THAI:Faces early retirement?

[jpatokal]

Not yet official, but effectively confirmed:

http://airlineroute.blogspot.com/2008/06/thai-to-suspend-ny-nonstop.html

Ultra-long-haul flights aren't economic with current fuel prices, because a lot of fuel has to be spend simply on carrying the necessary fuel itself. Singapore Airlines opted for a different approach though: they're currently converting their A345s to business-only, which is more lucrative and lighter (less fuel) as well.

No word on what TG will do with their A345s after this, although speculation is that they will either add a stop at (eg) Tokyo or terminate service to NY entirely, focusing on LA instead.

[GWR]

THAI reaffirms 20 Airbus aircraft procurement


Thai Airways International Thursday reaffirmed its procurement of 20 Airbus A321-200 aircraft for domestic and regional routes.

Chairman Chaisawasd Kittipornpaiboon said the board acknowledged progress made on the general terms of agreement and the acquisition agreement, according to detailed discussions between the airline and Airbus.

The A321200 project documentation also received the board's approval and will be proposed to the Transport Ministry for submission to the Cabinet.

The Airbus A321-200 - a shorttomedium range, narrowbodied aircraft with a capacity of 179 seats - will replace some retired aircraft and accommodate more passengers.

The fuel efficient and environmentally friendly aircraft is expected to enter THAI's fleet from 2012 to 2017.

The Nation
http://www.nationmultimedia.com/breakingnews/read.php?newsid=30077807

[GWR]

Ailing THAI asks hundreds of staff to retire early

Thai Airways International Pcl has offered early retirement to 400 to 500 staff after notching up a second-quarter net loss of 9.3 billion baht ($276.8 million), the national carrier said Thursday.

President Apinan Sumanaseni said the airline's executive board had approved a budget of 700 million baht to encourage employees to opt for early retirement as part of its cost-cutting efforts this year, the Manager newspaper's website said.

On Wednesday, Thai Airways announced its second-quarter results, which were its worst performance in 10 years. The loss was attributed mainly to higher fuel prices.

Besides the staff cuts, Thai Airways also has announced the cancellation of several unprofitable routes, such as Bangkok-New York and Bangkok-Oakland.

The airline, however, has boosted its daily flights to Sydney and Melbourne to accommodate rising tourist traffic from Australia to Thailand. (dpa)

Link may expire:
http://www.bangkokpost.com/breaking_news/breakingnews.php?id=129621

[mdechgan]

Oakland? Oakland U.S.A.? or Auckland New Zealand? But I've been on those flights and they are packed. Leave it up top THAI to lose money on flights that are fully packed 100%.

[GWR]

Can't help thinking that it is extremely presumptuous of any local pol to think he is sufficiently-qualified to advise a major company:

Transport Minister instructs Thai Airways to improve efficiency after loss of 7 billion baht

Minister of Transport Santi Prompat (สันติ พร้อมพัฒน) stated that he has passed on new policies to the executives of Thai Airways Public Company Limited so that they may increase the efficiency of their services, especially concerning the adjustment of flight routes to coincide with rising fuel prices and increased competition. Mr. Santi expressed his belief that Thai Airways will be able to push through its current crisis despite experiencing a loss of 7 billion baht in the past 6 months.

Thai Airways Director President Flg. Off. Apinan Sumanaseni (อภินันท์ สุมนะเศรณ) also emerged to decline rumors that the company is preparing to lay off 500 employees. He stated that there is a project between the company and employees allowing them to voluntarily leave for personal reasons.
http://thainews.prd.go.th/newsenglish/previewnews.php?news_id=255108150002

[mdechgan]

As of October 26, 2008 THAI will cancel all Airbus A340-500 non-stop flights to LAX and replace them with a Boeing 777-200ER direct flight with a stopover in Narita, Tokyo to pickup Japanese Yen. THAI will no longer have any non-stop flights to the U.S.A with LAX being their only direct destination again.

I don't know what will happen with their brand new Airbuses which are very, very new. Their last A340-500HGW was only delivered last year. They will have their brand new multi million baht planes I think 4 of them parked and eating interest. There goes their return on investement.

Well hey, THAI should take one for the country for buying planes that aren't efficient and don't need for allowing lesser tariffs for EU shrimp imports from Thailand.

I've been on many of these flights and the non-stop flights were awesome. I was willing to pay more than take another airline for these non-stop A340-500 flights to LAX. It too bad they couldn't make use of it any better and turn it into a profit.

[jpatokal]

I don't know what will happen with their brand new Airbuses which are very, very new. Their last A340-500HGW was only delivered last year. They will have their brand new multi million baht planes I think 4 of them parked and eating interest. There goes their return on investement.
The planes have already been sold to TAM Brasil (http://www.flyertalk.com/forum/showthread.php?t=848840). (Almost certainly at a heavy loss though.)

I've been on many of these flights and the non-stop flights were awesome. I was willing to pay more than take another airline for these non-stop A340-500 flights to LAX. It too bad they couldn't make use of it any better and turn it into a profit.
The A340-500 was a bit of a lemon from day one, which was never able to carry as much pax/cargo as Airbus promised. Add in the huge spike in fuel prices and the fact that ultra-long-hauls need comparatively more fuel than one-stops, and they just couldn't be made profitable with TG's model of mixing economy and business class pax.

Singapore Airlines has taken a different strategy of converting their A345s into all-Business seating, which has high enough margins to keep the flights profitable. Website: http://www.a345business.com/

[mdechgan]

I just booked a ticket to LAX on TG.
I think they are stopping in Kansai again using B777-200ER.
Their price for standard economy round trip was 60,000 baht.

The next cheapest fare for other airlines was like 40,000 baht.
This was Korean Air. I assume other legacy airlines are about the same price and possible cheaper like with EVA, Air China, JAL, ANA.

I just don't see how they will fill up the seats if they are 20,000 baht over the competition for this route.

I just don't see how TG can overcharge their passengers like 20% over the competition's prices and expect full flights. I just don't get their business strategy.

If they don't get their act together I think this will be my last flight using TG.
The only advantage TG has left is because its THAI. The service, prices, even routes just aren't stacking up anymmore. I really like THAI airways but I don't see the advantages anymore.

Their planes are getting older A300-600, other airlines have better service like IFE and AVOD in economy while THAI doesn't, THAI's food is average at best. Other than their nonstop flight to Auckland (which might be a direct w/ technical stop soon) I don't see any other destination I would prefer using THAI. Even for Star Alliance members Singapore airlines which is only like an hour away is a very good substitute (they have a really good airport compared to our cobra swamp with cracked runways).
Even to Guangzhou which I fly regularly I can get a cheaper flight using China Southern with about the same service and flight time.

It looks grim for TG.

[jpatokal]

Other than their nonstop flight to Auckland (which might be a direct w/ technical stop soon) I don't see any other destination I would prefer using THAI.
The Auckland flight is also on the chopping block:
http://www.atwonline.com/news/story.html?storyID=13710

Pricing from Thailand will always be different, but from my viewpoint in Singapore, Thai's fares are often quite attractive. The only problem is that they're not the only game in town, which is why my last two longer flights (where I could have flown TG) ended up on Turkish and Lufthansa instead...