Thai Airways International PCL (THAI) revealed on Wednesday that it is preparing to terminate its low-cost carrier Thai Smile after continuous losses of 10 billion since 2013.
As part of the troubled airline’s rehabilitation process, Thai Smile Airways will be merged with Thai Airways.
Piraphan Salirathavibhaga, a TG director, said that Thai Airways holds all of Thai Smile’s shares, and with losses of 10,305 million baht in the first half of 2020 due to the coronavirus impact, the low-cost airline cannot continue to operate.
“The rehabilitation of Thai Airways is not difficult,” said Piraphan. “There are problems that continue to the present, one of those is the continuous loss of Thai Smile.”
During a rehabilitation hearing at the Bankruptcy Court on Monday, creditors said that they doubted the experience of EY Corporate Advisory Services Co., Ltd. to manage the rehabilitation process.
The Central Bankruptcy Court scheduled a second hearing for the rehabilitation petition of Thai Airways on August 20, 2020.
Two witnesses include Chai Iamsiri, the acting deputy chief executive of Finance and Accounting, and Deloitte Touche Tohmatsu Jaiyos Audit Co., Ltd. as auditors of Thai Airways. Along with an examination of one creditor who opposes the rehabilitation plan, this has raised doubts.
Piraphan said the hearing on August 20 will focus on clarification on the financial situation and any financial need for the rehabilitation.
The financial department of Thai Airways has prepared the information and they believe that the plan will succeed.
If the Central Bankruptcy Court approves the rehabilitation plan, Thai Airways would take three months to create changes in its services and with restructuring the company.