THAI struggling with huge debt, executives asked to take voluntarily pay cut
Thai Airways International, the national flag carrier, appears to be in a deep financial crisis and may have to delay debt repayments or seek new loans.
THAI president Sumet Damrongchaitham said this morning (Monday) that he has asked the company’s executives, himself included, to cut their meeting allowances and remuneration voluntarily to show spirit in helping the organization get through this crisis.
“This is just one of the measures to cut costs so that THAI will be able to compete in the aviation industry. The spirit of the board and executives will inspire others in our organization to realize that it is high time that we join forces in all ways to survive this crisis. Whatever can be sacrificed must be sacrificed,” said Mr. Sumet.
He assured the company’s staff that they should not be worried about the remuneration cuts, saying that it will be confined only to the management, and that the voluntary measure will not affect the quality of the company’s services.
Meanwhile, an informed source in the Transport Ministry said that THAI’s debt crisis was very serious and puts the carrier at risk of bankruptcy, with its combined total debt amounting to about 245 billion baht, a debt to equity ratio of 14.55 and debt service coverage ratio reducing to 0.62.
The source said, if THAI is allowed to buy a new fleet of planes, worth an estimated 156 billion baht, it would become the world’s most indebted airline.