KK Lee

Ground search in jungle is very limited, unless wreckage is located or position for recovery else is a waste of resources. While RMAF frontline fighters (F-18, Su-30) are all weather capability and SAR is limited to day light operation. How do they expect pilots to undertake mission at night or high risk sortie? What a moral boosting exercise.

RMAF do have 2 modern S-70 Black Hawk helicopter but for VIP transport only.

Compared with BKK and SIN, KUL market is small. If not KL is code sharing with MH to downunder, KL is likely to re-route AMS-SIN-KUL-SIN-AMS. However, KL is doing well with underbelly cargo ex-KUL.

The amount of flex for a long and thin fuselage e.g. A333 may not be noticeable except noise made by overhead bins. However, yaw motion is noticeable if viewed from the back especially in A333.

About 1/3 EY seat cushion are deflated and uncomfortable.

Are you sure? Not what we experienced on KUL/JNB, JNB/CPT sector. Total 5 times from KUL/JNB/CPT/EZE is more likely. The continental breakfast or sandwich served on MH is now equivalent to school canteen standard.

Concurred with you.

MNL T3 won’t be open anytime soon, most likely until the next president is sworn in. PR may not be the direct competitor to MH. But MH has lost OFW market shares to Middle East airlines in the last few years. Before Etihad and Emirate started service to MNL, MH was in a good position to capture OFW traffic to Middle East but didn’t bother. Likewise, many Philippinos travel to Europe with SQ and TG instead of MH because of poor scheduling. While competitors are improving, it is frustrating to see MH mindset remain arrogant and ignorant, refuse to change for the better.

IPH can handle 734, ATR, F50 and A320. Firefly doesn’t operate to KUL for international connection. IPH market is too small for regular international service. Don’t see the rational to lengthen the runway but is good reason to award contract to cronies.

More competition for MH and SQ too.

