MAS and AirAsia Shares Swap

[Cheng Long 0]

AK's LCC model cannot afford to have that kind of luxury. It tries to keep things as simple as possible to reduce costs, e.g. operating only 1 aircraft type throughout the whole network.

 

While it is possible to park your planes elsewhere, will its first morning flight be the normal 80% full flight or will it carry only 20 pax? What about the cost of having tech crews at the airport? AK does not have that many fully crewed hubs around the country.

 

AK and MH use different operating models and AK watches its costs carefully so that it does not bleed unnecessary. This is one of the measures that the new MH may need to adopt so as to reduce and stop the billion RM losses.

 

 

In a sense, Air Asia is just shifting the cost to someone else. In this case, it's MAHB. Air Asia doesn't want to have fully crewed hubs around the country to save cost, they park their planes in LCCT at night.

 

Parking space becomes an issue, so need to build a massive airport..Massive airport costs a bomb... But it shouldn't be a problem if both parties came to an understanding but TF turned around and shot MAHB, angry at the airport tax hike, their staffs start putting on protest stickers, passengers also encouraged to protest.. Initially also implying MAHB corrupt and excessive by building a 45m capacity airport before the dirty laundry got thrown back at him..All these to win some cheap publicity..

 

And yes, I also feel that the MH/AK share swap is kind of to protect Air Asia.. Competition gets too hot to handle..

[BC Tam 2]

2. Tony deferred aircraft deliveries NOT because there is no space (bull s#1t --> KLIA has a lot of apron space, especially around MTB/Satellite) BUT because HE cannot afford the bloody A320s.

 

Not true - AirAsia Group has recently accelerated the delivery of Airbus A320, MSN 4793, 4917, 4969 and 4979 that were earmarked for Yemenia:

 

I suspect it's somewhere in between - now that competition in guise of Firefly Jet has been snuffed out, AK group can thus afford to have those few extra 320's in

Probably helped to reduce a bit of the penalty charges due to Airbus resulting from deferred deliveries too

[flee 5]

Parking space becomes an issue, so need to build a massive airport..Massive airport costs a bomb... But it shouldn't be a problem if both parties came to an understanding but TF turned around and shot MAHB, angry at the airport tax hike, their staffs start putting on protest stickers, passengers also encouraged to protest.. Initially also implying MAHB corrupt and excessive by building a 45m capacity airport before the dirty laundry got thrown back at him..All these to win some cheap publicity..

For AirAsia, any kind of publicity is regarded as good publicity cos it is free publicity!

 

Anyway, LCCT is AKs headquarters - this is where the highest amount of flights come into and go out of. So it is only logical for most of the aircraft to be based.

 

I think that AirAsia is merely suggesting to MAHB that they should think about a 45m pax capacity airport now, in view of their past record of never completing any of the LCCT projects (bar the first one) on time. By the time the have finished thinking, awarding contracts and building it, the airport will just be ready for that volume of pax. However, MAHB turned this around to say that AirAsia asked for it and therefore they are doing it immediately.

 

Now that MAHB has decided to build a 45m pax airport for 2013, it will be far too big for present needs. So MAHB efficiency will be impacted. That is why they need to raise the airport tax and their charges NOW - so that they can have a fighting fund ready when the cash starts to drain out of the KLIA2.

 

And yes, I also feel that the MH/AK share swap is kind of to protect Air Asia.. Competition gets too hot to handle..

This is what the govt. calls "wasteful competition" - both MH and AK lose out, and it is bleediing MH very much more. If this is not stopped, MH will probably be no more by next year.

[Isaac 0]

yeah, there are other places to park too around the satellite terminal plus other airports. or is that too difficult? may have to do nightstop for some flights to PEN, BKI etc etc.

Five AK 320 sleep at BKI LCCT everyday.

[JuliusWong 0]

The last Firely flight out of KLIA is currently underway to Sandakan. By midnight once 9M-FFF returns, Firefly jet operation will be history.....What a sad day for Malaysia Aviation!!!

[jackch747 0]

The last Firely flight out of KLIA is currently underway to Sandakan. By midnight once 9M-FFF returns, Firefly jet operation will be history.....What a sad day for Malaysia Aviation!!!

