Thai Airways has announced it will cut its workforce by half, and reduce its fleet by more than 20 per cent, as the airline slims down to navigate out of the COVID-19 pandemic.
In a submission to a Thai bankruptcy court, the airline has said up to 6,000 jobs will be slashed by the end of 2021, as the airline works to become more agile and efficient.
The carrier, which had a full-time workforce of 28,000 in 2019, intends to operate with a staff base of between 13,000 and 15,000 by 2025, according to acting president Chansin Treenuchagron.
It comes as the airline posted a US$4.66 billion loss in 2020 in light of the COVID-induced travel crisis, however the airline has struggled to achieve an underlying annual profit since 2012.
The workforce reduction plans join a number of cost-cutting initiatives in place, including the re-negotiating of aircraft leases, that together will see the airline save US$1.7 billion over the next two years.
The airline previously announced it had also cut around 240 management positions, and reduced the number of supervisory levels from eight to five, to increase efficiency and cut costs.
Thai will also be reducing its fleet size from around 100 to 86 over the next four years, and halve the number of different aircraft and engines it utilises, in order to lower ongoing costs.
The carrier also wishes to borrow or raise over US$1 billion to cover the airline’s costs for the next two years, and to free up liquidity as operations ramp up, according to vice president for finance Chai Eamsiri.
In addition, Thai Airways will sell off non-core assets, including four Boeing 737-400 engines, a training facility in Bangkok, its shares in Bangkok Aviation Fuel Services, and budget carrier Nok Airlines.
The airline’s restructure plan has been submitted to Thailand’s Legal Execution Department, to be put forward to the airline’s 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 reportedly meet on 12 May to make their verdict on the carrier’s proposed plan.
Should creditors agree, Chansin said the moves will be finalised by June or July.