TG cancels codeshare deals with key *A partners

[Keith T 2]

http://www.flyertalk.com/forum/showthread.php?t=513911

 

I wonder what people make of this.

[Y. J. Foo 0]

Interesting...

 

Some people would say they are switching alliances, but wasn't TG part of *A founder?

[Sandeep G 1]

This could be where TG announces they are joining Skyteam... and MH would thus look much better in OneWorld.. how accurate is your source Keith? Have you heard anything else about MH joining OW?

[Jamie H 0]

This could be where TG announces they are joining Skyteam... and MH would thus look much better in OneWorld.. how accurate is your source Keith? Have you heard anything else about MH joining OW?

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Sounds plausible.....this could also be the reason why AF's been stalling MH's entry into Skyteam - wait for TG to pull out of Star

 

Now before people start throwing their shoes at me, could the rumours of MH possibly considering OW also be secondary to the ongoing hearsay of CX leaving OW?? I remember reading it off somewhere - flyertalk possibly or even a.net - though it does sound ridiculous, it isnt impossible.....Think about it, CX isnt exactly the best of friends with QF are they? Plus......again another hearsay- CA (a potential Star member) buying shares into Swire Group (CX's Stockholders)

 

Anyhow.....any rumours or confirmed news of MH joining OW is grand news to me

[Keith T 2]

This could be where TG announces they are joining Skyteam... and MH would thus look much better in OneWorld.. how accurate is your source Keith? Have you heard anything else about MH joining OW?

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Not much else. Sources are pretty accurate. Been sworn to secrecy over identity of sources.

[Sandeep G 1]

hahahaha yeah, I think MH in OW could work.. but is QF and BA willing to move to KLIA??????????? This is where it gets confusing..

Could everyone be dodging MAS as well because they were aware of previous management practices at the airline??? I mean, it is afterall quite plausible that MH has been sidelined by the alliances, rather than what we have been speculating as MH sidelining the alliances??

[Keith T 2]

hahahaha yeah, I think MH in OW could work.. but is QF and BA willing to move to KLIA??????????? This is where it gets confusing..

Could everyone be dodging MAS as well because they were aware of previous management practices at the airline??? I mean, it is afterall quite plausible that MH has been sidelined by the alliances, rather than what we have been speculating as MH sidelining the alliances??

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A major hurdle for MH in joining oneworld is its financial crisis. A criteria for joining ow is profitability. But I guess if they really want MH in their folds, they could initially sign an MOU with the airline which involves a promise to re-structure and return to profitability by MH (ala MA), and full membership once those conditions are met.

 

BA and QF do not need to move to KUL. They could sign an exclusive interline agreement, or even a codeshare deal, with MH on SIN-KUL vv, BKK-KUL vv etc. MH already has a codeshare agreement in place with CX, so MH's ow membership would turn the HKG-KUL vv sector into a cosy oneworld route, much like HKG-MEL. MH would definitely boost ow's presence in South East Asia.

[Pieter C. 5]

A major hurdle for MH in joining oneworld is its financial crisis.

 

Same for Skyteam, especially if they want to join as a full-member ... even the relationship with KLM has turned a bit sour lately, because of "financial" (code-share ?)matters and the previous request of MH to become a full-member i.s.o. an associate-member for the time-being...I do believe, TG "smells" opportunities here, and is, therefor, loosening up on the Star-Alliance (it is known they think SQ is too dominant in Asia), either to become a Skyteam member, or to put some kind of pressure on MH to decide what to do, as this has been limbering on for too long now...

If TG will join Skyteam, MH can forget it for being/becoming a major Asian carrier on the lucrative Europe-Australia market (AF-KL will channel all "down-under" traffic through BKK i.s.o. KUL/SIN in that case).

 

On the other hand: JAT has become the 3rd full-member East-European airline of Skyteam (according to the Dutch site www.luchtvaartnieuws.nl), after CSA and Aeroflot (Tarom is an associate-member)...

 

[Sandeep G 1]

with the restructuring exercise and the rationalisation of routes, MAS is simply not marketable to any alliance at the present time.

 

Ridiculous reports that 79 out of 115 routes operated by MAS (That's intl. and domestic flights) are UNPROFITABLE are for sure not presenting an attractive image of MAS to the alliances. Profitability, self sustainability and operational efficiency are what MAS needs before it can even think about joining an alliance. One year ago, I believed myself that MAS was increasingly leaning towards flying high and the corruption and fiscal crisis experienced over the millenium crossover period (begining in 1997 AFC) was largely over. Alas, we see today the true state of affairs at MAS and now we can only hope that MAS can survive and return to its once proud position at the top of carriers in the Asia-Pacific region and perhaps even the world!

[Keith T 2]

with the restructuring exercise and the rationalisation of routes, MAS is simply not marketable to any alliance at the present time.

 

Ridiculous reports that 79 out of 115 routes operated by MAS (That's intl. and domestic flights) are UNPROFITABLE are for sure not presenting an attractive image of MAS to the alliances.  Profitability, self sustainability and operational efficiency are what MAS needs before it can even think about joining an alliance.  One year ago, I believed myself that MAS was increasingly leaning towards flying high and the corruption and fiscal crisis experienced over the millenium crossover period (begining in 1997 AFC) was largely over.  Alas, we see today the true state of affairs at MAS and now we can only hope that MAS can survive and return to its once proud position at the top of carriers in the Asia-Pacific region and perhaps even the world!

