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Airbus scales back in the UK and invests more in Thailand’s new aviation maintenance hub

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by Supalak Ganjanakhundee

Uncertainty over Thailand’s political situation is apparently less of a concern for Airbus than the political uncertainties in the UK with Brexit looming. Whilst Airbus is pulling out some of its manufacturing in Britain, the European consortium is now looking to Thailand for new maintenance and repair facilities to help service the rapidly growing ASEAN aviation sector.

European aircraft manufacturer Airbus, which first set up shop in Thailand more than 40 years ago, said the MRO (maintenance, repair and overhaul) sector offered enormous potential for the country’s aerospace business in the coming years.

France Airbus and national flag carrier Thai Airways International launched a joint venture for MRO facilities at U-tapao Airport last June. U-tapao is the renovated military airport now servicing the provinces immediately to the east of Bangkok, including the resort of Pattaya and the industrial provinces of Chon Buri and Rayong.

The MRO facility at U-tapao is part of the government’s Eastern Economic Corridor (EEC) strategy and enjoys strong support from the business community, which has called for its continued rollout after the March 24 election.

The MRO will be a key showpiece of the aeronautics industry in ASEAN, given the enormous growth of the local aviation industry and new routes being launched, many in and out of Thailand.

All those new aircraft require maintenance,” says Cedric Post, the French Aerospace Industry Association’s deputy director for European and international affairs.

“The in-service fleets in the Asia Pacific region will grow in size from 6,900 aircraft to over 20,000 in the next 20 years.”

“While other ASEAN members including Singapore have been in the MRO market for a long time, there is still room for Thailand due to its strong automobile and electronics manufacturing base.”

Singapore is short of land and costly while Thailand’s U-tapao Airport is large enough to serve current operations and expansion, Cedric said.

The U-tapao MRO centre will be one of the most modern and extensive in the region, offering heavy maintenance and line services, said Airbus head of marketing for Asia and North America, Joost van der Heijden.

“We will incorporate the latest digital technologies, specialised repair shops and a maintenance training centre,” he added.

“For Airbus, our MoU with THAI is about the opportunity to innovate and to lead the way in the aerospace sector.”

When fully operational, the U-tapao MRO centre is to offer heavy and routine maintenance for all wide-body aircraft types, specialised repair shops including for composite structures, as well as extensive maintenance training courses for technical personnel from Thailand and overseas.

Airbus and THAI are still working on the final details of the deal, while already partnering to address the MRO requirements.

“This will be a major new facility that reflects our confidence in Thailand,” said van der Heijden.

Airbus scales back in the UK and invests more in Thailand's new aviation maintenance hub | News by Thaiger

SOURCE: The Nation

 

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Business

Government will not re-capitalise struggling Thai Airways

Maya Taylor

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PHOTO: Wikimedia

The State Enterprise Policy Office says the government will not back a billion-baht cash injection for Thai Airways. The national airline is currently been dragged through bankruptcy proceedings.

Pantip Sripimol from the SEPO says the Thai Finance Ministry will not re-capitalise the carrier, although it remains its largest shareholder. The Bangkok Post reports that there are concerns Thai Airways could become a state enterprise once more if the ministry were to assume a majority stake once more.

Last September, the Finance Ministry reduced its stake in the national airline to less than 50%, in an effort to facilitate the debt-rehabilitation process. As a result, the carrier is no longer a state-owned enterprise and it’s understood a number of cabinet ministers are concerned that, should the airline regain its status as a state enterprise, the government would have to guarantee a billion-baht loan to ensure its survival.

The Bangkok Post reports that both the Finance Minister, Arkhom Termpittayapaisith, and Deputy PM, Supattanapong Punmeechaow, both support re-establishing the airline as a state enterprise. They argue that doing so would improve its financial situation and provide more leverage for negotiating with creditors. Such a move would mean the Finance Ministry becoming a majority shareholder once again.

As it is, the airline’s bankruptcy proceedings have been taken up with renegotiating with creditors – mostly aircraft lessees. The majority of Thai Airways’ fleet remains grounded and gathering dust, parked at Suvarnabhumi airport.

However, Pantip says the ministry will not re-capitalise the airline and is prepared to reduce its shareholding if other investors purchased additional shares. The ministry currently has a 49.9% stake in Thai Airways, with Pantip saying it would be difficult to justify a further cash injection to shareholders.

With the airline now operating as a private business, the government is no longer obliged to prop it up monetarily, nor is the Finance Ministry obliged to offer financial help to a private company, despite being its largest shareholder.

