THAI to lay off 400 staff after loss

This is the third early-retirement programme by the company in five years.

President Apinan Sumanaseni said the programme would cost about Bt700 million. The expense, in addition to other costs, would require THAI to cut its investment budget for the second half by Bt3 billion, he said.

"At the meeting yesterday, the board also approved plans to reduce direct flights to Los Angeles and other routes to cut losses," he said.

THAI attributed the losses to the higher price of jet fuel and the baht's appreciation against the US dollar. The airline's revenue is mainly denominated in foreign currencies.

THAI posted net profits of Bt2.2 billion in the first quarter while its 2007 profit of Bt1.8 billion was 795 per cent down from the 2006 figure of Bt8.99 billion.

Meanwhile, THAI shareholders have filed a lawsuit in the Criminal Court against the company's chairman and president, accusing them of actions that resulted in damages and losses to the airline and shareholders.

Two shareholders - Visut Sahachatmanop and Jindasri Sudsawas - delivered the suit document to other shareholders yesterday.

The Criminal Court had accepted the lawsuit on Monday.

The shareholders said THAI chairman Chaisawasd Kittipornpaiboon, along with president Apinan, had violated their powers by allegedly making profits from the company's aircraft procurement.

The shareholders made five allegations against the chairman and president, including presenting false facts to the board of directors to approve pre-delivery payment to Airbus.

They alleged that the payment, amounting to Bt4 billion, was made despite knowing the Cabinet had resolved that THAI not purchase the A330-300s but instead lease them.

THAI should have notified Airbus and discussed with them to find solutions to comply with the Cabinet's resolution, instead of deliberately making payment, they alleged.

The two have also been accused of allegedly misleading the board of directors to select Rolls-Royce engines for A330-300 aircraft by presenting false facts.

The result was that THAI had to pay an extra Bt200 million more than the normal price, the shareholders said. The cost of all engines totalled Bt20 billion.

The shareholders also make other claims about poor financial decisions.