MAS Restructuring Plan

[Pieter C. 5]

I think he meant that it worked for some airlines but not others.

 

Exactly, Keith

 

I agree with Pieter, creating an LCC will not necessarily work. Swiss tried it unsuccessfully for their European operations in the aftermath of the Swissair bankruptcy. One of the main principles of a succesful LCC is quick turn around times.

 

Not only for LCC but also mainline carriers; When I first started to work for KLM in the early 70's, they had 3 waves a day: this coming Summer schedule, they will go from a 6- to a 7-waves system, guaranteeing passengers a better spread of connections throughout the day, basically starting flights ex AMS between 6am and 10pm...

 

[Seth K 3]

With MH situation right now, losing money to AK and so on...............LCC will fit perfectly for the ill-company, look at all Malaysian, all prefer cheap(OK may be not all, most) stuff. So, with MH creates a LCC, there is a 50/50 chance market for them on unpopular routes, instead of losing 100+ routes to AK right now

 

Look, 74% Malaysian household make under RM3000-from Malaysian eigth plan, basically very low, and trust me everyone would love to fly in an airplane, it's a pride or something like that. Now their option to fly is AK, but with MH LCC, they may think twice before they choose one. So, MAS needs strategy to make people think twice before flying and get them on their plane.

[S V Choong 4]

Look, 74% Malaysian household make under RM3000-from Malaysian eigth plan, basically very low, and trust me everyone would love to fly in an airplane, it's a pride or something like that. Now their option to fly is AK, but with MH LCC, they may think twice before they choose one. So, MAS needs strategy to make people think twice before flying and get them on their plane.

 

Consider this case. Average Income of New Zealander is about USD about $18,000 per year. Yet two LCCs are competing against each other - Qantas and Air NZ both domestically. No matter how rich a country is, there is a fair bit of market for cheap fare. After all it is just about getting from point A to B.

 

Some of you tend to think that it is unreasonable for MAS to adapt a different business method, remember well, only the fitess survives.

[Sandeep G 1]

MAS... is in a big hole... that they've dug themselves...

 

The solutions are very simple.. someone in the Government or in MAS, needs to bring their head down from out of the clouds, grow some balls, sacrifice their ego and pride and admit to the discrepancies facing the airline, and at the same time talk SOME sensible restructuring ideas.. Then MAS can attract investment, grow and recover from the mess it is in.. Until then, we can only talk about transparency and accountability.. The time has come for MAS to take the necesesary steps or I fear we will be stuck with a lemon airline for life..

 

MAS can compete and SHOULD compete with AirAsia... healthy competition also has the potential to increase yields.. but more importantly, it enforces strict corporate governance and practices within either organisation ensuring that such a mess will not reccur...

 

To the governments decision to not BAIL OUT MAS, I think the indication to the market is that the govt does not trust MAS with that sum of money... because otherwise, a bailout is exactly what MAS needs at this point in time..

 

Once again, hire a few of us over here at Malaysianwings.com MAS, we'll do the job under-budget, with passion and make sure we make a killing for the airline.... it's in our blood!

[Walter Sim 1]

MAS... is in a big hole... that they've dug themselves...

 

The solutions are very simple.. someone in the Government or in MAS, needs to bring their head down from out of the clouds, grow some balls, sacrifice their ego and pride and admit to the discrepancies facing the airline, and at the same time talk SOME sensible restructuring ideas.. Then MAS can attract investment, grow and recover from the mess it is in.. Until then, we can only talk about transparency and accountability.. The time has come for MAS to take the necesesary steps or I fear we will be stuck with a lemon airline for life..

 

MAS can compete and SHOULD compete with AirAsia... healthy competition also has the potential to increase yields.. but more importantly, it enforces strict corporate governance and practices within either organisation ensuring that such a mess will not reccur...

 

To the governments decision to not BAIL OUT MAS, I think the indication to the market is that the govt does not trust MAS with that sum of money... because otherwise, a bailout is exactly what MAS needs at this point in time..

 

Once again, hire a few of us over here at Malaysianwings.com MAS, we'll do the job under-budget, with passion and make sure we make a killing for the airline.... it's in our blood!

 

I love this statement Sandeep!

 

Bundled with UNLIMITED RAMP PASSES =D

 

Woahh~~

[Azman MN 1]

With MH situation right now, losing money to AK and so on...............LCC will fit perfectly for the ill-company, look at all Malaysian, all prefer cheap(OK may be not all, most) stuff. So, with MH creates a LCC, there is a 50/50 chance market for them on unpopular routes, instead of losing 100+ routes to AK right now

 

Look, 74% Malaysian household make under RM3000-from Malaysian eigth plan, basically very low, and trust me everyone would love to fly in an airplane, it's a pride or something like that. Now their option to fly is AK, but with MH LCC, they may think twice before they choose one. So, MAS needs strategy to make people think twice before flying and get them on their plane.

 

I agree that turning MAS into LCC can increase its $$ turnover, but the problem I see in MAS is not creating turnover, but to reduce cost. The point I was trying to make in my previous post is that you cannot just decide, ok, lets sell cheaper tickets to attract the masses and stop serving food to cut cost and voila, we have an LCC!