On Wednesday, creditors will meet to discuss the airline’s debt restructuring plan and decide if they are to accept it.

SOURCE: Bangkok Post

 

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Business

Thailand jumps on the electric bandwagon, aims to become EV production hub

Maya Taylor

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PHOTO: Flickr / JCT 600

The Thai government has ambitious plans to turn the Kingdom into a Southeast Asian hub for the manufacture of electric vehicles. Nikkei Asia reports that big companies in Thailand are preparing to invest substantially in the greener mode of transport, after the National Electric Vehicle Policy Committee suggested a new manufacturing target could mean half of Thailand’s auto-production is made up of electric vehicles by 2030.

The message to car manufacturers and energy suppliers is to grab this opportunity to invest in the necessary infrastructure to support electric vehicles, as the number of drivers using such cars is expected to rise significantly. The Thailand Board of Investment says that between 2017 and 2019, investment in EV production and its infrastructure reached 79 billion baht. That figure is expected to rise at a much quicker rate over the next 3 years.

According to the Nikkei Asia report, Toyota was the first car manufacturer to make EVs in the Kingdom, with Chinese manufacturers becoming more competitive in recent years. The latest Chinese firm to join the EV revolution is Great Wall Motor, which plans to launch electric vehicles this year. The number of EV manufacturers in Thailand is also growing, but Surapong Phaisitpattanapong from the Federation of Thai Industries’ Automotive Industry Club says they still need to overcome serious supply chain challenges. He says manufacturers of the traditional internal combustion engine now find themselves trying to supply parts for electric vehicles, including batteries, motors and converters.

“It’s all about the economy of scale. If the number of EV users goes up substantially, it would be worth investing, and everyone, including auto parts makers, would be ready to switch to producing EV parts, and that would create supply chains that are ready for the development of EVs, but it will take time.”

Surapong points out that the government hasn’t provided enough subsidies to encourage the purchase of electric vehicles, saying there needs to be more of an incentive to deliver the sales boost needed.

“We think there should be a more direct subsidy for EV buyers to promote EVs, but we haven’t seen the government issue any kind of subsidies like that yet.”

SOURCE: Nikkei Asia

 

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Coronavirus (Covid-19)

Pfizer sees 45% increase in net income and revenue, as critics point to disparity in global vaccine availability

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After seeing a 45% increase in net income from last year, Pfizer, the pharmaceutical giant, is largely increasing its projected profits for this year. And, the increase is undoubtedly due to the high amount of Covid-19 vaccine sales, in which the company says is shaping up to provide a “durable” revenue stream.

The company says this year’s first quarter profits featured almost 1/4 of sales coming from the Covid vaccines. As it is teaming with German partner BioNTech, the company is set to increase its vaccine production, putting it on track to see US$26 billion in revenues from the vaccine this year. The new number-crunching is an increase from the US$15 million that was projected in February of this year.

But the profits are triggering criticism as governments are feeling pressured to ensure vaccines are available in poorer countries. Chief Executive Albert Bourla, says the company is holding dialogues with “basically all governments of the world,” and it is awaiting approval from the US for 12 to 15 year olds to be able to receive the jab.

The company is also studying the efficacy of giving inoculations, or boosters, every 6 or more months after the second dose- in a move that signals even more profits on the horizon. Bourla says this scenario would allow the company to be both a leader and a financial beneficiary.

“It is our hope that the Pfizer-BioNTech vaccine will continue to have a global impact by helping to get the devastating pandemic under control and helping economies around the world not only open, but stay open.”

But last month, World Health Organisation chief Tedros Adhanom Ghebreyesus, cited a “shocking imbalance in the global distribution of vaccines” and emphasised that the WHO’s Covax programmes must be fortified soon to allow poorer nations to gain access to the inoculations.

Zain Rizvi, a law and policy researcher at progressive Public Citizen advocacy group, says Pfizer’s increase in profits show the need for governments to take action to save lives.

“Pfizer is cashing in on the crisis and hoarding technology, even as billions of people around the world go without a vaccine. Pfizer’s profiteering shows the urgent need for governments to step-in. Governments should require Pfizer to share technology with manufacturers around the world to help ramp up global production.”

Pfizer has defended its vaccine pricing policy, saying it has moderated the cost to encourage broad access through the pandemic phase that could continue into the year 2022. But with a net income increasing by 45%, at US$4.9 billion over the past year and revenues jumping the same percentage to US$14.6 billion, critics point towards the continued disparity of vaccine availability between poor and rich countries. Pfizer’s shares have also increased by .3% to US$39.95.

SOURCE: Bangkok Post

 

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