InfoQuest (March 30, 2020) -- Mr. Santisuk Klongchaiya, CEO of Thai AirAsia (AAV), announced a management plan to reduce impacts of Covid-19, and travel limitation measures to respond to the state's emergency order against the epidemic.
AAV announced to suspend all the following flights:
From March 22 to April 25, all international fights are grounded temporarily. In 2019, the passenger traffic of international flights accounted for 41 percent of total.
On April 1-30, all domestic flights are grounded. In 2019, the passenger traffic of domestic flights accounted for 59 percent of total.
Meanwhile, measures will be taken to reduce cost and expenditures. In terms of cost control, AAV's top executives and senior employees will see they salary cut by 10-75 percent, on a voluntary basis, aiming to help the company tide over the period of declining travel demand and alleviate the impacts on overall staff.
Variable expense accounts for 70 percent of total expenditures, and temporary grounding will help cut flight-hour charge, fuel costs, variable maintenance costs, airport service charges, utilities, and general management costs of WFH policy.
Besides, AAV has limitations on unnecessary travel on the part of employees, and has suspended recruitment. The company is seeking for other ways of cutting costs.
In terms of liquidity and financial situation, the company values the liquidity of funds to ensure normal operation in severe circumstances. In the end of 2019, the company's cash and short-term investment funds totaled 3.982 billion baht.
AVV has announced that it has sold and leased back 9 airplanes and sold one on March 12, 2020. After repaying loans and paying other fees, it received about 3.6 billion baht of net cash. The company also has additional available liquidity credit lines and has the ability to sell aircraft without legal contract, or supplements liquidity through other means.
AVV is reviewing investment plan and may suspend or delay investment in high-value assets. The company is considering adjusting the number of fleet to meet the demand in the current situations. It may suspend purchasing new planes this year.
Source: InfoQuest, by Saowalak Ouypron / Sasithorn, translated by Xinhua Silk Road.
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