PM blasts Thai for inefficient management
Aug 27, 2001, 6:22 am
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PM blasts Thai for inefficient management
BC-AIRLINES-THAILAND-THAI (UPDATE 2)
UPDATE 2-Thai Air share falls after PM criticism
(Updates throughout)
By Kettiya Jittapong
BANGKOK, Aug 27 (Reuters) - Shares in Thai Airways International Plc fell on Monday after Thai Prime Minister Thaksin Shinawatra criticised the carrier's management for inefficiency.
Thaksin told reporters conflicts between members of the management team at Thai Air had caused inefficiency and the
national carrier needed urgent reform.
"Today, Thai Air has a very weak management which has been caused by many internal rifts, hurting its efficiency," Thaksin said before flying to China for an official visit.
On Monday, Thai Airways shares closed down 0.50 baht, or 1.69 percent at 29.50 baht, close to their all-time low of 26
baht. The overall Thai stock market index meanwhile gained 1.93 percent.
Thai Air has underperformed both the Thai stock market and the local transport stock sub-index by 24 percent and 12
percent, respectively, this year.
Analysts said investors used Thaksin's comments as an excuse to take profit after Friday's gain of over six percent.
"Thai Airways shares rose sharply last Friday. Normally only a few investors trade the stock. Thaksin comments are a
good reason for them to take profit," said Padermpob Songkroh, senior analyst at Jardine Fleming Thanakom Securities.
DISPUTE
Thaksin's comments came after a dispute between the airline's pilots and a labour union over the weekend when
pilots refused to fly with union members on a Singapore-bound flight.
The union and Thai Airways pilots have been in conflict after pilots' request for a pay rise was opposed by the union,
which argued the salary increase was inappropriate at a time when the company was cutting costs.
The pilots finally agreed to take off after three hours of negotiations.
Somchainuek Engtrakul, permanent secretary for finance, told reporters the conflict would have no impact on the
airline's plan to sell shares to the public, expected in November.
"We will not delay," Somchainuek said.
The airline has said it plans to offer 300 million new and 100 million existing common shares to the public, which will cut government stake in the airline to 70 percent from 93 percent.
More than 10 percent could be offered to a foreign strategic partner.
Thai Airways President Bhisit Kuslasayanon said the pilots' action had affected customer confidence in the carrier. He dismissed suggestions that he should resign over the incident.
The airline is seeking a new candidate to replace Bhisit after his retirement, due in September 2002.
Reut06:29 08-27-01
UPDATE 2-Thai Air share falls after PM criticism
(Updates throughout)
By Kettiya Jittapong
BANGKOK, Aug 27 (Reuters) - Shares in Thai Airways International Plc fell on Monday after Thai Prime Minister Thaksin Shinawatra criticised the carrier's management for inefficiency.
Thaksin told reporters conflicts between members of the management team at Thai Air had caused inefficiency and the
national carrier needed urgent reform.
"Today, Thai Air has a very weak management which has been caused by many internal rifts, hurting its efficiency," Thaksin said before flying to China for an official visit.
On Monday, Thai Airways shares closed down 0.50 baht, or 1.69 percent at 29.50 baht, close to their all-time low of 26
baht. The overall Thai stock market index meanwhile gained 1.93 percent.
Thai Air has underperformed both the Thai stock market and the local transport stock sub-index by 24 percent and 12
percent, respectively, this year.
Analysts said investors used Thaksin's comments as an excuse to take profit after Friday's gain of over six percent.
"Thai Airways shares rose sharply last Friday. Normally only a few investors trade the stock. Thaksin comments are a
good reason for them to take profit," said Padermpob Songkroh, senior analyst at Jardine Fleming Thanakom Securities.
DISPUTE
Thaksin's comments came after a dispute between the airline's pilots and a labour union over the weekend when
pilots refused to fly with union members on a Singapore-bound flight.
The union and Thai Airways pilots have been in conflict after pilots' request for a pay rise was opposed by the union,
which argued the salary increase was inappropriate at a time when the company was cutting costs.
The pilots finally agreed to take off after three hours of negotiations.
Somchainuek Engtrakul, permanent secretary for finance, told reporters the conflict would have no impact on the
airline's plan to sell shares to the public, expected in November.