 

Thanks to TF.

[Adrian M 0]

Five AK 320 sleep at BKI LCCT everyday.

In addition to what Isaac mentioned earlier,

 

3x A320 nightstop in KCH,

3x A320 nightstop in PEN,

1x A320 nightstop in SIN.

 

It seems tonight there is AFF, AFH, AFT, AHP, AQC, AQB, AQD, AQE sleeping in BKI T2.

Edited December 4, 2011 by Adrian M

[Izanee 0]

there you go, they CAN nightstop somewhere. what's the problem with parking a few more there? Firefly is now officially snuffed out, and I agree, Tony can breathe a sigh of relief. Get a few more planes in.

 

And for those that are so keen on a smaller KLIA2 - what will happen in a few years time when KLIA2's capacity is near enough 30 million? Another few years delay while they expand it to 45 million capacity? Why not do the whole thing now? 'Future proof' is the key word

[alberttky 0]

Khoo: Move to stop flights will hurt Sabah tourism

 

KOTA KINABALU: Malaysia Airlines' decision to stop direct flights between Sandakan and Kuala Lumpur will not augur well for Sabah's tourism and will lead to a monopoly of the route.

 

Assistant Minister in the Chief Minister's Department Datuk Edward Khoo said the decision by MAS, through its subsidiary Firefly, to stop the direct flights would hamper the state government's efforts to promote the east coast district as a tourism spot and an educational hub.

 

“This will also put a damper on our efforts to attract investors to the palm oil industrial cluster in Sandakan,” said Khoo, who is Sabah MCA chairman.

 

Speaking to reporters before leaving for Kuala Lumpur yesterday, Khoo alleged that the move smacked of a monopoly.

 

“MAS used to have daily return direct flights between Sandakan and Kuala Lumpur. When Firefly came in to service this route, MAS stopped.

 

“Lately, Firefly has stopped its flights and we are now left with only AirAsia serving the route,” he said.

 

“I still remember that when MAS and AirAsia had a share swap, it was announced that it would not create a monopoly for air travel.”

 

http://thestar.com.my/news/story.asp?file=/2011/12/5/nation/10033393&sec=nation

[flee 5]

The Sandakan people only got themselves to blame. When MAS flew the route, no one wants to fly them. So MH cut that route and gave it to FY. Assuming FY does well and AK cuts the route, they will oso blame AK for cutting it. But businesses cannot afford to make losses forever. So tough economic decisions are needed. What if MH now reinstates SDK and continues to bleed from it? Who will the Sandakan people blame again?

[alberttky 0]

The Sandakan people only got themselves to blame. When MAS flew the route, no one wants to fly them. So MH cut that route and gave it to FY. Assuming FY does well and AK cuts the route, they will oso blame AK for cutting it. But businesses cannot afford to make losses forever. So tough economic decisions are needed. What if MH now reinstates SDK and continues to bleed from it? Who will the Sandakan people blame again?

 

Sounds like a similar situation in Sarawak.

[Waiping 12]

I think the idea of night stop should be considered together with economic feasibility. It doesn't surprised me to see up to 6 aircraft are expected to night stop @ BKI because all these planes will depart between 6 - 8.30am(?) next day. From flightstats:-

 

AK5318 TPE 0610

AK5461 JHB 0640

AK6092 SDK 0700

AK5121 KUL 0705

AK6035 KCH 0800

AK6071 MYY 0835

 

Usually around 8.30am T2 is empty with no aircraft! I think plane operating AK6092 also operate another KUL flight upon return to BKI. So there are huge economic potential to place aircraft here for night stop. It may not be feasible to place aircraft at places whereby the return may not be justifiable.

[alberttky 0]

Sibu Airport extension to be operational on Dec 19

 

SIBU: The west wing of the extended Sibu Airport will become operational on Dec 19.

 

Deputy Transport Minister Datuk Abdul Rahim Bakri said the extension and improvement of the airport at a cost of RM136.8mil had been progressing well and ahead of schedule.

 

Rahim disclosed that the first package which consisted of extension works to the existing passenger terminal building, central utilities building and associated works was now 58.75% completed while the second package comprising works to improve airside and landside facilities and the Department of Civil Aviation’s building was 44.5% completed.