29/06: MAS: Going beyond whose expectations? Category: General Posted by: Raja Petra Biggum Dogmannsteinberg A lot have been said about the national carrier, Malaysia Airlines (MAS) these past two years. Too many people pass judgments based on mislead or wrong information, either portrayed or explicitly presented. It is no longer “who, what, where and how”. The more important question is “why”. Lets recapped what has transpired within these two years. When Datuk Idris Jala, the current MD first started, he made a statement of two pertinent points which later he never kept and honoured. One, he announced that there will be no retrenchment and redundancy, provided MAS is allowed to keep all its routes. Two, he wanted to “unleash the talents within”. It was an important starting statement as he was known as “the butcher”, for his ability to deal and break ‘tough’ unions within Shell and his intentions has clearly marked the direction he was going. When he undertook the assignment, he made it conditional that the Government allowed him to make his own decisions (no interference) and he was set to “unleash the talents within”. The Government was very confident Idris could do it, based on his experience in turnaround management in Shell. Then again, with a safety net that Shell (which promised to take him back anytime he wished so) provided, Idris was not really motivated to really succeed and place long term solutions for MAS’s predicament. Maybe he just needed to look good, so that some medium term remedy or scheme can be concocted. Now, after more than 18 months, did Idris made the right decisions? Well, one of the first thing Malaysia Airlines did was appoint Peter Read, a former British Airways as the Director of Operations. That almost caused a row. Another is Malaysia Airlines were not able to keep most of its domestic routes. The funniest of all is that FAX conveniently refuse to carry on with Rural Air Service (RAS) and Transport Ministry made MAS took it back, especially after MAS did a massive exercise to dispose of all its assets and resources pertaining to RAS operations, including retrenchment. Airline Rationalisation Plan May last year the Transport Minister announced the ‘Airline Industry Rationalisation Plan’. Part of the plan is for MAS to surrender most but 19 selected routes to Air Asia and MAS to allow its facilities cater for the needs of AirAsia. It was a gold mine opportunity for AirAsia, as they don’t have to invest a lot of money into infrastructures such as Maintenance, Repair and Overhaul (MRO) facility, something of a necessity in highly technology induced logistic corporation like an airline. It also means AirAsia is set for good profits against minimal capital expenditure and spreading massive fixed cost. To date, AirAsia have been using MAS resources and facilities and there is an RM 30 million accumulated unpaid bill. When MAS send an ultimatum to request payment, the Transport Minister instead became furious because of the call. Eventually, the Government settled the bill on behalf of AirAsia. The fact that YB Dato’ Seri Chan Kong Choy has been dubbed “Minister in charge of AirAsia” is nothing secret within the industry. The speed of getting the Low Cost Carrier Terminal (LCCT) being approved by Government and built in amazing record baffles simply baffles too many. That and another case of how an economical bus and taxi service was allowed to serve between KL Sentral and KLIA LCCT is also beyond comprehension as it was a long battle between operators and Ministry of Co-operative and Entrepreneur Development which was never resolve. The protection against a very important infrastructure purpose built for KLIA, the ERL, which was immediately lifted when the Minister allowed direct economical bus service from KL Sentral to commence. Another important point not made known to public is that the last 3-4 years, anytime MAS requested additional routes for Transport Ministry acquire within the region, it was summarily denied with the verbal excuse that those routes would now be ‘reserved’ for AirAsia. For example, additional routes to Jakarta, Bali, Medan, Bangkok and new routes to Hadyaii. MAS Rationalisation Plan Idris promised an increased yield on routes operated by MAS. The fact that MAS never achieved real cost reduction but some of the routes start to make money. A better revenue management system were put in place and thus the significant shift in the net income curve. The restructuring of the airline industry is being made by a ‘power’ where MAS does not have a hand in it. This was clearly shown the week Idris went to see the Prime Minister and presented him with the MAS Rationalisation plan. The Prime Minister got his office to work at MAS’s proposal the remaining of the week. Over on Saturday, it was said that Khairy Jamaluddin brought AirAsia Boss, Tony Fernandes for a private meeting with the Prime Minister at Seri Perdana private residence. The next morning, Khairy and PM’s Office Head of Policy Zaki Zahid came into the office and reworked all the papers already prepared. By evening, the Chief Private Secretary to the Prime Minister received a call with instructions for him to personally leave for the Caribbeans