Despite the reopening of Thailand on Noveber 1, Thai AirAsia announced mass layoffs and extended furloughs after struggling with the impact of the pandemic on the airline.

According to a report from The Bangkok Post, Tassapon Bijleveld, executive chairman of Asia Aviation (AAV) – Thai AirAsia's largest shareholder – made the announcement on Wednesday (November 17) to the airline's employees. Bijleveld cited the unstable outlook of the aviation industry which has prompted the company to reduce its fleet next year and use layoffs and extended furloughs.

"Even though we've negotiated with suppliers and banks to help offload aircraft leasing costs, and we may get additional liquidity after restructuring this month, our balance sheet cannot be strong enough if those expenses still run. We have to permanently cut the fleet for at least two years or until international and domestic flights fully recover," Tassapon was quoted saying during an internal meeting.

The Thailand-based subsidiary of the AirAsia Group is deciding on the number of layoffs this week. It will then announce the list of employees to be laid off by next week. The airline will also launch an early retirement program for those interested to leave the company.

In addition to the planned layoffs, Thai AirAsia previously announced it would remove six (6) aircraft from its fleet of 60 aircraft to 54 as entry restrictions for international travel still vary from country to country.

Tassapon also added that with the airline bottoming out during the third quarter, international flights might gradually return to 20-30% of pre-pandemic levels. While the carrier forecasts a full recovery in the domestic market by mid-2022, Tassapon also added that the best case scenario for international route resumptions would be 50% of pre-pandemic levels by the end of 2022.

"It's hurtful to take such a decision, but it's based on reality which we cannot answer as to when the situation will improve. We have to wait until revenue from international routes comes back and that will depend on the entry regulations of Thailand and overseas destinations," Tassapon said.

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