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Streamlining Strategies: Thai Smile and THAI Announce Merger to Cut Losses

In a strategic move to minimize losses, Thai Airways International (THAI) Public Company Limited disclosed its plans on Friday to merge Thai Smile Airways with THAI. The airline envisions the approval of this merger by the end of the year.

In a strategic move to minimize losses, Thai Airways International (THAI) Public Company Limited disclosed its plans on Friday to merge Thai Smile Airways with THAI. The airline envisions the approval of this merger by the end of the year.

Piyasvasti Amranand, Chairman of THAI’s rehabilitation committee, revealed that the restructuring had long been in consideration as part of their overall plan. He explained, “A study on the merger plan is currently underway to refine the business strategy under a unified management team. We anticipate its completion by May.”

Speaking at a press conference, Mr. Piyasvasti elaborated on the subsequent steps, stating, “Following this, the plan will be presented to a creditors’ committee before being submitted to Transport Minister Saksayam Chidchob, the acting chairman of the civil aviation committee, for approval by the end of the year.”

CEO Chai Eamsiri emphasized that the merger aims to simplify the organization’s management and flight schedule, ensuring seamless operations for all flights. He reassured that the merger would not impact THAI’s rehabilitation plan or the services provided, including those for the 800-plus employees of Thai Smile.

If successful, the merger is expected to boost THAI’s capacity, extending Thai Smile’s flight operation hours from nine to approximately 12-13 per day. This strategic move could potentially reduce the budget by 30% and contribute to increased profits this year, according to Mr. Chai.

Highlighting the financial backdrop, it was noted that Thai Smile incurred losses of 4.24 billion baht last year, with a cumulative loss exceeding 20 billion baht. Looking ahead, Mr. Chai expressed optimism, projecting that THAI and its subsidiary would generate approximately 140 billion baht in revenue this year, a 30% increase from 2022. Flight occupancy is also anticipated to climb to 80% as tourism stages a recovery.

Additionally, THAI has resumed more international flights to various destinations, including Europe, Australia, China, and Japan. Currently operating a total fleet of 64 aircraft, of which 44 belong to THAI, the airline plans to enhance its capabilities by renting six Airbus A350s this year. Moreover, a Boeing 777-200ER is set to be received and repaired, pushing the total fleet count to 71.

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