AOT going ahead with airport expansion plans despite expected Bt10-bn operational loss

[webfact]

AOT going ahead with airport expansion plans despite expected Bt10-bn operational loss

By THE NATION

 

 

Airports of Thailand (AOT) expects operational losses at Bt10 billion in fiscal year 2021 for the first time since its establishment 40 years ago, AOT president Nitinai Sirismatthakarn said.

 

“However, with the current cash flow of Bt32 billion, AOT would continue to expand six airports in 2021 as planned, with total investment of Bt92 billion,” he said.

 

Nitinai added that this year AOT would propose a plan for expansion of the eastern, western and northern terminals at Suvarnabhumi Airport, aiming to accommodate 120 million passengers per year.

 

“Total investment for expansion at Suvarnabhumi would be close to Bt60 billion,” he added.

 

“The rest Bt32 billion investment will include the third phase of Don Mueang Airport expansion, which consists of constructing a new southern terminal to replace the existing domestic terminal.

 

“AOT is now conducting environmental impact assessment of the Suvarnabhumi and Don Mueang projects and expects to submit the proposals to the Ministry of Transport and the Cabinet within May. The bidding process could start before the end of 2021,” Nitinai said.

 

Despite a projected loss in 2021, Nitinai is confident that the company’s situation will improve by the end of 2022 when the Covid-19 vaccine should become widely available in Thailand and international travel should be fully restored.

 

“With enough cash flow we will not need to borrow additional funds in 2021,” he added. “Furthermore, in 2020 we managed to reduce our cost by 29 per cent and expect to further reduce 9 per cent this year.”

 

Currently AOT’s airports have around 15,460-25,000 passengers per day, dropping drastically from the average 200,000 passengers per day before Covid-19, which generated cash flow of Bt40 billion annually.

 

Source: https://www.nationthailand.com/news/30401450

 

 

-- © Copyright The Nation Thailand 2021-01-19

 

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[ThailandRyan]

Another well thought out plan that can't wait until the world recovers from Covid and there is a demonstrated need.  Must have learned from China and the Ghost cities they have built.  Will Suvarnabhumi become a ghost airport like in China.

Lovely airport, where are the planes? China's white elephants emerge | Reuters

 

34 Pictures Inside The Startlingly Empty Ghost Cities Of China (allthatsinteresting.com)

Edited January 19, 2021 by ThailandRyan

[internationalism]

Surely they have lost, at least, 10bln this year. 
they will be losing as much for the next 5-10 years, after that their profits would never be as high as before. 
As a governmental organisation they can always ask for handouts, as thai airways. 
 

the thing is, the more they invest, the bigger chances for corruption with contractors and bigger governmental help, again giving an Opportunity for skimming some of money. 
 

singapore closed down the second terminal at the very beginning of pandemic. 

[welshguy]

Hmmn,...

 

What with covid, and most economies around the world in freefall...  Airports expansions etc. would be bottom of the list for most governments to spend their money on I would have thought?!

[varun]

Textbook escalation of commitment