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Thai Airways May Lease New Planes and Contract Cabin Crew in Effort to Reduce Costs and Mounting Losses

Thai Airways May Lease New Planes and Contract Cabin Crew in Effort to Reduce Costs and Mounting Losses

Thailand’s Transport Minister Saksayam Chidchob has said Thai Airways may lease new planes and contract cabin crew as part of the debt-laden airline’s fleet renewal plans.  Any plan to “wet lease” cabin crew who are not directly employed by the airline would require a change in the law, although Saksayam noted that regulations could be amended in order to pave the way for cheaper outsourced crew to operate flights.

Thai Airways plans to procure 38 new aircraft but a final decision on whether to buy or lease the planes has not yet been made.  If Thai Airways were to lease the aircraft, the airline could potentially arrange for them to delivered with or without operating crew.

The cost-benefit of so-called “wet leasing” an aircraft with outsourced crew comes down to being able to lease the aircraft on a short term contract with all training and development of the crew being handled by the contract provider.  Wet leased crew would not enjoy the usual pay and benefits afforded to directly employed staff.

According to the Bangkok Post, the airline’s president Sumeth Damrongchaitham confirmed an aircraft renewal proposal had already been drawn up that it would now be updated to include the Transport Minister’s suggestion of leasing planes with cabin crew.

Thai reported a loss of USD 365 million in 2018 but efforts to turn around the airline’s fortunes have been hampered by an ageing aircraft fleet which is fuel in-efficient and in need of expensive maintenance.  Late last year, Sumeth rowed back on comments he made at a management meeting in which he suggested the carrier was at “crisis point” and at risk of shuttering if it didn’t start making more money.

In October, Thai Airways changed its cabin crew contracts for new hires in an attempt to reduce ongoing costs.  Recently recruited crew will initially be hired on a three-year contract which may be extended for just one more period of three years dependent on personal performance and company performance.

Two hundred new cabin crew have been hired with the new contract – applicants could not be aged over 24 years old, had to be single, never married and without children to be considered for the role.

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