Thai Airways Could Cancel Airbus A380 Jet Order

BANGKOK (AP) -- Thai Airways International Ltd. is reviewing its order for six Airbus A380s as the slump in global travel undermines the profitability of flying the superjumbo.

The airline, which lost 21.4 billion baht ($625 million) in 2008, has the aircraft slated for delivery in 2010 and the following year. It would use them for direct flights from Bangkok to London, Sydney and Tokyo, and possibly Frankfurt and Paris.

"We are taking a hard look at our options -- whether we want to have the A380s, whether they are affordable in the current economic downturn," head of investor relations Raj Tanta-Nanta said Tuesday.

Thai Airways has also been hit by a slump in Thai tourism following anti-government riots in Bangkok in April and other protesters shutting the capital's two airports for a week late last year.

The review of the airline's fleet plan should be completed by the end of this month but any board decision to cancel the order would need approval from the Ministry of Finance, which owns 51 percent of Thai Airways.

Raj said canceling the order -- which at sticker prices is worth nearly $2 billion -- would relieve financial pressure on the airline but could hurt its competitiveness in the longer-term.

He said the plane would need to have 80 percent of seats filled to be profitable, which is difficult while the world economy is in a slump.

Thai Airways Chairman Wallop Bhukkanasut in a Bangkok Post report Tuesday said it "does not make economic sense" for the A380 to be part of the carrier's fleet.

"My immediate preoccupation is to enable Thai to survive the current storm and later to sustain the airline," he said.

The world's airlines will collectively lose $9 billion this year -- nearly double the previous projections -- and face a slow recovery as the economic crisis saps air travel and cargo demand, according to the International Air Transport Association.

The superjumbo has been in service since Singapore Airlines took delivery of the first of the double-decker A380 planes in late 2007.

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