MIAMI – In a decision announced today, the NokScoot (XW) board of directors has voted to liquidate the company, stating there is no recovery from the negative impact of the COVID-19 pandemic.
The Thailand-based airline was a joint venture between fellow Thailand carrier Nok Air (DD) and Singapore based Scoot (TR), a subsidiary of Singapore Airlines (SQ). XW operated low-cost flights within the Asian region.
Uphill Battle from the Beginning
NokScoot has had a tough time in the market from the airline’s start, with a representative saying it “has been operating in very challenging circumstances since its inception in 2014… Some of the challenges include difficulties in growing the network and a very intense competitive environment.”
The carrier then added that “Unprecedented challenges arising from the Covid-19 pandemic have further exacerbated the situation. Consequently, the board of directors does not see a path to recovery and sustainable growth for the airline.”
NokScoot has now become another entry on the list of victims from the pandemic, though virtually no airline in the world has been entirely unaffected by its effects in these unprecedented times.
NokScoot shareholders are slated to meet in two weeks and will reportedly come to the same conclusion as the board in terms of liquidation.
The carrier announced on June 24 that three of its seven Boeing 777-200 aircraft would be returned to Singapore Airlines, and as of June 26, 425 employees have been entrenched with full benefits in line with Thai labor laws.
A small team of the airline’s employees will be staying on to see the process of liquidation through, and will also receive entrenchment benefits once the process is complete.
Nok Air stated in a stock exchange filing that the NokScoot liquidation will not impact it at all.