 

“The work is 2.25% ahead of schedule for package 1 and 2% ahead for package 2. We expect the whole project to be completed on September 19 next year,” he said at a press conference after being briefed by Sibu Airport officials.

 

Abdul Rahim stressed that once completed, the airport with four aero-bridges, 18 check-in counters, 14 immigration counters and two baggage handling systems would serve as a hub for air travel in the state’s central region.

 

“The new Sibu Airport would be able to handle up to 1.9mil passengers a year as compared to about one million now,” Rahmin said, adding that it would enhance the value of the airport and increased revenue for Malaysia Airport Berhad.

 

He said as the gateway to eco-tourism in the hinterland, Sibu Airport was well-positioned to receive tourists in chartered flights from Asean countries and even China and India.

 

“We expect more passengers and businesses when Asean member countries adopt an open sky policy in 2015,” said Rahim.

 

He said the Federal Government would not neglect air travel in Sarawak and Sabah.

 

“There is no need to worry about air connectivity in East Malaysia. MASwings will pick up where Firefly has left off. I assure you that passenger convenience and air services will not be disturbed,” he said.

 

He further said if there was any reduction of flights, the government would re-examine the situation.

 

Asked on the possibility of a weekly Sibu-Singapore direct flight, Rahim said it all depended on the demand.

 

He also advised passengers to plan their holidays in advance as it would make a lot of difference in the prices of tickets and accommodations.

 

“The way airline operates now is very different from the past. Ticket prices are determined by the time you purchase them.

 

“There is no more fixed price. If you buy early, it is much cheaper,” he explained.

 

He said although MAS fares were normally a little higher, it was worth it because MAS was a premium airline with good service and food.

 

http://thestar.com.my/news/story.asp?file=/2011/12/6/sarawak/10038183&sec=sarawak

------------------------------------------------------------------------------------------

“There is no need to worry about air connectivity in East Malaysia. MASwings will pick up where Firefly has left off. I assure you that passenger convenience and air services will not be disturbed,” he said.

So we can expect MASwings to ply KCH - KUL and KCH - JHB soon?

[CH Teo 0]

------------------------------------------------------------------------------------------

 

So we can expect MASwings to ply KCH - KUL and KCH - JHB soon?

 

Promise to be kept or not is another thing, let MASwings start the regional flights that had been talked for ages first...

[Nik H. 3]

Tomorrow will be an extremely interesting day for MAS, its employees, and all interested parties......

[Isaac 0]

In addition to what Isaac mentioned earlier,

 

3x A320 nightstop in KCH,

3x A320 nightstop in PEN,

1x A320 nightstop in SIN.

 

It seems tonight there is AFF, AFH, AFT, AHP, AQC, AQB, AQD, AQE sleeping in BKI T2.

Wow! 8!

[alberttky 0]

Tomorrow will be an extremely interesting day for MAS, its employees, and all interested parties......

 

Retrenchment exercise coming up?

[alberttky 0]

New MAS revamp plan

 

PETALING JAYA: Malaysia Airlines (MAS) has put together yet another business plan to turn itself around. It is learnt that the new management of the national carrier, which had undergone several revamps, has been working on the plan for the past two months.

 

“This time the focus is on growing the routes in Asia, improving on products, cutting unprofitable routes and forming alliances with more airlines,” said a source.

 

While cost-cutting measures are a given, another source said the question was, would the airline focus on the areas that should be trimmed and plug leakages? Or would it conduct only surface-level clean-up?

 

Earlier this month StarBiz reported that MAS might cut its routes to Dubai, Johannesburg, Buenos Aires and Cape Town in a bid to reduce costs.

 

However, that would require the Government's approval and whether MAS has managed to secure the nod is not known.

 

MAS might also do away with its hub in Kota Kinabalu and cut flights out of the city to destinations such as Haneda, Seoul and Osaka (in Japan). It might also drop the Langkawi-Singapore route.

 

Sources said the airline might spin off some of its subsidiaries like the ground handling and cargo operations into separate units for better accountability.

 

MAS CEO Ahmad Jauhari Yahya and his deputy Mohd Rashdan Mohd Yusof met senior executives of the airline yesterday to brief them on the new plan.