immediately and assist Wisma Putra in forming a new Charge D’Affaires office, as a subsequent action from the PM’s recent visit. Personal touch and previous experience was given as the excuse to get him out of office. By the next Cabinet meeting, almost everyone in MAS’s turnaround project had a major surprise. Government announced almost all but 19 domestic will be operated exclusively by Airasia. This announcement was the backbone of AirAsia’s expansion program and justification for their massive asset acquisition, especially to the financiers. MAS also brought in Bernard Francis from AirAsia and he was given a very senior post. Considering that his limited experience was running a regional low cost airline, now he is expected to transform a tier-1 intercontinental major airline around. The formation of Fireflyz is also baffling for the industry. Eddie Leong, a new talent without any logistics nor airline experience were brought in from outside, is made to run the show. Now MAS is expected to maintain two tier airline service within the same company. Conveniently less than one month after Firefly was launched, AirAsia announced they wish to let go the FAX and transfer all RAS routes back to MAS. The transfer of RAS to FAX did not come without controversy. FAX, in their typical money making mode, significantly reduce frequency of many RAS routes in the interior of Sabah and Sarawak which disrupted the rakyat’s convience and lifestyle. So much attention and so many political reps from both states made strong criticisms against the RAS services provided by FAX and wanted the old service provided by MAS to be reverted. Historically, MAS was formed in 1972 after the Singaporean part of MSA wanted to focus on commercial growth and agenda where else Malaysia still maintained national integrity and economic development programs as a priority. Hence MAS and SIA was born and MAS continued serving the much needed logistics service. “Developing talents within” This was something Idris announced what he wanted to do when he first took over the helm of MAS. Being a HR man, it was not surprised the Shell ‘culture’ of developing highly skillful specialists of the industry was his theme to address the solution for MAS. However, something else prevailed. No real “developing talents within” efforts were carried. Instead, MAS went of a massive “retrenchment” exercise, by allowing 3,900 people of the originally intended 6,500 to take the ‘mutual separation scheme’. More MSS exercise will be carried out as soon as the ‘new talents’ figured their way around the company and/or industry. In place, Idris brought in too many newbies with little or no experience in an airline or aviation industry in. Some of them carried their high maintenance ‘baggage’ with them to MAS. Most of them, from other organizations. Therefore, new cultures and work ethics were brought in and some personality and practice clash is starting to develop. Also, as in any MNC, MAS is now in a state of high dependency on external consultants, especially from abroad. Too many middle managers and loyalist were sidelined and pushed aside. A lot of their valuable experience and knowledge were not tapped but instead expensive external consultants are procured. Training programs for existing employee and management were frozen silently. However, the ‘new people’ had to undergo expensive training abroad and highly dependent on external consultants to bring their work, up to speed. MAS, went into a conundrum where they had to bring in people which “ask to borrow your watch to tell you the time”. Even the turn around process and team are highly dependent on the external talents brought from outside and exorbitantly expensive consultants. Idris was even quoted to talk about bringing in imported talents from abroad, especially Europeans into MAS, like how Gulf states airlines are like, where else valuable experienced local talents were systematically allowed to leave, at a high departure cost (MSS scheme). Naturally, like in the case of Proton, the new management have managed undermined the spirit of the larger MAS workforce. The moral is an all time low, especially a lot changes that affects the welfare of the employees, such as selective bonus and reward schemes, new leave system and other perks they used to enjoy. HR related decisions made by a new HR man like Idris and the high salaried executives he brought in will one day backfire adversely to the company. The aircraft replacement program and exit plan This was and still is an important point which left too many people continuously wondered. The current 39 B737-400 fleet is 19 years old and due for replacement. The replacement program is valued at RM 11 billion and expected to invite too many interested party. It is a commitment MAS inevitably have to make at some point of time. However, there is another twist of the probable direction of MAS. AirAsia since two years ago, have been making massive 150 unit order on A320s, as part of their bullish expansion program. That, will be a serious financial commitment, even for a highly profitable company. Recently, this is the latest financial review on AirAsia, by Citigroup. The Edge, has the story: 25-06-2007: Citigroup: