Thai Airways International Pcl said on Tuesday it is cutting its workforce by half and reducing its fleet size to become a more agile and efficient airline, as the troubled flag carrier submitted its turnaround plan, officials said.
The airline was in difficulty well before the coronavirus pandemic grounded flights across the globe, booking losses nearly every year after 2012, with a record loss of 141.1 billion baht ($4.66 billion) last year.
The carrier plans to maintain 13,000 to 15,000 employees on its books by 2025, acting president, Chansin Treenuchagron told a briefing, adding the move would make it more agile.
It currently has about 19,500 full-time employees, down from 28,000 in 2019, and expects 6,000 to leave the company by the end of this year.
These reductions are part of initiatives such as re-negotiating leases that will save the airline 52 billion baht by 2022, he said.
"Thai Airways faced problems from intense competition from low budget carriers, open skies policies and then the global pandemic," he said.
The announcement came after the airline last month cut 240 management positions and reduced supervisory levels from eight to five to increase efficiency.
Thai Airways plans also plans to reduce its fleet size to 86 aircraft by 2025 and halve the number of different aircraft and engines types to lower costs.
Its recovery plan submitted to the country's Legal Execution Department will need approval from its creditors and the Central Bankruptcy court.
Chansin said he was very confident that the revamp plan would receive creditor approval. "We worked very hard and closely together."
Creditors will meet on May 12 to decide on the plan, if it passes, it will be sent to the court, which will come to a decision around June or July, Chansin said.
The plan calls for capital raising or borrowing of about 50 billion baht for the airline's needs over two years so it would have liquidity as operations increase, vice president for finance Chai Eamsiri said.
There would be no haircut for creditors, but instead will extend repayment periods, he added.
Thai Airways previously said it would sell off non-core assets including four Boeing 737-400 engines, a training facility in Bangkok, shares in Bangkok Aviation Fuel Services Pcl and budget carrier, Nok Airlines Pcl, which is also undergoing a bankruptcy protected recovery.
($1 = 30.28 baht)