Thai Airways International (THAI) has admitted it is struggling to sell its decommissioned Airbus A340 aircraft as they are unpopular in the used plane market, the national flag carrier's public relation unit says.

The airline's statement came after a group of about 100 THAI staff on Sunday called for Prime Minister Prayut Chan-o-cha to invoke Section 44 of the interim constitution to probe the procurement of 10 Airbus A340 planes bought by the national flag carrier, which have been grounded and "left to rot".

The aircraft acquisition process took place between 2002 and 2003.

The group said the use of the aircraft had caused annual losses of 3-5 billion baht for THAI which is why they had to be grounded. They are parked at Don Mueang and U-Tapao airports.

According to THAI's statement, the Airbus A340s were purchased when the cost of jet fuel was low and were used to compete on intercontinental routes.

"When the cost of jet fuel became expensive, other carriers with the same aircraft type in their fleet also experienced the same problem as THAI of incurring losses and decommissioned this type," the statement says.

The national carrier said the company on several occasions attempted to operate this aircraft type on various routes but was unable to turn a profit and planned to decommission them from the fleet.

"An announcement was made of their sale but as there was little demand in the second-hand aircraft market for this type, the aircraft price was lower than the value that the company should have got," it said.

"Therefore, the plan for sale was revised and a buyer was sought that would benefit from it, for example the Royal Thai Air Force.

"THAI is a state enterprise with strict adherence to regulations on the sale of assets that at times can prove to be an obstacle to selling aircraft quickly."

The company also insisted it placed an emphasis on the improvement of procurement regulations and inspections on corruption after the bribery scandal involving British engineering giant Rolls-Royce. The case was revealed by the UK's Serious Fraud Office.

According to the statement of facts prepared in a British court, the period of the scandal dates from 1991 to 2005 and involves payments totalling about US$36.38 million (1.28 billion baht) to "regional intermediaries".

Some of the money was for individuals who were "agents of the state of Thailand and employees of THAI Airways".

The scandal involved the purchase by THAI of Rolls-Royce T800 engines, according to the document.

"The company has continually placed high importance on transparency regarding procurements, evident through revisions to the procurement regulation. The company will not make procurements through a middleman; a procurement committee must be established with committee members from various departments for a balance of power," the statement said.

Source:
courtesy of BANGKOK POST

by Bangkok Post

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