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Company drafts THAI’s rehab plan, faces criticism

Caitlin Ashworth

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Company drafts THAI’s rehab plan, faces criticism | The Thaiger
PHOTO: Fifty Sky Shades
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The rehabilitation plan for Thai Airways International, or THAI, isn’t looking great. It was presented to the Central Bankruptcy Court yesterday and creditors questioned the expertise of the company chosen to draft the plan.

EY Corporate and Advisory Services, appointed by THAI, faced criticism regarding their technical experience when it comes to drafting a plan to restructure a company, especially one of THAI’s size. Thai PBS reports that a lawyer also brought up the company’s “questionable” track record when it administered a rehabilitation plan to another company that had filed for bankruptcy.

Acting president for THAI, Charnsin Treeuchagron, defended EY, saying it is a world class company. When it comes to lack of experience, Treechagron says airlines in Thailand have not filed for bankruptcy before, Thai PBS reports. The Bangkok Post reports Treeuchagron did not know EY had no experience as a consultant in rehabilitating a company the airline’s size.

The lawyer, who was not identified by Thai PBS, says the service fees charged by EY are unreasonable. An initial payment is planned for 22 million baht with 15 million baht payments each month until the court approves the plan.

Altogether, 16 creditors opposed the plan yesterday. Another hearing on the plan is set for Thursday.

SOURCES: Thai PBS |Bangkok Post

 

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1 Comment

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    Toby Andrews

    August 18, 2020 at 3:23 pm

    Let me guess what the rehab plan is.
    Is it default on all debts, and pay the management executives their handsome salaries to the very last moment?
    Thai airways appointed these EY advisers, so these advisers are not going to state sack all the executives without redundancy payments, and appoint a new management team.
    EY Corporate then would not receive their fee of 22 million baht.
    Of course the creditors are complaining. The EY Corporate will give advice to the advantage of the Thai management, and not the creditors.
    EY Corporate are paid by Thai Airways.

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Caitlin Ashworth is a writer from the United States who has lived in Thailand since 2018. She graduated from the University of South Florida St. Petersburg with a bachelor’s degree in journalism and media studies in 2016. She was a reporter for the Daily Hampshire Gazette In Massachusetts. She also interned at the Richmond Times-Dispatch in Virginia and Sarasota Herald-Tribune in Florida.

Business

Thai Vietjet introduce new “Deluxe” product for domestic routes in Thailand

Maya Taylor

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Thai Vietjet introduce new “Deluxe” product for domestic routes in Thailand | The Thaiger
PHOTO: www.vietjetair.com

Thai Vietjet, which currently operates 13 domestic routes within Thailand, is launching a new “Deluxe” product, starting from 999 baht. The “Deluxe” tickets will include 7 kilos of carry-on and 20 kilos of checked luggage (currently an additional charge), as well as seat selection and priority check-in. Date, route and flight changes are also permitted 1 time, free of charge.

Deluxe fares are available for travel between October 6 and December 31, excluding public holidays, on all domestic routes operated by the carrier. The 999 baht price tag does not include taxes and fees. Thai Vietjet is adding a number of new routes to its current network, including Chiang Rai to Hat Yai from November 1, and Bangkok Suvarnabhumi to Hat Yai, Khon Kaen, Nakhon Si Thammarat, Ubon Ratchathani, and Surat Thani from November 4.

The airline’s full network of domestic routes can be viewed at www.vietjetair.com. It also operates a number of international routes between Thailand and Vietnam and between Thailand and China, but not at the moment.

SOURCE: Chiang Rai Times

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Economy

Vietnam’s booming manufacturing sector reduced to a trickle as world pandemic kills demand

The Thaiger

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Vietnam’s booming manufacturing sector reduced to a trickle as world pandemic kills demand | The Thaiger

Vietnamese finance officials are downgrading expectations for a recovery of the south east Asian nation’s economy in 2021. The normally fast-growing gross domestic product in 2020 has stalled due to a huge drop in local and global demand, and the absence of international tourism. The booming economy, growing at an average of 6% per year since 2012, will struggle to reach a growth rate of 2% this year.

