Published on : Tuesday, May 19, 2020
Thai Airways had previously asked for a government bail-out via a 58.1bn baht ($1.81bn, £1.48bn) loan and has now been allowed to restructure its debts to keep the planes plying.
Thai officials told the airline to come up with a restructuring plan to avoid going bankrupt as the global airline industry is facing a severe financial crisis due to coronavirus travel restrictions with a growing list of casualties.
Even before the coronavirus outbreak Thai Airways was under financial pressure and in 2019, it reported losses of 12bn baht.
The airlines strongly denies rumours that it was looking to file for bankruptcy and on the website in a statement it mentioned that “it has no intention to file for bankruptcy, responding to rumours appeared in the news and online”.
Thai government owns 51% of the airline and is overseen by its State Enterprise Policy Committee (SEPC).
Thailand’s Prime Minister, Prayuth Chan-ocha, said that the government has reviewed all dimensions and have decided to petition for restructuring and not let Thai Airways go bankrupt. The airline will continue to operate.
The previous rescue package put forward by the airline involved a government guaranteed loan backed by the finance ministry.
There are around 80 planes of Thai Airways and employs 22,000 people. It said this week it would not resume international flights until at least 30 June.
According to the International Air Transport Association air travel is not expected to return to normal until 2023, putting further pressure on airlines globally.