BANGKOK — Chansin Treenuchagron, Director and Executive of Thai Airways’ Rehabilitation Plan, marked his debut as an author with the book “Thai Airways: Soaring Through Turbulence,” which gained significant attention.
He shared details of this book at the 29th National Book Expo Thailand, which took place at the Queen Sirikit National Convention Center on October 12, 2024. This seminar was organized by Matichon Publishing and moderated by Sorakol Adulyanon, a well-known columnist of Prachachat Business, a media outlet of the Matichon Group.
The book offers insights into the airline’s survival strategies during one of the most challenging periods in its history, providing a blueprint for crisis management and recovery.
“After 38 years and having changed jobs 19 times, I was nearing the end of my role at PTT in early May 2020 when I received a call from Mr. Somkid Jatusripitak, then Deputy Prime Minister, and General Prayut Chan-o-cha, Prime Minister at the time, inviting me to lead Thai Airways at the height of its crisis,” Chansin shared about his journey to Thai Airways.
Thai Airways, the national carrier was struggling financially before the pandemic, having accumulated significant debts over the years. The pandemic, however, became the tipping point that forced the airline to either restructure or collapse entirely.
Chansin remarked on the pivotal moment when he decided to take on the monumental task of saving the national airline. “We needed to change our mindset about why we were on the verge of collapse,” Chansin explained. “Thai Airways has been in business for over 60 years, the same age as me. It’s a symbol of the country. If Thai Airways were to disappear, it would have serious consequences for the country.”
In a critical conversation with PM Prayut at that time, Chansin posed three key questions: “First, does Thai Airways still have a future?” The answer was yes. “Second, will there be layoffs?” The Prime Minister confirmed that job cuts were inevitable, but those affected would be fairly compensated.
“Lastly, does Thai Airways need to remain a state enterprise?” The response was no, it didn’t have to be. These answers convinced Chansin to take on the role and begin the challenging process of restructuring.
Upon stepping into his new position, Chansin found the airline in dire straits, describing it as a “sick patient on the verge of death.” Thai Airways was facing nearly 400 billion baht ($12 billion) in debt, had 13,000 creditors, and was operating with a 70-billion-baht ($2.1 billion) deficit.
“To put it simply, the company was bankrupt, burdened with massive debt, and had no funds to pay it off. Thai Airways had two options: declare bankruptcy and sell assets, or enter a rehabilitation plan.”
Thai Airways’ struggles were compounded by external crises over the years. He pointed out that, while the airline had accumulated losses, it only reported financial losses 12 times, mostly due to external shocks like the 1997 Asian financial crisis, the 9/11 attacks, the global financial crisis of 2008, and Thailand’s political instability after the 2011 floods. Missteps in aircraft and engine investments also contributed to the company’s long-term decline.
On May 27, 2020, Thai Airways officially filed for business rehabilitation, a move that sparked debate within Thai society. Some believed it would be better to let the airline go bankrupt.
However, Chansin strongly disagreed. “Thai Airways holds licenses to operate highly valuable routes across Europe and Asia, offering tremendous potential. But more importantly, Thai Airways is more than just an airline—it’s a national asset.”
THAI Soft Power
Chansin emphasized that Thai Airways is not just an airline, but a significant source of “soft power” for Thailand. He described the airline as a critical tool for the government, both in boosting the economy by attracting tourists and in ensuring national security. Over the years, Thai Airways has played a key role in evacuating Thai citizens from abroad during crises, showcasing its importance as a government asset in times of need.
“Thai Airways serves as a cultural ambassador, with our cabin crew representing ‘Thainess’ to the world,” he highlighted. He added that the airline not only promotes Thai hospitality but also introduces international passengers to Thai cuisine and products, contributing to the government’s broader soft power strategy.
However, the airline’s financial situation before the pandemic was already challenging, and COVID-19 exacerbated these difficulties. Before the pandemic, Thai Airways typically had a cash flow of 30-40 billion baht ($900-1,200 million), but by the time the company entered its business rehabilitation phase, that figure had plummeted to just 14 billion baht ($420 million).
Monthly revenues, which used to average around 15-18 billion baht ($450-540 million), fell drastically to just 300-600 million ($9-18 million), as the pandemic grounded flights. With operating expenses at 1.5 billion baht ($45 million) per month, drastic changes were necessary.