 

They will invite MAS employees to a townhall meeting today after which they will meet the media to disclose the plan and how they intend to turn around the airline, which reported RM1.2bil in net losses for the first nine months of the year.

 

This plan has come about after MAS entered into a share swap with AirAsia Bhd's founding members in August. It had also led to a board revamp and a change at top MAS management. The share swap has also ended the rivalry between MAS and AirAsia, and along with it Firefly's operations which had been a threat to AirAsia.

 

Ahmad was appointed in September and was tasked to come up with a plan to save the national carrier.

 

Whether he would share how AirAsia and its sister airline, AirAsia X, would fit into MAS' business plan is unclear but sources are speculating MAS might axe some of the routes that overlap with those of AirAsia and AirAsia X.

 

AirAsia X has been hoping to secure the KL-Sydney route and it remains to be seen if that issue would be addressed today since MAS has blocked AirAsia X request to obtain the route for nearly two years.

 

Ahmad has re-organised the airline to have the narrow body and wide-body operations separated so that each can tap into its respective market.

 

He has also come up with a new organisational chart which maintained most of the existing senior management team. However, some of them have resigned and others are contemplating quitting.

 

To save costs, Ahmad has also suggested that the MAS administrative offices be moved to the KL International Airport from Subang,

 

While MAS would continue to ensure that it benefited from its entry into the Oneworld alliance, it is unclear if he would comment on the airline's relationship with Qantas. The Australian carrier has yet to decide between Kuala Lumpur and Singapore for its Asian hub.

 

“The talks with Qantas are still very preliminary and if anything, we may have to wait until January or February to know if Qantas would ride on MAS' short-haul operations to offer linkages within Asia,” said a source.

 

http://biz.thestar.com.my/news/story.asp?file=/2011/12/7/business/10047926&sec=business

[KK Lee 5]

Please read with a pinch of salt;

 

"The past mistake of Khazanah identified, trained and nurtured former CEO Tengku Azmil was an accountant trying to be a Commercial Director. To make situation worse, Azmil couldn't handle his two Assistant Commercial Directors throwing chairs at each other in meetings."

 

"The plan is to turn MAS private by buying out minority s/holder and get delisted. Engineering and cargo will be sold off. This implies that they will have the freedom to do as they please without public scrutiny.

 

Their excuse is we need to sell the two profit making SBU to raise money for the airline biz to operate. By default, MAS will turn into a PN4 company and immediately delisted.

 

That's the view of few Top 100 senior management personnel present at 630 pm today. At 9am tomorrow (7th December), there will be a town hall session with rest of staff before they make the presentation to Ministry of Transport.

 

Is the AA fight agst MAHB a diversion from MAS AA share swap problem? Is that why Amokh is so silent and TF allowed to bark?"

 

http://anotherbrickinwall.blogspot.com/2011/12/confirmed-incompetent-and-idealess.html

[zamim 0]

Nothing new. We have heard it before. AJ and Danny talked about RASK and CASK, sound familiar. In fact both of them were whacked by Unions n Assocs reps at the first session and then they had to excuse themselves to meet the other staff. Q n A for staff lasted only for 20 mins. Off again to meet MOT

You had seen it before. MAS is xxxxxxx

[flee 5]

MAS says ‘back to black’ by 2013

 

PETALING JAYA, Dec 7 — Loss-making Malaysia Airlines (MAS) unveiled today a two-pronged strategy in its highly-anticipated turnaround plan, pledging to return the ailing flag carrier "back to black" by 2013

 

Its new business plan, which market analysts had earlier said appeared to be overly “simplistic”, lists five fundamental recovery initiatives to stem the carrier’s losses, restructure the business organisation and regain the airline’s position as a commercially successful flag carrier.

 

The initiatives include: smaller, yet profitable network; win back customers; relentless cost focus; keep it simple (spin-off ancillary businesses) and; bridge the funding gap.

 

Speaking to the media and analysts at the unveiling of the plan today, MAS group chief executive officer Ahmad Jauhari Yahya said the current market environment remains challenging for the airline due to increased competition from low-cost and full-service carriers, overcapacity in the Asian aviation sector, high fuel cost and the global economy.

