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Firefly may take MAS jets to expand

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In the most bizzare news, MH is intending to put give firefly their 734's in a move to combat competition from LCC's.

 

At the moment, firefly has got a nice reputation of its own, clean new turboprops but if this happens then the overall age of firefly aircraft will be of 16 years, as opposed to 1 year currently.Note that the life span of an a/c is 16 to 20 years (this if good maintainance is kept)

Shoudnt they sell these 734's while they can and use the money to beef up their own fleet?

 

It seems that the aviation sector in Malaysia is moving backwards as compared to Indonesia,

 

http://www.btimes.com.my/articles/ffjets-2/Article/

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If actions and deals within MH are clear and logical to commoners like us, it would not be in such a state now....we are nothing but keyboard warriors

Edited by V Wong

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Its good to have more airlines at KLIA/LCCT. More choice for consumers if there is more competition. Similarly, SZB should also open up to all airlines so that pax have a choice to fly from whichever airport they like.

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From Business Times:

 

If a plan by parent MAS to allow Firefly to take over its B737-400s from year-end materialises, it can only spell good things for the national carrier.

 

THREE years after it took off as a full-service community airline aimed at serving primarily secondary airports in the country and those within the Indonesia-Malaysia-Thailand Growth Triangle, turboprop operator FlyFirefly Sdn Bhd is poised to fly higher.

 

If a plan by parent Malaysia Airlines (MAS) to allow Firefly to take over its B737-400s from the end of this year materialises, it can only spell good things for the national carrier.

 

The move can be viewed as a "counter-strike" of sorts against its competitors and a ploy adopted by other carriers like Singapore Airlines (which set up Silk Air to ply regional routes), Qantas (with its low-cost domestic subsidiary Jetstar Airways) and Thai Airways (which has Nok Air).

 

Besides regaining the market share it has lost in recent years on domestic and regional routes to low-cost competitors like AirAsia, MAS can also look at returning to a path of growth.

Domestic and short-haul routes, which previously bled MAS and were deemed unprofitable and axed, can now be revisited and served by Firefly.

 

Even new regional routes to neighbouring countries that have not been tapped can now be new destinations to be offered.

 

By coming together with Firefly and working towards greater cooperation to create synergy, the issue of competition with its parent firm is not likely to arise as both parties will continue to work in the interest of MAS.

 

For Firefly, which currently operates with seven ATR 72-500s and another three by the end of this year, the addition of the bigger B737-400s into its fleet can only lead to better times.

 

Meanwhile, how the potential developments are set to affect low-cost carrier AirAsia remains to be seen.

 

The obvious effects are that more competition can be expected in terms of ticket pricing, and perhaps for human resources like air and ground crew.

 

The carriers will also be in direct competition for some of the routes and sectors which one and not the other is serving.

 

Apart from the used planes, which Firefly is likely to be using if it leases or buys the B737-400s used by MAS, the community airline is not likely to bring any other "baggage" into the new scheme.

 

And this would be unlike AirAsia, which started as a debt-ridden airline owned by DRB-HICOM Bhd and later sold to Datuk Seri Tony Fernandes' firm Tune Air Sdn Bhd for RM1 with a liability of over RM40 million and two ageing Boeing planes.

 

Fernandes turned around the airline and grew it into a global and award-winning brand.

 

By entering the secondary aircraft market, Firefly is not likely to be saddled with financing costs of new aircraft.

 

It is also expected to benefit from cost advantages when tapping into maintenance, training and information technology system services for which initial costs have already been recovered.

 

While the maintenance costs for older planes are known to be higher than newer ones, the strength of MAS' maintenance, repair and overhaul business will ensure that costs to Firefly will be incremental, not dramatic.

 

Over and above the impact which would be felt by any airline if Firefly expands its fleet to include the Boeing jets, the economic spinoffs must also be considered.

 

Besides creating more jobs for pilots, air and ground crew, consumers are likely to be the greatest beneficiaries and being spoilt for choice with possibly even lower fares.

