THAI restructures and development after ICAO announcement

June 22TF-4THAI Airways announced it will sell 24 older planes by next year as part of its restructuring and return to profitability, as the Bangkok Airways CEO said he is mulling the purchase of new aircraft. Meanwhile, the government has replaced the head of the Department of Civil Aviation in order to speed up needed reforms to meet international safety standards.

THAI, the national carrier, has plans to dispose of 42 aircraft from 2015-16 as part of its business recovery and restructuring plans. It has sold 18 aircraft so far this year with a roughly even split between Boeing and Airbus models. To generate more sustainable revenue, the airline will focus on expanding its maintenance, overhauling and servicing work, and other services to more customers. Besides THAI’s fleet, the maintenance unit is now servicing THAI Smile and Nok Air.

Meanwhile, Transport Minister Prajin Juntong relieved Department of Civil Aviation (DCA) chief Somchai Phiphutthawat of his position just days before the International Civil Aviation Authority (ICAO) issued Thailand with a “red flag” because of ongoing concerns over aviation safety. The minister said he made the change so he could appoint a new chief who would be more suitable to implementing significant changes more quickly.

The move by the ICAO caused stocks in Thai airlines to fall, but is unlikely to have a major impact on the operations of the Kingdom’s airlines because Thai authorities have already been keeping aviation officials in other countries apprised of the steps they are taking to correct the problems. The ICAO did not cite any safety violations among Thai airlines, but pointed out problems with the DCA, which is the country’s aviation regulator.

The ICAO had issued a “yellow card” to Thailand three months ago, saying it had been advising successive Thai governments over many years of the need to make significant changes, but none had acted. It said the DCA is understaffed, its inspectors need more training and as the Department operates several provincial airports it position as their regulator is compromised.

DCA officials told local media that progress on the issues raised by the ICAO had been made, but more than 90 days are needed to tackle all the issues in a complete manner.

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