Fuelled by manufactured exports, the Vietnam economy has dropped back to a trickle. The Asian Development Bank estimates that this year’s GDP growth could be as low as 1.8%. The Vietnamese factories, that usually crank out shoes, garments, furniture and cheap electronics, are seeing dropping demand as the world’s consumer confidence drops dramatically.

Stay-at-home rules in Europe and America are keeping are keeping people away from retail stores. And despite the acceleration of online retail, many of the consumers are emerging from the Covid Spring and Summer with vastly reduced spending power.

The headaches of 2020 are also challenging Vietnam to maintain its reputation as south east Asia’s manufacturing hotspot. Rising costs and xenophobic foreign policy have put China ‘on the nose’ with some governments, complicating factory work in China, whilst other south east Asian countries lack infrastructure and are incurring higher wage costs.

One Vietnamese factory operated by Taiwan-based Pou Chen Group, which produces footwear for top international brands, has laid off 150 workers earlier this year. There are hundreds more examples of the impact of falling demand in the bustling Vietnamese manufacturing economy.

Vietnam’s border closure is also preventing investors from making trips, setting up meetings and pushing projects forward. Those projects in turn create jobs, fostering Vietnam’s growing middle class. Tourism has also been badly affected by the restrictions on travel. “International tourism is dead,” says Jack Nguyen, a partner at Mazars in Ho Chi Minh City.

“Inbound tourism usually makes up 6% of the economy.”

“Things will only pick up only when the borders are open and there’s no quarantine requirements. Who knows when that’s going to be.”

A mid-year COVID-19 outbreak in the coastal resort city Danang followed by the start of the school year has reduced domestic travel, analysts say. Some of the country’s hotels are up for sale as a result.

“Recovery could take 4 years.”

The Vietnamese Ministry of Planning and Investment is now warning that global post-pandemic recovery could take as long as 4 years, perhaps more.

Not that foreign investors in the country are pulling out. Indeed, many are tainge a long-term view that Vietnam’s underlying strengths will outlive Covid-19. Vietnam reports just 1,069 coronavirus cases overall.

SOURCE: VOA News

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Thailand

Thai Air Asia returns to Suvarnabhumi in addition to its Don Mueang hub

The Thaiger

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Thai Air Asia returns to Suvarnabhumi in addition to its Don Mueang hub | The Thaiger

Thai AirAsia is spreading its Bangkok wings and opening up a secondary hub at the main Suvarnabhumi airport (BKK), to help broaden its attraction and bolster its bottomline. Thai Air Asia was the first airline to head back to the moth-balled Don Mueang in 2012 to re-establish the older airport after all the airlines moved across to the new Suvarnabhumi and discount airlines were seeking a lower-cost base.

Although Thai Air Asia carried 22.15 million passengers last year, this year’s total will fall a long way short, just 6 million for 2020 up to date. Under the new set up, Thai AirAsia will have resumed nearly 90% of its pre-Covid domestic services, a total of 109 daily flights to 39 destinations. There will be 97 flights from Don Mueang Airport and 12 from Suvarnabhumi Airport.

With only a handful of international traffic, Suvarnabhumi officials are keen to re-kindle revenue for the massive airport and have struck a deal with Thai Air Asia to trial operations from BKK. They will be the only domestic carrier to operate flights from the two airports.

If the 2 month trial at Suvarnabhumi is successful, Thai AirAsia plans to add another plane to the BKK fleet by the end of the year. At this stage the trial is only approved up to the end of November.

Thai Air Asia have been concentrating on their ‘bus’ model to ferry passengers from the terminals to their aircraft waiting on remote airport aprons, and visa versa, to avoid some of the landing charges and using the sky-bridges. Some passengers have been complaining about the long trips in crowded buses, wild rides and over-enthusiastic air conditioning, whilst being told to strictly adhere to social distancing.

This week the Malaysian parent company Air Asia, announced the introduction of a ‘super app’, in an attempt to off-set the significant financial losses brought about by the Covid-19 pandemic. The mobile application shuffles Air Asia’s model as a flight and accommodation provider, to a broader platform of complimentary services. The app will offer users a variety of options, including digital payment services, delivery services, and an e-commerce platform. Air Asia Chief Executive and founder, Tony Fernandes, says the idea for the app was floated prior to the pandemic, but Covid-19 hastened its development.

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