THAI Announces Operational Strategy

Thai Airways International Public Company Limited held a press conference to announce the airline's future plans and operational strategy. The conference was chaired by Mr. Pracha Maleenont, Transport and Communications Deputy Minister, Mr. Chai-anan Samudavanija, THAI's Chairman, Mr. Soonthorn Pokachaipipat, Chairman of THAI's Executive Committee and Mr. Bhisit Kuslasayanon, THAI's President.

Deputy Minister Pracha said he was aware of the dedicated efforts made by all functions within THAI, as well as the Board of Directors and the Management. They have tried their best to fulfil their responsibilities for the best interests of THAI.

It is now a matter of urgency that THAI must speed up the development of the airline's State Enterprise plan in compliance with the policy and guidelines established by the Ministry of Transport and Communications.

Deputy Minister Pracha categorized the problems for THAI's Management to take action as follows:

1. Financial - To increase Market capital as currently, THAI's market capital was reduced to USD 970 million from USD 1,200 million in 1998

2. Marketing - THAI should focus on passenger target groups in accordance with the changing consumer trend and Star Alliance member airlines. THAI should also strive to generate greater revenue by cooperating closely with the Tourism Authority of Thailand to offer innovative tourism products.

3. Management - THAI should look for ways in which the airline may utilize aircraft more efficiently, gain more benefits from being a member of the Star Alliance, and lessen government regulations in order to sharpen THAI's competitive edge.

4. To establish guidelines and plans for investment at Suwannabhumi Airport

5. Privatization guidelines Deputy Minister Pracha also said that, "Thai Airways International today should move away from the old ways of thinking as THAI is facing a weakening financial situation when compared to other airlines in this region. The market capital has decreased, the debt to equity ratio has increased while the country's economic situation remains low."

As for THAI's strategic plans, Mr. Chai-anan Samudavanija, THAI's Chairman said that committees have been set up to help increase shareholder value and competitiveness. These committees are:

1. Strategic Steering Committee

2. Project Management Committee

3. Task Force Committee

The area of responsibilities of the Task Force Committee may be divided as follows:

3.1 Service and Product Quality - to increase the quality of THAI's products and services in order to attract more passengers

3.2 Operational efficiency - to increase operational efficiency in areas of finance, revenue, alliances, operations at Bangkok International Airport and especially domestic cargo operations

3.3 Management - which involves management of areas including financial, human resources, business units, communications, investors, employees and e-business.

These strategic plans will help ensure that THAI can effectively compete with other airlines and accommodate the growing needs of passengers in accordance with THAI's State Enterprise plan.