRSoul]

The problem is that people would rather pay more than fly with TAI

The problem is that people would rather pay much, much less than fly with THAI.

During their recent sale, I booked with AA my annual Visa-buy pilgrimage to Oz in mid-October. Surat-KL-Gold Coast for B3600 one way. I am more likely to sprout wings than I am to fly with THAI.

[ezzra]

You get to read often that THAI get new aircraft to use on their vast designations

routs, but somehow, when I fly with them to Australia I find my self sitting in an

old plane, why is that I ask?

[chooka]

You get to read often that THAI get new aircraft to use on their vast designations

routs, but somehow, when I fly with them to Australia I find my self sitting in an

old plane, why is that I ask?

Maybe it is just all spin to try and get customers in. I generally fly Singapore to Aust from Chiangmai. Have the gold card for Thai and can use Singpore to get points and when I have enough for the free flight on Thai then I fly with them.

[JoeThePoster]

They could save some money on paper cups if so many weren't used to prop up the individual inflight entertainment screens in business class.

[ginjag]

The union man said " near every flight was full " and they still made a loss.( most of these flights are over expensive) ??????

If the flights were less expensive or were on par with other airlines I wonder what the losses would be then ???

This airline wants privatizing -urgent. all the management and board slung out. Total restructuring needed urgent.

Like most government set-ups too many in the trough, free-be seats, what a waste of a once big flag carrier that I used most trips, only used Thai smile 1 time-BUT that was o.k. BUDGET AIRLINE ???? Udon to Swampy 2,800 bht one way STUPID--3 persons return near 17,000 bht. and they are running at a loss, the aircraft was 90% full. a bottomless pit comes to mind.

[Halion]

Thai airlines has become the laughing stock of local civil aviation owing to the greed and ineptitude demonstrated by it board and management. The national carrier is is similar plight to the national government.

[bonobo]

I am Star Alliance and my boss is a member of THAI's frequent flyer club, so we fly THAI often. Within Asia, we often have to change our plans as flights are overbooked. To Europe, the planes are often full, and I recently ran into the situation that I could not change my plans as THAI could not get me a different seat going back to BKK from Rome on the next two days due to overbooking. Yet, especially in Asia, THAIi prices are much, much higher (I just got a PAL ticket to Manila for 4,700 baht: the THAI was 17,000 +).

With full flights and higher prices, just how can THAI be losing so much when other airlines in competition with them are able to turn a profit?

[SOTIRIOS]

...it's called 'unchecked redirection of funds'.....it's not their money they are spending...but some are on the receiving end....just follow the money....

[waza]

Seems there has been a dramatic turn around in the fortunes of Thai airway since the dismissal of Piyasvasti Amranand......

Fired Thai Air CEO Blames Politics Over Business: Southeast Asia

"Piyasvasti oversaw a fleet modernization and cost cuts in 2009 that helped Thai Air rebound from its largest ever loss the year before to a record profit in 2010. The carrier slipped to another loss last year as fuel costs surged.......“Piyasvasti has done a great job, so there are concerns whether the new guy will be able to manage Thai Air as well as he did,” Sirima Dissara, an analyst at SCB Securities Co. in Bangkok, said yesterday by phone."

[ginjag]

Seems there has been a dramatic turn around in the fortunes of Thai airway since the dismissal of Piyasvasti Amranand......

Fired Thai Air CEO Blames Politics Over Business: Southeast Asia

"Piyasvasti oversaw a fleet modernization and cost cuts in 2009 that helped Thai Air rebound from its largest ever loss the year before to a record profit in 2010. The carrier slipped to another loss last year as fuel costs surged.......“Piyasvasti has done a great job, so there are concerns whether the new guy will be able to manage Thai Air as well as he did,” Sirima Dissara, an analyst at SCB Securities Co. in Bangkok, said yesterday by phone."

