Thai Airways Files For Bankruptcy Protection
Following the news and updates around the COVID-19 pandemic, many airlines were forced to suspend or reduce their daily operations. We have the latest information from airlines and hotels all around the world. Unfortunately, many airlines are struggling to stay afloat during the pandemic. Virgin Australia was the first large airline to fall under the pressure of the COVID-19 pandemic. We also saw airlines like South African Airlines, SAS, British Airways, and many more being forced to fire a big number of employees due to lack in demand. The world's second-oldest airline, Avianca was forced to file for bankruptcy protection, and now another huge airline is making the same move. Thai Airways filed for bankruptcy protection this week before a court in Bangkok.
Thai Airways Files For Bankruptcy ProtectionThai Airways applied for bankruptcy protection on Tuesday, May 26, before a court in Bangkok. The Central Bankruptcy court announced the day after that the court had accepted a petition by Thai Airways to file for bankruptcy. Additionally, a stay was put in place against all actions by creditors against the airline. The Central Bankruptcy court scheduled the first hearing for the carrier for August 17, 2020. Thai Airways appointed five people, including one its former president Piyasvasti Amranand, to the rehabilitation committee. From the official press release:
Although THAI's reform plan will be implemented and exercised through the business reorganization chapter under the bankruptcy law, THAI will not be dissolved or go into liquidation or to be declared bankrupt. On the contrary, the business reorganization chapter will enable THAI to reach its reform plan's objectives even more effectively step by step as required by the law which provides equitable protection to all relevant stakeholders while THAI will be able to conduct its normal business operations including passenger and cargo transportation. The business will be conducted in parallel with the reform plan to increase operational efficiency and improve product and service quality.Thai Airways was already in some financial troubles and the COVID-19 pandemic only deepened the problem. The carrier had reported a loss of $374 million in 2019, similarly to its 2018 numbers. The government of Thailand imposed strict restrictions to try and minimize the spread of the virus in late March. Because of these restrictions, the carrier grounded its entire fleet and stopped all operations. More than half of the debt of the airline is held abroad and they will probably file for Chapter 11 Bankruptcy Protection in the US in the coming weeks.