Sell AirAsia to take profit CITIGROUP Equity Research has recommended investors to sell AirAsia Bhd shares to take profit, given the low-cost carrier’s rich valuations and its rising investment risks. With a PE of 22 times, AirAsia was trading at 23% premium to global sector peers with similar earnings per share growth and 24% premium to the Malaysian market. The research house rated AirAsia as “sell/high risk (3H)”, with a 12-month target price of RM1.66. “We remain bullish on the prospects for budget air travel in Asia. AirAsia, in our view, is so far the cleanest play, with some competitive advantage and a significant beneficiary of the domestic route rationalisation, is emerging as the dominant player. “However, we are concerned about rising investment risks given lower earnings visibility and potential share overhang. There is greater uncertainty on historical and future reported earnings due to existing accounting policies on the treatment of deferred tax, investment allowances and hedging instruments,” it said. Citigroup added that there could be potential share overhang given recent significant off-market transactions that led to a reduction in Tune Air Sdn Bhd’s stake. “We estimate AirAsia’s net debt to equity level would rise to circa 300% by FY09E and AirAsia will likely need to raise more capital to fund the remainder of its Airbus aircraft purchase as its gearing level is already high,” it said. Citigroup also said AirAsia had garnered a significant market share of 50%, compared with 30% in FY06, in less than a year since the domestic route rationalisation took place. Domestic routes contributed about 70% of AirAsia’s revenues and were expected to remain the main driver of earnings due to the significantly stronger competition on international routes, it added. While traffic growth had moderated in recent months given AirAsia’s larger base, new routes, namely Kuala Lumpur-Shenzhen, Johor Bahru-Macau and Johor Bahru-Langkawi, should help boost its growth. Citigroup said it expected AirAsia to meet its forecast FY07 recurring profit forecast of RM198 million or a reported profit of RM400 million, if the Malaysian Accounting Standards Board approved the inclusion of deferred tax credits in AirAsia’s audited accounts. However, it said rising fuel prices remained a key concern in FY08, given that fuel accounted for 50% of AirAsia’s operating costs and it was unhedged from July 2007. The skepticism and realism is starting to sink in after the over-kill on “hoohaaa” and “ga ga” and marketing gimmicks simmered down. AirAsia is an airline operator, trying to behave like a full fledge airline without proper technical assets and infrastructure. Therefore, the growth expansion AirAsia has set as target is now beginning to feature as ‘not too convincing’, especially their growth saturation is expected to stabilize sooner than expected, especially with more upcoming regional players in India and China, AirAsia’s two biggest potential market. Some believe all the commitments AirAsia placed, especially after its major players in the likes of Tony Fernandes made their exit plan, will have to be taken over by MAS eventually. Therefore, some already beginning to embrace MAS B737 replacement program is about MAS merging with AirAsia and taking over the orders placed. The end game MAS’s end game is almost too clear now. Idris Jala has been making statements that MAS’s performance has shown positive results the past few quarters. He even confidently announce that MAS is “expected” to have ‘favourable’ results for the next consecutive six quarters. There are some people, most probably within Khazanah, who wants to see MAS shares plateaud at RM 8.00. So that is where Idris is expected to do. Most probably Khazanah will recommend that MAS be sold of to realize commercial gains, much like what Proton is going through now. The signs are starting to show. “Fresh talents” like Bernard Francis has been rewarded handsomely for their short stint. Recently he was offered 600,000 MAS shares, as a reward under the ‘selective ESOS program’. So did the other top and senior management brought in from other industries, like oil and gas and advertising and promotions. Almost the remaining other top performing loyal managers. who were seasoned airline professionals however were not considered at all in the most recent rewards exercises. Inevitably, moral dropped to a new all time low. Like Proton, MAS professionals are greatly demotivated and adversely charged. An organisation with low moral cannot sustain long term success, even if better systems and work processes are in placed. In an enigma hybrid between high technology and high standard hospitality, a tier-1 intercontinental airliner like MAS very much needed to take care of its most valuable assets, the people. So if the solution that Khazanah executives expect to put in place for national corporations and ‘pride’ of the nation such as Proton and MAS is based totally on commercial grounds and so much weightage given on PEs, ROIs, EBITDAs, et al, then we might as well embrace ourselves for MAS’s “going beyond expectations”. Really beyond expectations! http://malaysia-today.net/blog2006/index.php?itemid=5923 Another rumours?!

