Taiwan’s TransAsia closes down after fatal air crashes

By Ikenga Chronicles November 22, 2016

Taiwan’s troubled TransAsia Airways on Tuesday said it would suspend operations temporarily following two incidents of plane crashes, massive financial losses and an insider trading probe.

This decision was disclosed by the Chief executive officer Liu Tung-ming after an emergency meeting with board members, describing it as a “painful” decision.

“I’m sorry that our recent efforts could not meet public expectations,” Liu said. “The board meeting convened today has approved the decision to dissolve the company and suspend all flights from today. The decision will be formalised by a shareholders’ meeting next January.”

“We choose to dissolve the company at this time when we are still able to take care of our employees and passengers,” said chairman Vincent Lin.

He therefore promised that all tickets would be refunded after disclosing that the suspension of flights was estimated to affect 100,000 passengers.

The dramatic crash of flight GE235 in February 2015 grabbed global headlines as car dashcam footage showed it clipping a road bridge and careering into a river shortly after take-off from Taipei, killing 43 people. An investigation blamed a catalogue of pilot errors, with one found to have mistakenly switched off the only functioning engine after the other had failed.

It came just seven months after another jet slammed into trees and houses near Magong city on Taiwan’s scenic Penghu island, leaving 48 dead. The pilots were flying below the minimum altitude required in poor visibility in a procedural mistake widespread among TransAsia’s pilots at the time, the Aviation Safety Council said in its investigation report.

TransAsia, Taiwan’s first private airline, was set up in 1951. It said it had introduced six training programmes following the two crashes. Despite moves to combat safety fears, it incurred losses of Tw$1.1 billion ($34.38 million) last year as load factor plummeted to 20 percent. Those losses widened to Tw$2.2 billion in the first three quarters of this year, and in October its budget airline V Air folded.

Its woes were exacerbated by a slump in Chinese tourists as relations with Beijing worsened under Taiwan’s new president Tsai Ing-wen.

Lin said the airline currently incurs a daily loss of Tw$10 million even though load factor has improved to around 60 percent.‎

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