The Covid-19 pandemic claimed another victim: the regional low cost NokScoot is closing. Although the company’s board of directors decided yesterday to liquidate the airline, the decision will be announced at a general shareholders’ meeting in 2 weeks. The measure will leave about 450 employees unemployed, except for the few who will stay to work in the liquidation process. The company promises to pay all benefits in accordance with Thai law.
NokScoot was a joint venture between Scoot and Nok Airlines, a Thai low cost established in 2004 that owns 51% of the shares. Scoot, a subsidiary of Singapore Airlines, owns the other 49%. Thai Airways, now bankrupt, has a 13.28% stake in Nok Airlines.
NokScoot operated medium and long-distance Asian routes to 7 cities in China and 3 in Japan, as well as New Delhi, Singapore and Taipei, from its base at Bangkok’s Don Mueang airport. Even before the coronavirus outbreak, it was in trouble from intense competition from other low-cost companies. NokScoot will return 3 aircraft from its fleet of 5 to the parent company in Singapore in late June.
“The unprecedented challenges stemming from the Covid-19 pandemic have further exacerbated the situation. Consequently, Scoot does not see a path to recovery and sustainable growth for NokScoot.
In considering other possible alternatives, Scoot also offered to sell its 49 percent stake in NokScoot to Nok Air for a nominal sum of 1 Thai baht. This was not accepted. Unfortunately, we had to make the decision to go ahead with the settlement. Thailand remains an important market for the Singapore Airlines Group. Singapore Airlines, SilkAir and Scoot are committed to continue serving customers in Thailand with their existing operations. “