 

If Firefly chooses the KL International Airport in Sepang as the base for its jets, the airport's quest of turning into an aviation hub it was meant to be in welcoming a lot more passengers will be boosted.

 

Source: http://www.btimes.com.my/Current_News/BTIMES/articles/anaj/Article/

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Firefly May Lose Advantage By Using B737-400s Planes, Says OSK

 

KUALA LUMPUR, April 22 (Bernama) -- Community airline, Firefly could lose its advantages and intensify competition in the low cost carrier (LCC) segment should Malaysia Airlines deploy the old B737-400s to Firefly.

 

OSK Research Sdn Bhd said Firefly may obviously face roadblocks in operating the B737-400s through Subang, and hence may be forced to choose Kuala Lumpur International Airport or the Low Cost Carrier Terminal (LCCT).

 

"The move would only further intensify the already stiff competition in the segment should Firefly lose its advantage of operating in Subang, which is closer to its passengers," OSK said in its research note here on Thursday.

 

Malaysia Airlines managing director Tengku Datuk Azmil Zahruddin was reported saying that the national carrier was evaluating several options to optimise its B737-400 planes including deployment of the planes to Firefly.

 

OSK said the move also contradicted Malaysia Airlines' strategy to reduce cost.

 

Given the fact that low cost carrier passengers expect cheaper air tickets, every single cost item will be important in enhancing a low cost operator's competitiveness.

 

Malaysia Airlines' strength is in the maintenance, repair and overhaul business but operating the old aircraft may still translate into high maintenance bills, the research house said.

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In the US, Delta is busy buying up old MD-90s because they are cheap to buy - so less strain on financing. At the end of the day, it is the Total Cost of ownership that matters. So is it cheaper for Firefly to own/lease and operate old 734s or better to go for the high cost new 738s or A322s? Only they know the numbers...

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In the US, Delta is busy buying up old MD-90s because they are cheap to buy - so less strain on financing. At the end of the day, it is the Total Cost of ownership that matters. So is it cheaper for Firefly to own/lease and operate old 734s or better to go for the high cost new 738s or A322s? Only they know the numbers...

 

SOMETIMES LESS IS MORE. Its better to have less aircraft and report profit than having a large fleet of old aircraft and than reporting a loss year after year, as history proofs it,for example with MH.Then bail out and waste tax payers money.

 

MH 734's have very high cycles on them and are now ready for the dessert.Safety is another issue with aircraft of such age.HOwever good your maintainance is you cant run away from metal fatique due to high cycles.

 

We cannot compare what happens in the US as it is a country of totall different size and economics than mlaysia. Different time zones. and way larger population.

 

IMHO, a community airline should stay that way and "proppelers are backslogan?" and maintain that equiptment.Turboprops of todays generation are perfect for a country the size of malaysia.

Edited by jadivindra

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Can we have this topic being remove to the General Aviation subforum? Such a waste an interesting topic like this being put under this dead subforum.

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remember that MH has 20 option of 737-800 that might be destined for firefly , probably firefly first will used the old 737-400 for 2-3 yrs until the new planes come. but, i think MH need to make a new airline, new brand. not using firefly brand. firefly has gain its name for flying from subang, its their biggest advantages from airasia

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The best way to deter AK from charging ‘convenience’, what not fees and increase fare is to have competition. If FY can mount a constant challenge to AK is beneficial to travelers, more choice and cheaper fare :good:

 

Believe FY’s ATR should be based at KUL to serve secondary destinations as a feeder to MH. On the other hand, SZB is a more convenient airport for most people.