All I've seen re fuel costs that from the years ago HIGH fuel costs have not surged much. Every time an airline is in trouble they blame the FUEL costs, even if they are less. What about the fuel surcharge that was added years ago when a barrel of oil cost 140 D. now it's down to ??? so why isn't the surcharge dropped--or has it, we don't know as it's in the price of the ticket, same the mega security surcharge, that now has quietened down, the airport landing fees, etc. who knows what your paying for up and above your actual ticket price.

[Ricardo]

Seems there has been a dramatic turn around in the fortunes of Thai airway since the dismissal of Piyasvasti Amranand......

Fired Thai Air CEO Blames Politics Over Business: Southeast Asia

"Piyasvasti oversaw a fleet modernization and cost cuts in 2009 that helped Thai Air rebound from its largest ever loss the year before to a record profit in 2010. The carrier slipped to another loss last year as fuel costs surged.......“Piyasvasti has done a great job, so there are concerns whether the new guy will be able to manage Thai Air as well as he did,” Sirima Dissara, an analyst at SCB Securities Co. in Bangkok, said yesterday by phone."

IIRC he also had the support of the unions, who were unhappy when he was shown-the-door, indeed I'd doubt that anyone can turn round Thai without their full support.

As is now being demonstrated.

I myself used to fly TG every year between LHR & BKK, now I use other airlines at half the cost , and only use TG when I have Star-Alliance airmiles about-to-die. They're not even the best domestic-airline, that's Bangkok Airways, and are very average internationally.

[smedly]

so where is the money going ?

[tragickingdom]

Is that the same Union who demanded two days off to demonstrate and who threatens to cut the tyres of all airplanes if the govt disperses the protesters?

That Union can't possibly be concerned by any losses, their members will soon all be out of a job.

[steveyinasia]

I fly a lot on Thai and yes the flights are mostly full. With high prices and full flights, the revenues must be going to overpaid executives which is the story of nepotism in Thailand. People in high paid jobs because they are either related or know someone who can get them the job. Service on most flights is around meal service time, the rest of the time you rarely see staff, long haul flight s are only long for passengers, crew are in back chatting and sitting around. Customer service is joke, can never get them on the phone. Looking for Star Alliance options now.

[KIWIBATCH]

To many freebie seats on Thai for starters.....families of the board...Govt workers etc etc

..........BKK to NZ via Thai one way 46000 baht..............Don Mueang via Air Asia to Ozzie via KL then to (Brisbane)....45 minute wait in Brisbane then board an Air NZ plane to New Zealand...all in return ticket cost 34700 baht.....

Total elapsed travel time both on the ground and in the air using Air Asia 19 hours......using Thai 14

Ok so AA doesnt have all the bells and whistles on board.........but you can buy cheap enough food...and plug up your Iphone/pad.

I know as I have just completed the above leg on AA.

[steveyinasia]

I fly a lot on Thai and yes the flights are mostly full. With high prices and full flights, the revenues must be going to overpaid executives which is the story of nepotism in Thailand. People in high paid jobs because they are either related or know someone who can get them the job. Service on most flights is around meal service time, the rest of the time you rarely see staff, long haul flight s are only long for passengers, crew are in back chatting and sitting around. Customer service is joke, can never get them on the phone. Looking for Star Alliance options now.

[toolpush]

No kidding on the freebees for gov't officials and families of Thai Air executives. I have been flying back and forth BKK -PEK on a monthly basis for 9 years and during the last couple of years, most of the people in First Class and Business Class are free loaders. You can always tell by all the deep bowing and kow-towing by the Thai staff.

I also agree that the practice of parking on the tarmac and busing to the gate is a pain in the butt. Now we are doing it both ways. Busing out to the plane on the way to Beijing as well. Once a first rate airline (20 years ago). Now a second rate airline. They are fast becoming a third rate airline.

[user82374298374]

>>> 1) became among the most expensive airline to many destinations (never the cheapest)

Obviously, you don't have a very good travel agent.

