AviationDecision to shut down airline came as shareholders do not see path to business recovery from the impact of the Covid-19 pandemic

Coronavirus forces NokScoot out of business

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Unprecedented challenges arising from the Covid-19 pandemic have exacerbated NokScoot's demise. Credit: NokScoot
Unprecedented challenges arising from the Covid-19 pandemic have exacerbated NokScoot's demise. Credit: NokScoot

The board of directors of NokScoot Airlines has passed a resolution to terminate business and liquidate the Thailand-based budget carrier.

To date, 425 employees have been retrenched with full benefits in compliance with Thai labour laws, with a small team of staff members remaining to work on the liquidation process,– NokScoot

NokScoot was established as a joint venture between Singapore-based Scoot, a Singapore Airlines subsidiary, and Thailand-based carrier Nok Air, of which Thai Airways International has a 13.3% shareholding.

However, NokScoot has been unable to record a full-year profit since its inception in 2014, largely due to the difficulties in growing the network amid an intense competitive environment. Unprecedented challenges arising from the Covid-19 pandemic have further exacerbated the situation.

"Consequently, Scoot does not see a path to recovery and sustainable growth for NokScoot," according to Scoot in a media statement. "In considering other possible alternatives, Scoot also offered to sell its 49% stake in NokScoot to Nok Air for a nominal sum of one baht (US$0.032). This was not taken up."

To date, 425 employees have been retrenched with full benefits in compliance with Thai labour laws, with a small team of staff members remaining to work on the liquidation process, NokScoot announced in a statement.

However, the liquidation/reduction in business activities of NokScoot Airlines poses no direct or indirect impact to Nok Air’s normal operations, the company said in a Friday filing to Thailand Stock Exchange.

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