 

:drinks:

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My guess is this has nothing to do with the 734's being retired from MH, Subang or KLIA/LCCT operations, competing with Air Asia and what not

In fact, Dato Eddie Leong is probably so scared stiff of the emerging star of Malaysian aviation ...... Silverfly, that has necessitate this rethinking of Firefly's business model :p

See, if your upcoming competitor promises full lie-flat premium seats on Ipoh-KL, would you not be concerned ? :D

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The best way to deter AK from charging ‘convenience’, what not fees and increase fare is to have competition. If FY can mount a constant challenge to AK is beneficial to travelers, more choice and cheaper fare :good:

 

Believe FY’s ATR should be based at KUL to serve secondary destinations as a feeder to MH. On the other hand, SZB is a more convenient airport for most people.

 

:drinks:

there are only 20 mil people in malaysia. The thought that the more airlines are there the more cheaper the fares will become is just a myth. It doest work that way as there is a lot of cost involved in the running of aviation bussiness and prices can only go down to a certain level and hence by firefly launcing lots more domestic flights doesnt mean the prices will come down. On the other hand someone else might have to cut their flight frequsncy and then this might lead to higher prices as firefly can be quite expensive if booked on the spot compared with AA.

 

Firefly has got a good modern.vibrant image in a class of its own and this will be destroyed with a collection of sntique 734's.

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there are only 20 mil people in malaysia

nearer 26 mil actually

but not all can afford to fly

some can't even afford the bus fare to the weekly market :(

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My guess is this has nothing to do with the 734's being retired from MH, Subang or KLIA/LCCT operations, competing with Air Asia and what not

In fact, Dato Eddie Leong is probably so scared stiff of the emerging star of Malaysian aviation ...... Silverfly, that has necessitate this rethinking of Firefly's business model :p

See, if your upcoming competitor promises full lie-flat premium seats on Ipoh-KL, would you not be concerned ? :D

 

Once you manage to put your seat in in its lie flat position,then its time to put it back upright for landing! :p

Edited by jadivindra

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its not a stupid things,, why u keep sayin that,, firefly can both operate in subang and LCCT,, like BA and JAL operating in more than one airport in a same city,, the 737-400 just need some work on the cabin lighting,, leather seat,, and some sexy flight attendant,, and VOILA

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Always good to hear an airline expand, or at least plan to do so. Hope Firefly has some new destinations up their sleeves. :)

 

And re operating out of 2 bases so close to each other... Wouldn't Firefly need a bigger network for that? Otherwise I reckon it's more cost to the operation than the actual operational benefits you get out of it. Just my 2 cents though.

Edited by Tony

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Why do Firefly need 737s? Wouldn't adding another aircraft type to the fleet increase costs?

Thanks Suhaimi,that's exactly the point I am trying to make. Expanding is good but it must be in the right direction as the aviation sector is not merciful to wrong decisions.<_>

Edited by jadivindra

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Why do Firefly need 737s? Wouldn't adding another aircraft type to the fleet increase costs?

so what u expect firefly will expand with? another ATR plane?

MH need to compete with airasia, so they need boeing 737 to fly to longer routes like jakarta, bangkok, denpasar, kotakinabalu,,

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so what u expect firefly will expand with? another ATR plane?

MH need to compete with airasia, so they need boeing 737 to fly to longer routes like jakarta, bangkok, denpasar, kotakinabalu,,

Not unless if FY can get to operate 737s out of SZB - not likely to happen. If FY can operate scheduled pax jets out of SZB AK wants to move their base to there as well.

 

 

If FY does operate 737s from KUL, then it's cannibalization all over. Delta's Song comes to mind.

 

IMO FY should stick to SZB and their ATR72s and supplement to MH rather than try to make FY compete directly with AK and indirectly MH.

 

 

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so what u expect firefly will expand with? another ATR plane?

MH need to compete with airasia, so they need boeing 737 to fly to longer routes like jakarta, bangkok, denpasar, kotakinabalu,,

 

Flying ATR gives Firefly more advantages over Air Asia, especially from the small regional airports in Malaysia. I would be better for MH operate to the routes you mentioned rather than giving up to Firefly. I agree with others, Firefly should complement MH and not compete directly with AK.

Edited by Johan Z

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