King Power closing shops, cutting staff
The move is an attempt to downsize the business to allow for better operations in the long run, said Nitinai Sirismatthakarn, chief executive of King Power Corporation.
He said the closures of King Power Mahanakhon, King Power Srivaree and King Power Pattaya represent a practical solution that matches changing conditions in the tourism market.
The targeted branches were designed to attract tour groups but their revenue has declined as tourism habits are changing and more people are travelling independently, he said.
Duty-free shopping in airports does not face the same problem as they are still able to earn income from individual passengers.
Its affiliate, King Power Duty Free Co, is also in the process of seeking an adjustment to the contract for operations at five airports with Airports of Thailand Plc (AoT).
Foreign tourist arrivals to Thailand have fallen about 5% so far this year compared with the same period in 2024, with Chinese arrivals down by about 33%.
The decline has been reflected in AoT shares on the Stock Exchange of Thailand, which have fallen 35.6% since the start of this year. The prospect of a sharp drop in revenue from King Power has also become a concern for investors.
Mr Nitinai, a former AoT president who was appointed as King Power Corp's new chief executive on June 4, said the latest decision to control costs is not related to the negotiations with AoT.
He said many businesses nowadays are required to make adjustments, not only King Power.
Mr Nitinai said that staff who resign voluntarily under the redundancy programme would be compensated based on existing labour laws and the years they had spent working for the company. The firm has not set a headcount reduction target.
For employees at the three shuttered branches, if they wish to continue working with the company they will be relocated to other locations.
Established in 1989, King Power is the largest duty-free shopping operator in Thailand.
Last month, AoT approved an extension of the payment period for three contracts at five airports, allowing King Power Duty Free to pay the difference owing in instalments. Payment of some other minimum benefits specified in the contract would be deferred for another eight months.
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