"We will not delay," Somchainuek said.
The airline has said it plans to offer 300 million new and 100 million existing common shares to the public, which will cut government stake in the airline to 70 percent from 93 percent.
More than 10 percent could be offered to a foreign strategic partner.
Thai Airways President Bhisit Kuslasayanon said the pilots' action had affected customer confidence in the carrier. He dismissed suggestions that he should resign over the incident.
The airline is seeking a new candidate to replace Bhisit after his retirement, due in September 2002.
Reut06:29 08-27-01
Aug 30, 2001, 1:17 am
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The saga of THAI, pilots vs their union, power struggles, and the like seem to be escalating. It was all the big talk here at breakfast this morning. A few links from The Nation:
AIRLINE CONFLICT: THAI row in holding pattern and Two govt camps vie for THAI. Perhaps a more cheerful opinion piece might be THAI TALK: Forget the pilots, THAI is flying rudderless, or even FACE OFF: The Airways Dispute -- The TG 401 pilots' action is a disgrace.
AIRLINE CONFLICT: THAI row in holding pattern and Two govt camps vie for THAI. Perhaps a more cheerful opinion piece might be THAI TALK: Forget the pilots, THAI is flying rudderless, or even FACE OFF: The Airways Dispute -- The TG 401 pilots' action is a disgrace.
Aug 30, 2001, 11:43 pm
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Unfortunately, The Nation does not keep their links active for more than one day. Today's story (THAI set for a major shake-up), which I will cut and paste below, discusses Thaksin's intervention in the pilot's dispute, and plans to bring in management outsiders. Sad to say, but I have never personally witnesssed such an amateurish operation as the one going on here in BKK at present. Six months ago, I was hoping for better, but what we have is nothing more than common third-world politics at its best (or worst).
Today's story follows...
THAI set for a major shake-up
Published on Aug 31, 2001
The management of beleaguered Thai Airways International will be soon be overwhelmed by scores of outside experts dispatched by the prime minister to reorganise the company in the wake of a bruising dispute between pilots and union leaders.
Prime Minister Thaksin Shinawatra yesterday said there would be no immediate change in the upper echelon of management at THAI, nor would the minister in charge of the national carrier be ousted in the wake of last Saturday’s dispute.
The incident, which delayed a THAI plane for more than four hours on the tarmac at Don Muang International Airport, quickly escalated into a dogfight between two powerful groups in the Thai Rak Thai Party.
Deputy Transport Minister Pracha Maleenont, who oversees THAI, yesterday defended himself in Parliament by claiming the dispute had been merely been the result of “miscommunication” between pilots and union leaders.
The THAI flight, bound for Singapore, was delayed when two pilots refused to take off because one of the union leaders who had challenged their push for a pay rise was on board.
Union officials rejected the pilots’ request for a pay rise and accused the pilots of being “inefficient”. THAI president Bhisit Kuslasayanon yesterday led representatives from the labour union and the pilots to separate meetings with Thaksin at Government House.
After the two meetings, Thaksin said the dispute had been an “accident” and that the misunderstanding between the two sides had been sorted out.
“We’ll start anew,” he said.
“Fundamentally, THAI’s problems are the consequence of inadequate organisational development, as well as a lack of strong leadership. “We’ll have to properly analyse the structural and other problems,” he said.
“We will design a new organisation and management system that emphasises merit and transparency, so that THAI can compete with other airlines effectively,” said the premier.
“We will not be concerned with personalities just yet. Once the new structure and system are in place, we will put the right people in the right place,” he said.
Thaksin intends to personally oversee THAI’s restructure. He is to assemble a 100strong contingent for the task – before the airline goes ahead with a new public offering of 23 per cent of its shares later this year.
Thaksin said he intended ensuring that the incumbent president exercises his leadership to increase the airline’s competitiveness in a fiercely competitive industry.
All of THAI’s work processes are to be reviewed by the 100strong taskforce, the exact makeup of which has not yet been decided.
Analysts say THAI is currently less competitive than other regional carriers, such as Singapore Airlines and Cathay Pacific.
They estimate THAI’s stock market capitalisation is between five and 10 times less than that of its regional competitors and that its assetutilisation ratio, product quality, service and value to shareholders are also well behind the pack.
