BANGKOK / Bloomberg
Thai Airways International Pcl will continue to ground 10 Airbus A340s it hasn’t been able to sell because flying the four-engine planes isn’t worth it, even after fuel prices plunged more than 40 percent in the past year.
“The fuel consumption is so uneconomical,” Thai Airways International President Charamporn Jotikasthira said in an interview in Bangkok. “All new planes now have two engines that can fly as long as the four engines, with much better fuel efficiency.”
Besides trying to offload the planes, which were used previously for long-haul destinations such as Frankfurt, the money-losing airline has cut routes and sold assets to bolster its balance sheet and operations. Thai Air also aims to increase the portion of revenue from bookings on its own website to 30 percent in the next few years, from 16 percent now, Charamporn said.
“We still have a lot of unfilled seats, and need urgent action to spur demand for advance bookings,” Charamporn said at his office. “Promotions for bookings on our website are key to the company’s
future, because our current system is so inferior to other
The airline plans to introduce a new system in the second half of the year to make it easier and faster to book online, Charamporn said. It’s also in the process of selling its holdings in three domestic hotels, including publicly
traded Royal Orchid Hotel Thailand Pcl.
Shares of state-controlled Thai Air have fallen 11 percent this year, compared with a 15 percent drop for the Bloomberg Asia Pacific Airlines Index. The stock, which declined 37 percent last year, was down 1.2 percent to 8.20 baht as of 12:23 p.m. in Bangkok, poised for its lowest close since December 24.
“A swift sale of aircraft will offer much-needed funds for Thai Air to repay loans or make investments,” Siam Tiyanont, an analyst at Phillip Securities (Thailand) Pcl in Bangkok, said by phone. “Its goal for increased online sales is probably too ambitious, because a previous attempt delivered very slow results.”
Thai Air relies heavily on agents and tour companies for ticket bookings, making it harder for the airline to expand sales on its own website compared with budget carriers, Siam said.