The regional budget airline NokScoot is closing down after saying it cannot recover from the impact of the COVID 19 outbreak.
The carrier said its board of directors decided on Friday to liquidate the airline, with the decision to be announced in a general meeting of shareholders held in two weeks.
The decision will leave 450 staff members unemployed, save for some who will work on the liquidation process. The company promised to pay them their full benefits in accordance with Thai law.
NokScoot was established in 2014 as a joint venture between Singapore-based Scoot and SET-listed Nok Airlines Plc. Nok, a domestic budget carrier established in 2004, holds 51% of the shares and Scoot, a Singapore Airlines subsidiary, holds the remaining 49%. Thai Airways International, now under bankruptcy protection, holds a 13.28% shareholding in Nok Airlines.
NokScoot operated medium and long-haul Asian routes serving seven cities in China and three in Japan, as well as New Delhi, Singapore and Taipei, from its base at Don Mueang airport in Bangkok. Even before the coronavirus outbreak began, it was struggling in the market due to intense competition from other low-cost carriers.
A board member said on Friday “Unprecedented challenges arising from the COVID 19 pandemic have further exacerbated the situation”.
There had been speculation that the company would exit the business after it announced employee layoffs.
NokScoot will return three aircraft from the five-jet fleet to the parent company in Singapore by the end of this month.