The lack of change at the top in THAI yesterday could be explained by Thaksin finding himself caught between two powerful Thai Rak Thai factions that are currently at loggerheads.
There were persistent rumours leading up to yesterday’s meeting that president Bhisit and chairman ChaiAnan Samudvanija would be sacked.
But one camp in the PM’s party is led by key Thai Rak Thai financial contributor Pracha, who currently oversees THAI operations. Pracha has been consistently pushing for Bhisit’s ouster and quite possibly a new chairman at the helm.
But chairman ChaiAnan is backed by another powerful faction of Thai Rak Thai, of which Finance Minister Somkid Jatusripitak is a member.
Somkid has thus far refused to yield to Pracha and has fought back by appointing Thanong Bidaya, one of the PM’s close aides, as a vice chairman and head of the airline’s longterm planning committee.
It is a deft bid to pare back Pracha’s powers.
The Nation
Today's story follows...
THAI set for a major shake-up
Published on Aug 31, 2001
The management of beleaguered Thai Airways International will be soon be overwhelmed by scores of outside experts dispatched by the prime minister to reorganise the company in the wake of a bruising dispute between pilots and union leaders.
Prime Minister Thaksin Shinawatra yesterday said there would be no immediate change in the upper echelon of management at THAI, nor would the minister in charge of the national carrier be ousted in the wake of last Saturday’s dispute.
The incident, which delayed a THAI plane for more than four hours on the tarmac at Don Muang International Airport, quickly escalated into a dogfight between two powerful groups in the Thai Rak Thai Party.
Deputy Transport Minister Pracha Maleenont, who oversees THAI, yesterday defended himself in Parliament by claiming the dispute had been merely been the result of “miscommunication” between pilots and union leaders.
The THAI flight, bound for Singapore, was delayed when two pilots refused to take off because one of the union leaders who had challenged their push for a pay rise was on board.
Union officials rejected the pilots’ request for a pay rise and accused the pilots of being “inefficient”. THAI president Bhisit Kuslasayanon yesterday led representatives from the labour union and the pilots to separate meetings with Thaksin at Government House.
After the two meetings, Thaksin said the dispute had been an “accident” and that the misunderstanding between the two sides had been sorted out.
“We’ll start anew,” he said.
“Fundamentally, THAI’s problems are the consequence of inadequate organisational development, as well as a lack of strong leadership. “We’ll have to properly analyse the structural and other problems,” he said.
“We will design a new organisation and management system that emphasises merit and transparency, so that THAI can compete with other airlines effectively,” said the premier.
“We will not be concerned with personalities just yet. Once the new structure and system are in place, we will put the right people in the right place,” he said.
Thaksin intends to personally oversee THAI’s restructure. He is to assemble a 100strong contingent for the task – before the airline goes ahead with a new public offering of 23 per cent of its shares later this year.
Thaksin said he intended ensuring that the incumbent president exercises his leadership to increase the airline’s competitiveness in a fiercely competitive industry.
All of THAI’s work processes are to be reviewed by the 100strong taskforce, the exact makeup of which has not yet been decided.
Analysts say THAI is currently less competitive than other regional carriers, such as Singapore Airlines and Cathay Pacific.
They estimate THAI’s stock market capitalisation is between five and 10 times less than that of its regional competitors and that its assetutilisation ratio, product quality, service and value to shareholders are also well behind the pack.
The lack of change at the top in THAI yesterday could be explained by Thaksin finding himself caught between two powerful Thai Rak Thai factions that are currently at loggerheads.
There were persistent rumours leading up to yesterday’s meeting that president Bhisit and chairman ChaiAnan Samudvanija would be sacked.
But one camp in the PM’s party is led by key Thai Rak Thai financial contributor Pracha, who currently oversees THAI operations. Pracha has been consistently pushing for Bhisit’s ouster and quite possibly a new chairman at the helm.
But chairman ChaiAnan is backed by another powerful faction of Thai Rak Thai, of which Finance Minister Somkid Jatusripitak is a member.
Somkid has thus far refused to yield to Pracha and has fought back by appointing Thanong Bidaya, one of the PM’s close aides, as a vice chairman and head of the airline’s longterm planning committee.
It is a deft bid to pare back Pracha’s powers.
The Nation