August 25, 2008
Bangkok - As the oil prices soared, Thailand’s aviation industry felt the pinch more and more. Thai Airways suffered its losses while small airlines struggled to survive.
Thai Airways International blamed energy costs as well as a massive foreign exchange loss for its 9.23 billion baht (274.3 million dollar) loss in the second quarter which was the worst quaterly loss in a decade.
Its share value has dropped since March from 31.50 baht to 15.20 baht on Friday.
Thai Airways has continually raised its fuel surcharge which is at 90 dollars per passenger. The airline plans to ask about 400-500 employees to take voluntary retirement while trimming its long-haul flights.
It already cancelled direct flights to New York and made changes to its Los Angeles service.
Its low-cost sister airline Nok Air has even tried harder to deal with about 100-million-baht loss.
Suffering from its fleet expansion plan, Nok Air has cancelled its flying routes and adjusted flight schedules to match the demand.
Budget carrier One-Two-Go has already been forced to suspend its operations, saying fuel costs had forced the company to restructure its finances, according to AFP.
Thai Air Asia turned to focus on other sources of income such as in-flight food and drink sales, travel insurance as well as hotel deals and other services.
Being careful about its spending, the airline was still on track to add new destinations in Southeast Asia, according to chief executive Tassapon Bijleveld.
It is possible that more airline mergers and codesharing flights will take place in Thailand due to the energy situation and high competition among airlines.
