Thai Airways plans to return to US market after safety upgrade

BANGKOK • Thai Airways International plans to return to the United States market, after a United Nations safety upgrade of Thailand's aviation sector raised the odds of the Federal Aviation Administration (FAA) following suit.

The state-controlled carrier may add direct flights to America next year if the FAA promotes Thailand to its top safety category, said Mr Krittaphon Chantalitanon, vice-president of alliances and commercial strategy. He reaffirmed that the airline will add a maximum of 28 narrow-and wide-body aircraft to renew its fleet.

"Part of the strategic plan is to have the aircraft that would be able to fly non-stop from Thailand to the US efficiently," he said, adding that the firm is also paring costs to curb losses and achieve sustained profitability next year.

The UN's International Civil Aviation Organisation earlier this month scrapped a red flag that was imposed on Thailand in 2015 over safety concerns, after remedial steps by the Thai military government.

The red flag led to an FAA downgrade to Category 2, which prohibited Thai carriers from adding new services to the world's top aviation market by passengers.

Mr Krittaphon said he is optimistic the FAA will upgrade Thailand given the progress made by the country's carriers and civil aviation authority.

"We have been working very hard on cost restructuring," he also said in the interview last week. "We have to be leaner."

Mr Krittaphon added that eventual non-stop US flights may link Bangkok to California or New York.

Load factor, a measure of capacity utilisation, has exceeded 80 per cent in the past three months, he said, and services to Vienna will start next month, with the city becoming a strategic hub.

Thai Airways' stock has declined 25 per cent on a total return basis over the past 12 months, the worst performance among Asian airlines with a market value of at least US$1 billion (S$1.36 billion), according to data compiled by Bloomberg.

The firm posted losses in three of the past four years.

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A version of this article appeared in the print edition of The Straits Times on October 19, 2017, with the headline 'Thai Airways plans to return to US market after safety upgrade'. Print Edition | Subscribe