 

“Our plan now is to set the course.. we are very deep in crisis. Our cumulative losses until the third quarter amounts to RM1.247 billion.

 

“And we do not see any improvement, in fact, in the fourth quarter... it looks even lower than last year,” he said.

 

Source

[flee 5]

MAS to launch new premium airline next year

 

PETALING JAYA, Dec 7 — Malaysia Airlines (MAS) confirmed today it will launch a new regional premium airline by mid-2012 as part of its turnaround plan to ensure the ailing flag carrier’s long-term sustainability.

 

MAS group chief executive officer Ahmad Jauhari Yahya said the airline will connect Asean destinations and key cities in South Asia, as well as greater China, using a fleet of Boeing 737-800.

 

The airline, he added, would also serve as a point-to-point commuter for regional and domestic travel, as well as a feeder service to MAS’s long-haul airline.

 

“We intend to create a separate management structure to focus on the unique customer needs of regional premium travellers,” he said here.

 

Ahmad Jauhari was speaking during the launch of MAS’s highly-anticipated business turnaround plan, which promises to see the loss-making carrier “return to the black” by 2013.

 

Source

[flee 5]

MAS unveils plan to bring airline back to profit by 2013

 

Loss-making Malaysia Airlines (MAS) unveiled a business plan on 7 December to bring the group back to the black by 2013.

 

The plan includes a slew of harsh measures including suspending loss-making routes, focusing on cost cutting and aggressive marketing to win back customers. These moves are expected to bring in revenue of up to ringgit (M$) 1.508 billion for the group.

 

The group also announced that it will be launching a premium regional carrier in the first half of 2012 which will, in the long term, fly all the domestic and regional routes serviced by MAS now.

 

At a press conference on 7 December, the airline said it has reported a cumulative loss of M$1.247 billion for the first three quarters of 2011 and that it does not expect to make a profit for the full year.

 

It added that should the group maintain its current business model, the airline will go bankrupt by the middle of 2012.

 

"Malaysia Airlines needs to make hard and unpopular decisions simply to survive in order for it to have the possibility to thrive and realise the airline's vision," said group CEO Ahmad Jauhari Yahya.

 

"The market environment remains very challenging for Malaysia Airlines, given the increased competition from low-cost and full-service carriers, overcapacity in the Asian aviation sector, high fuel cost and the volatile global economy," he added.

 

Ahmad Jauhari also admitted that the airline has lost focus on its full-service offering, resulting in a drop in quality standards, passenger load and lower pricing compared with other airlines in the region.

 

The airline's average fleet age of 13 years also did not help business, he said.

 

To improve the profitability of its network, the airline will suspend loss-making services to and from Cape Town, Johannesburg and Buenos Aires, among others.

 

"Successful turnarounds of other airlines such as JAL or Garuda have been based on agressive network cuts. The cutting of MAS's available seat kilometres by approximately 12% next year is expected to save between M$220 million [and] M$302 million," said Ahmad Jauhari.

 

MAS will be deploying 23 new aircraft in 2012 and will improve its revenue management and tactical sales to optimise yields and bring in profits of up to M$477 million while winning back customers.

 

The carrer also aims to bring about savings of up to M$392 million by reducing fixed costs and improving procurement and productivity.

 

Besides all these cost-cutting measures, the airline will also now focus on its core business and spin off its anciliary businesses in aerospace engineering, pilot training, cargo and ground handling. This is expected to bring in a profit of up to M$337 million for the airline.

 

The carrier, which will become a full member of the Oneworld alliance by the second half of 2012, also plans to leverage on alliances and partnerships with member airlines to expand its network.

 

"We are also exploring the possibility of joint ventures with partners in order to serve multiple markets together, while reducing the financial risks of going [it] alone," said Ahmad Jauhari.

 

MAS added that it has also started discussions with AirAsia and AirAsia X, as part of its collaboration, to improve efficiency through joint procurement and consolidation of key activities.

 

Source

[Isaac 0]

win back customers;

One of the first things they should do is to do away the cheap looking snack-box.

[alberttky 0]

One of the first things they should do is to do away the cheap looking snack-box.

 

Absolutely agree!