Thai Airways will move ahead on MRO project after Airbus pulls out and warns of tough times ahead

Airbus has asked not to participate in the investment, citing the impact of the COVID-19 situation on air travel, Deputy Secretary-General for Infrastructure in the Eastern Economic Corridor (EEC) Chokchai Panyayong told reporters in Thailand.

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Former Airbus commercial plane chief Fabrice Brégier and Thai officials at the original deal signing. (PHOTO: Airbus)

European plane maker Airbus, which is facing dire times like most of the rest of the aviation industry, is said to have pulled out of a planned joint venture with state-owned Thai Airways International that would have seen the two companies build a US$339 million maintenance facility east of Bangkok, according to a news briefing by government officials. Airbus has asked not to participate in the investment, citing the impact of the COVID-19 global pandemic situation on air travel, Deputy Secretary-General for Infrastructure in the Eastern Economic Corridor (EEC) Chokchai Panyayong told reporters in Thailand.

The maintenance hub is part of the government’s project around the joint civil-military U-Tapao Airport, 150 kilometres east of Bangkok. (PHOTO: Shutterstock)

The project to build the maintenance, repair and overhaul (MRO) facility will continue, Chokchai said, adding that Airbus would still cooperate on technology. Rumours had been circulating for weeks that the deal was on the rocks and an Airbus spokesperson had earlier told Asian Aviation that it was “in continuing discussions” about the best way forward. But as the COVID-19 pandemic has swept the globe, killing more than 200,000 as of late April, commercial aviation has ground to a virtual halt and the entire industry – from plane makers to airports to MRO shops – are in survival mode and most expansion plans have been put on hold.

A screenshot of the virus tracking site at Johns Hopkins University taken on 28 April showing more than 200,000 deaths worldwide due to the COVID-19 pandemic. To access the live site click on the image. (PHOTO: Matt Driskill)

Airbus officials were said to have warned employees that deep job cuts could be in store for them as the aviation world reorients itself to a much reduced industry as long as countries maintain travel restrictions.

There is still time for Thai Airways to find a new partner as the Thai navy, which controls the site, is only just beginning construction on the facility’s hangar, which will take up to four years, media reports said. “By then, the COVID situation will have eased. There is an opportunity for either Airbus or Boeing to come in,” Chokchai said to reporters. Thai Airways itself is in a fight for survival as is said to be in discussions with its government for support. The maintenance hub is part of the government’s project around the joint civil-military U-Tapao Airport, 150 kilometres east of Bangkok.

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