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IMO MH spreads itself too thinly. No one wants to fly on an airline who can only provide 3 weeklies to tonnes of destinations and no alliance membership to make up for the shortfall, rather than daily flights to a few high yield destinations and have an alliance to manage the rest. No one likes planning their trips around which days an airline flies, especially businessmen (read: premium class pax) on tight schedules. That's a key reason for unprofitability I guess. In this regard QF provides an excellent model - the airline has dropped destinations like CDG and FCO where it could not get rights to land daily and instead has established a codeshare presence in those ports with BA and CX respectively. This allows QF to consolidate its resources on profitable destinations.

 

MH does not need a huge route network worldwide to market itself to an alliance. Its good regional network is sufficient, as established players in an alliance do not like introducing new players who would threaten their own network. It is about how the newcomers can enhance the alliance - in MH's case - its excellent presence around South Eastern Asia, and generally good presence in Australia which would enable codeshare deals with the Flying Roo.

 

As for MH's relationship with KLM and Skyteam, I noticed that Flying Blue members no longer earn EQMs on MH, only redeemable miles. A sure sign of things...

Edited January 16, 2006 by Keith T

[Sandeep G 1]

Keith,

 

Believe you me, MH has been fighting for daily services into places like Manchester, CDG and Newark and multiple daily services into places like SYD and MEL.

 

Alot of the european services must be upheld in order to compete with SQ and TG. Rome, Zurich and Vienna are the three that spring to mind. MAS could drop these routes and if they join OW, codeshare with BA... but what's the point of pax going all the way to London, and back into Europe??? The routes provided by MAS can be expanded to daily services in the advent of them joining an alliance to carry pax from Australia to these destinations.. this is afterall how SQ sustains itself.

 

Bottom line is not where the aircraft flies.. Keith, you must remember that the routes that MH flies to 3 times or 4 times weekly are in actual fact quite busy with traffic and average 72% load. The load needs to be addressed to about 80%, but to make these routes profitable, MH needs to cut its overheads! and this is where money politics and corruption are rampant..

 

This is hopefuly being addressed now, but in the forseeable future, I would prefer MAS to go it alone for the next year, and then reconsider joining an alliance.. I don't think MH should rush in and join an alliance in its present state.

 

The focus on China and India and the region is very important.. more connections are needed between Bangkok and KL, Jakarta and KL and definately Singapore and KL. Tokyo, Hong Kong, Taipei, Shanghai, Guangzhou, Beijing need at least 3 daily services, with good connections from Europe and Australia... MAS has lower costs than all other airlines in this region, yet it continues to lose money.. This is the problem with MAS and I can't reiterate enough.

[Keith T 2]

Keith,

 

Believe you me, MH has been fighting for daily services into places like Manchester, CDG and Newark and multiple daily services into places like SYD and MEL. 

 

Alot of the european services must be upheld in order to compete with SQ and TG.  Rome, Zurich and Vienna are the three that spring to mind.  MAS could drop these routes and if they join OW, codeshare with BA... but what's the point of pax going all the way to London, and back into Europe??? The routes provided by MAS can be expanded to daily services in the advent of them joining an alliance to carry pax from Australia to these destinations.. this is afterall how SQ sustains itself. 

 

Bottom line is not where the aircraft flies..  Keith, you must remember that the routes that MH flies to 3 times or 4 times weekly are in actual fact quite busy with traffic and average 72% load.  The load needs to be addressed to about 80%, but to make these routes profitable, MH needs to cut its overheads! and this is where money politics and corruption are rampant..

 

This is hopefuly being addressed now, but in the forseeable future, I would prefer MAS to go it alone for the next year, and then reconsider joining an alliance.. I don't think MH should rush in and join an alliance in its present state. 

 

The focus on China and India and the region is very important.. more connections are needed between Bangkok and KL, Jakarta and KL and definately Singapore and KL.  Tokyo, Hong Kong, Taipei, Shanghai, Guangzhou, Beijing need at least 3 daily services, with good connections from Europe and Australia...  MAS has lower costs than all other airlines in this region, yet it continues to lose money..  This is the problem with MAS and I can't reiterate enough.

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High load factors does not necessarily equate high yields. As I understand it MH attracts mainly leisure (economy) pax. I'm not arguing that the lack of daily flights is a sole factor but it's certainly a big one in terms of attracting high yields.

 

Point taken about routing everything via LHR. But there's always CX. (now I'm just s#1t stirring)

 

Excellent argument about overheads and corruption. Can't agree more. Anyway everything I read about MH has been from the media and I've been trained to be critical of the media's agendas, so people might want to enlighten me more about the situation with MH. Like, why has it been bleeding money so badly even though it has a relatively low cost base? Can't be just corruption... after all corruption happens at most big corporations to some degree. You just learn these things after being in politics and noticing the political connections in the busines world.

Edited January 17, 2006 by Keith T

[Sing Yew 1]

High load factors does not necessarily equate high yields. As I understand it MH attracts mainly leisure (economy) pax. I'm not arguing that the lack of daily flights is a sole factor but it's certainly a big one in terms of attracting high yields.

 

Point taken about routing everything via LHR. But there's always CX. (now I'm just s#1t stirring)

 

Excellent argument about overheads and corruption. Can't agree more. Anyway everything I read about MH has been from the media and I've been trained to be critical of the media's agendas, so people might want to enlighten me more about the situation with MH. Like, why has it been bleeding money so badly even though it has a relatively low cost base? Can't be just corruption... after all corruption happens at most big corporations to some degree. You just learn these things after being in politics and noticing the political connections in the busines world.

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Media agenda setting theory.