Beacon Transcript – The Taiwanese airline company, TransAsia, has released a series of unexpected announcements as it has grounded all its flights and asked to be taken out of the stock market.
TransAsia was founded in 1951 and was the first private airline company to have been founded in Taiwan.
Although one of the country’s biggest air carriers, the company has been facing increasing problems following two fatal plane crashes and major financial losses.
In a statement released late on Monday, TransAsia initially announced that starting with Tuesday, it will be canceling all its flights and bookings.
The airline company then proceeded to request the suspension of all its share trading as the company had an “impromptu board meeting” on Tuesday.
Although it offered no further details as to its reasons, the air carrier offered its deepest apologies to all the passengers that will be affected by the decision.
As TransAsia is Taiwan’s third biggest air carrier, its decision will affect quite a number of people and has come as a surprise to many more.
According to the Taiwanese Ministry of Labor, the airline has a fleet numbering about 20 planes which used to fly to destinations spread throughout 31 countries. The company is estimated to have about 1795 employees.
The cancellation of its bookings and especially its flights will also lead to a series of financial consequences.
According to Fang Zhi-wen, a Civil Aviation Authority official, the airline company will have to pay a $30,000 fine for the abrupt flight cancellations.
The fine is a consequence of the fact that TransAsia failed to respect the proper cancellation announcement period.
The flight suspension is thought to affect an estimated number of 5113 passengers. The travelers will be reimbursed within a 45 days period.
Still, most passengers are currently trying to make other traveling arrangements following the impromptu cancellation.
TransAsia also asked for its shares to be taken out of the market. According to the Taiwan Stock Exchange, which confirmed the announcement, also revealed the motivation behind the share halting.
According to it, the company requested a halt as major news were pending for release.
Most market analysts consider that the pending news are related to the potential liquidation of the airline.
The airline company has been facing increasing monetary losses over the last 21 months time period. During the first 9 months of 2016, the company reported loses of up to $69 million dollars, the equivalent of 2.2 billion Taiwanese dollars.
As it is, the registered value is almost double as compared to the loses registered in the same time period in 2015.
The factors to have led to this increasing drop of the TransAsia Airways are quite varied. A strong market competition and a decline in the Taiwan number of Chines tourists have both contributed to the debt.
Another factor, a more deadly one are the recent flight accidents as the company suffered from two crashes in less than 2 years.
Following the announcement of the flight suspension, the TransAsia shares fell by 7.14 percent before being taken down from the Taipei stock exchange.
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