The Sabah and Sarawak network has remain unchanged for over 30 years. ATR is F50 replacement just like F50 to F27. If ERJ or CRJ is chosen, may transform the network. Then again, if FAX can’t touch the network, why rock the boat? Mas management is not paid to think outside the box. Just my 2 cents

Believe the ATR-72 ordered by PMB has caught many Mas folks by surprise. The decision to buy which aircraft is made by Khazanah/PMB. Mas was only asked for the number needed and some opinion. The government bought A319 ACJ instead of 737 BBJ means the Airbus promoter’s cable to the top is thick and strong. Unless Idris Jala threaten PMB with ultimatum or resignation, A380 order is unlikely to cancel. Since MH is working well with KLM on kangaroo route, A380 is viable for KUL/SYD route provided MH don’t mess up like it did with NW years ago. Just my 2 cents.

Abdullah wedding

In Malaysia, 90% of the rumours tend to be true at the end. The list may not be fully accurate but I wouldn’t disqualify him either.

We all know Mas Engineering service aircraft type not operating by MH. The question was how often? 20%, 30% or 50% of time sheet? MAS Q1/07 net profit is RM133 million. In 2002, PMB absorbed RM9.0 billions of debt from MAS along with about RM700 millions interest payment per year. MAS is not a conventional airline. Is MAS really profitable? If Alitalia is given similar opportunity, its profit may be better than BA or LH. Believe many decisions made are still for non commercial reasons. I stand to be corrected in 3 years time.

No one is complaining MAB is upgrading satellite terminal for A380. But solely for the benefit and comfort of diverted A380 from SIN is hard to buy. The MH engineering do service other airline customers and is profitable. May be you like to share with us, how often does the engineering service aircraft not operating by MH eg 737NG, 757, 767, A320, A340. If the engineering is going to be type rated on A380, why not 787? As there will be more 787 than A380. Buying or cancelling aircraft order is unlike ordering dinner in restaurant. Airline has to consider training, support, finance, etc. To write off sunk cost at this stage, would only means it was a VERY bad decision to sign the A380 contract. There is no doubt Jala Idris tried very hard to improve the airline but believe many obstacles are taller than him. Understand breakeven load factor, passenger load factor, passenger yield, CASM and RASM are popular benchmark to gauge airline performance. May be you like to enlighten us with MH’s numbers to compare with SQ, CX, TG, etc. It is undisputable that assistance from PMB contributed substantially to MH operating income. Curious to know how will the PnL look if truth cost is reflected. If NST is to be believed, then Proton saga is the greatest and best car in the world, still popular after more than 20 years in production. As I am lucky to have opportunity to travel with different airlines so able compare. My criticism is for MH and the country to improve, to compete and excel internationally. Unfortunately, many people are still living ignorantly in the false hope of ‘Malaysia boleh/bodoh’ spirit, unable to accept facts, numbers, and the world is flat. Optimistic may give hope to people, the question is how realistic and plausible?

I believe you the one who is wearing defective eyewear. I didn’t say anything negative about having A380 capable terminal or hanger in my post. I don’t only observe but travel on MH as a pax. I am lucky to have the opportunity to compare MH with other airlines. If MH can’t accept criticism, it is no wonder the gap between SQ and MH is widening every years. I stand to be corrected if MH cancels A380 order.

31” pitch and 9 abreast on a long haul A330 won’t be comfortable but if ticket is cheap enough, more people will choose AK than full service carrier.

FAX = Flights Always Xancel

If the government/politician can be trusted, pig can fly!

Believe AK is fully aware of DCA regulation, AK must have obtained consent from DCA before they sign contract with the supplier. Furthermore, TF is very influential in the local aviation industry, he won’t have much difficulty to get the regulation changed to his favour. I just dislike them to have deceived us for many years! :angry:

A380 hanger, upgrading of satellite terminal for A380 at KUL is nearly complete and A380 is a ‘must have’ for a ‘world class’ airline. Bet my 2 cents MH won’t cancel the A380 order. If to judge by past record, we can expect MH to slash ticket price on the kangaroo route to fill A380, going for another spiralling low yield, poor service trend. Old wine in new bottle, despite a few change of CEO, nothing much has changed or improved since 1990’s.

The myth that using hand phone onboard is unsafe finally busted in Malaysia. Not that I like fellow pax yelling to the handphone in a confined space; like many things in this country, we have been deceived for years. About time that Malaysians are updated with truth and technology.

On and around 6th June, Oman was hit by cyclone Gonu and probably the air space was closed because flights were suspended at Muscat airport. Transit in Bombay for 12 hours is to allow tech crew sufficient rest. MH flight operation should have anticipate this weather and could have re-route to avoid the cyclone.