Chansin implemented several strategies to keep the airline afloat. One of his key moves was converting grounded passenger planes into cargo planes through negotiations with the International Civil Aviation Organization (ICAO). This shift, known as “Cargo in Cabin,” increased Thai Airways’ cargo revenue from 200-300 million baht ($6-9 million) to 3 billion baht ($90.5 million) per month.
In addition to boosting cargo operations, Chansin made the difficult decision to sell some of Thai Airways’ office buildings and aircraft to reduce expenses. He also introduced innovative ideas to generate revenue by bringing the airline’s in-flight services to the ground. This included selling airline meals to the public, and one of the most successful ventures was the creation of “Thai Airways Patonggo” (deep-fried dough sticks), which became viral.
These efforts, Chansin explained, were aimed at transforming Thai Airways into a leaner, more sustainable enterprise, while continuing to serve as an important cultural and economic asset for Thailand.
THAI Deep-fried Dough
In his book, Chansin reflects on the viral success of Thai Airways Patonggo (deep-fried dough sticks) as more than just a sales initiative—it became a symbol of resilience. “During a crisis, communication with the team is crucial,” Chansin emphasized.
Throughout nearly 30 live-streamed sessions, management maintained direct contact with employees, fostering a sense of unity. One of the key symbols of this cooperation was the sale of Patonggo, which became a viral sensation.
“We didn’t sell Patonggo to pay off debts,” Chansin explained. “Patonggo was a source of encouragement, a symbol of teamwork. It showed that Thai Airways’ staff were still here, committed to the company’s survival.”
The sight of Thai Airways flight attendants frying and selling Patonggo in the heart of the city resonated with many, bringing the airline closer to the Thai public—not just as passengers, but as part of the broader community. The Patonggo phenomenon was more than a business success; it was a morale boost.
“The fact that Patonggo was selling so well reflected that many Thais still love and feel connected to Thai Airways. It gave us the strength to keep fighting,” he said.
One of the guiding principles Chansin used to steer Thai Airways through its crisis was rooted in empathy: ‘They are people, we are people.’ This philosophy was put to the test when the company had to make difficult decisions about downsizing.
“This was the hardest decision I had to make,” Chansin admitted. Thai Airways reduced its workforce from 21,000 to 14,000 employees, offering severance packages that were legally compliant and fair.
“The hardest part was signing the papers,” Chansin recalled, “because I knew the impact it would have on the families of those who were leaving and the people who remained. The 7,000 employees who left are sacrifices, and their departure was necessary for the company’s survival.”
Through these challenging decisions and the symbolic success of Patonggo, Thai Airways fought to rebuild itself during one of its most difficult periods, demonstrating resilience and a renewed connection with the Thai people.
State-owned Status
Chansin also reflected on the limitations Thai Airways faced due to its status as a state enterprise, particularly in its inability to sell old planes. “The plane had been parked for 13 years and couldn’t be sold because it was part of a state enterprise,” he said, highlighting one of the key obstacles that hindered the airline’s business flexibility.
Before accepting his role as Thai Airways’ executive, he questioned the Prime Minister about this issue, acknowledging that the airline’s inability to quickly adapt to a rapidly changing competitive environment was partly due to its state-owned status.
Since then, he has made significant progress in reducing the airline’s burdens. “We’ve sold all of the old planes that were once a problem, including 10 B747-400s, 9 A340s, 6 A330s, B777-200s, and 6 A380s.” By selling these aircraft, the airline eliminated significant financial and operational strain.
One of the major reasons for moving Thai Airways away from state enterprise status was to attract shareholders with business expertise. Chansin noted that many creditors wanted the airline to operate as a private company to ensure it generated consistent revenue and could repay its debts.
The goal was to diversify its shareholder base, bringing in new expertise from the aviation industry. Thai Airways is currently preparing to sell shares through a Private Placement, seeking investors with aviation experience to help steer the company into the future.
Although Thai Airways has entered the final phase of its rehabilitation plan, Chansin acknowledged that external factors could still pose challenges.
“We’ve passed the lowest point, but there are risks we cannot control, such as international political factors, domestic politics, and oil prices,” he said.
As part of its recovery strategy, Thai Airways plans to set up a new board of directors to manage the organization and aims to return to the Stock Exchange of Thailand by early 2025.
The company has committed to paying off its debts within eight years, and while it will no longer operate as a state enterprise, it will continue to serve as the national airline, offering improved service for both Thai and international passengers.
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