>>> 2) neglected to upgrade their planes with inseat entertainment on long haul flights (instead of their overhead TVs from the 1970s)

Who actually uses the crap 'entertainment systems'? Bring your own content on a tablet or on your phone. The movies in the 'entertainment systems' are edited, the video is of poor quality, and so is the sound. Just how hard is it to download from iTunes or rip DVDs and copy them to your phone/tablet?

>>> 3) started parking their planes far away and requiring exhausted passengers to que up in the stunning tropical Bangkok heat to board hot-arse busses to be driven to arrivals (terrible and inexcusable).

The buses are not hot, they're chilly, with the typical Thailand full-bore cyclone air-conditioning. And the buses bring passengers very close to the Immigration checkpoints, saving a 1.5km or longer walk through Suvarnabhumi.

I fly all the time, and Thai Airways do a great job. They're much better than any US-based airline; the only complaint I have is that they nixed the 17-hour nonstop BKK - LAX route, which was super-convenient.

[Briggsy]

This is the posting of an accumulated and hidden loss from previous accounting periods to the profit and loss a/c in this period. Or an artificially inflated loss so that fake profits may be claimed in the future. Or a combination of both.

Let's say THAI makes 5 consecutive yearly losses of 50 million Baht. It pushes things around in the books and 'loses' 6 billion in one year thus allowing profits of approx 1.43 billion to be posted in the other 4 years.

Why would they do this? There are many reasons.

1. Director's bonuses. These are tied to profit. A place on the board of THAI is a political favour. Loads of prestige, free plane tickets, per diem, lunches but also cash. This is often tied to THAI making a profit and hitting targets. By pushing all the bad stuff into one year, these bonuses can be paid out.

2. 20% bad news and 80% good news is better than 100 % bad news. If THAI never made a profit, there would be calls for it to be privatised and the gravy train would be over. Politicians would be quizzed over wasting taxpayer's money.

3. Bad news can be timed. By deciding in advance, which year is going to be shown as loss-making, the whole event can be managed, by ensuring it happens when so-and-so is president, CEO, a board member etc, before or after an election, etc.

and so on.

[JRSoul]

To many freebie seats on Thai for starters.....families of the board...Govt workers etc etc

..........BKK to NZ via Thai one way 46000 baht..............Don Mueang via Air Asia to Ozzie via KL then to (Brisbane)....45 minute wait in Brisbane then board an Air NZ plane to New Zealand...all in return ticket cost 34700 baht.....

Total elapsed travel time both on the ground and in the air using Air Asia 19 hours......using Thai 14

Ok so AA doesnt have all the bells and whistles on board.........but you can buy cheap enough food...and plug up your Iphone/pad.

I know as I have just completed the above leg on AA.

Just to clarify, AA do not fly to Brisbane (BNE) but to Gold Coast (OOL). Doesn't matter to you in transit of course.

[JoeThePoster]

Turnaround plan:-

1 = hide the champagne behind tea on the serving tray

2 = lower quality of toothpicks from proper wood to recycled pallet shavings

3 = put "out-of-order" signs every alternate hour on coffee machines in the lounges

4 = reduce peanuts in packs from 8 to 5 & 1/2

Save whopping 10,420 baht per day. Yay, management perks and bonuses need not be touched!

[Prbkk]

THAI is clueless when it comes to running a business is a highly competitive industry. No idea about positioning itself. Premium product does not compare well with other carriers and the discount market is increasingly well-served by Air Asia, Scoot and the like. Even THAI staff joke about the pointy end being for employees or other hangers-on. Thai...smooth as burlap

[Moruya]

This hideous self serving bunch of teal leaves sacked the popular CEO of THAI and brought in not only yet another Thaksin acolyte but also installed Thaksin's wife's brother on the board as a retirement present.

The staff resent this and are now expressing their displeasure at the halfwits in the corporate cockpit.