How can MAS be Low Cost when its management are expensive, not to mention all its con-sultans? To turn into LCC it has to reconfigure its 737s to have more seats, that's gonna cost a lot! Not only change seats, it may also want to remove the seat recline function like AK (this idea came from Ryanair I think - no recline mechanism = cheaper seats & lighter seats = less fuel burn...). There are many things that MAS has to change, but I think to be an LCC, MAS really needs to be low cost in every area of its operations. In other words, I think that whatever it is that is stopping MAS from cutting its costs now will continue to stop it from cutting costs whether it is a full frills or LCC.

[Bing Chu 0]

I reckon Azman has more or less hit the bull's eye there.

 

Another point, it's basic human instict to resist change. More so when the intended change is likely to deprive you of the long entrenched gravy train that has provided one with quite a comfortable living thus far. And so the story continues, not only for MH but all other GLC's as well

 

 

[S V Choong 4]

I agree that turning MAS into LCC can increase its $$ turnover, but the problem I see in MAS is not creating turnover, but to reduce cost. The point I was trying to make in my previous post is that you cannot just decide, ok, lets sell cheaper tickets to attract the masses and stop serving food to cut cost and voila, we have an LCC!

How can MAS be Low Cost when its management are expensive, not to mention all its con-sultans? To turn into LCC it has to reconfigure its 737s to have more seats, that's gonna cost a lot! Not only change seats, it may also want to remove the seat recline function like AK (this idea came from Ryanair I think - no recline mechanism = cheaper seats & lighter seats = less fuel burn...). There are many things that MAS has to change, but I think to be an LCC, MAS really needs to be low cost in every area of its operations. In other words, I think that whatever it is that is stopping MAS from cutting its costs now will continue to stop it from cutting costs whether it is a full frills or LCC.

 

Good one Azman, realising the fact that MAS will have to spend more money in recogfiguring seats, that is why I suggested that MAS should keep the current seats and keep a section for those who is willing pay for the extra bit. I can't see AK's seat that different from MAS' B734.

 

More so when the intended change is likely to deprive you of the long entrenched gravy train that has provided one with quite a comfortable living thus far.

 

That is the real problem here...... but MAS may not be able to free herself from being someone's gravy train. If you are on the gravy train, milk it until it exhausted

 

Just wondering if SQ (with the same structure) is free from government intervention?

 

[Seth K 3]

Good one Azman, realising the fact that MAS will have to spend more money in recogfiguring seats, that is why I suggested that MAS should keep the current seats and keep a section for those who is willing pay for the extra bit. I can't see AK's seat that different from MAS' B734.

That is the real problem here...... but MAS may not be able to free herself from being someone's gravy train. If you are on the gravy train, milk it until it exhausted

 

Yeah I think idea of MAS LCC is not good enough after you guys point out some points here, yeah stick with current progress

 

 

Just a lil óf topic here

 

The four were Mohammed Faiz Kamaluddin, 34, a pilot with Malaysian Airlines

 

Anybody know this guy, very lucky...........................................

[Seth K 3]

Some good news......MH predicts 10% growth in Charter service

MAS Expects 10 Pct Annual Growth In Revenue From Charter Services

 

More money coming in for MH plus cargo growth

[Seth K 3]

Malaysian Airline System Bhd (MAS) has teamed up with Octopustravel.com in an online travel agency partnership aimed at reinforcing its capabilities in online direct sales.

 

MAS's commercial director Datuk Rashid Khan said the collaboration was part of the national carrier's business turnaround plan.

[Azman MN 1]

The four were Mohammed Faiz Kamaluddin, 34, a pilot with Malaysian Airlines

 

Anybody know this guy, very lucky...........................................

 

Errr... I'm a little lost here. What is this refering to? I think I know this guy...

 

 

[Denny Yen 0]

Errr... I'm a little lost here. What is this refering to? I think I know this guy...

 

He is 1 of the 4 shortlisted candidates for the "1st Malaysian in Space" program. Name rings a bell...I think he is the Md Faiz of SJI Form 5 class of 1988 or 1989. There are several ex-Johannians in MAS, guy named Amirul, Poh Meng, 2 from 1988 batch, etc.

 

http://thestar.com.my/news/story.asp?file=...9245&sec=nation

[Azman MN 1]

Thanks Denny,

 

So Yes I know him - my classmate from std. 1 till std. 6 but in secondary school he was not in the same class. So definitely Form 5 1989 batch. He was Mr. Cool already in primary school. Would never have imagined him to be an Astronaut

 

He became a pilot together with another classmate - Idi Nasran. Both were FO on 777s in the early days at MAS. I think someone mentioned here that Idi is 737 Capt. now.

 

 

[Radzi 2]

Capt M Faiz is still on the 737 fleet. capt Idi is also on the 737 fleet; he is the B737 Chief Pilot - Tech and Development. Or something like that.

 

And of course, I hope Capt Faiz will be The Malaysian Astronaut. Better root for your own friend, of course.

[Denny Yen 0]

Would never have imagined him to be an Astronaut

Yeah, same here...I would have thought Anandan 5Sc1 or Tariq 5Sc2 (if both slim down) could make it.

 

FYI, do you know Tengku Azril (or Azrel)? Also 1989 batch, I heard he's a MAS pilot too?

[kandiah k 0]

March 16, 2006 19:02 PM

 

MAS To Handle Domestic Trunk Routes And AirAsia Low Cost Flights

 

 

KUALA LUMPUR, March 16 (Bernama) -- The government has decided that Malaysia Airlines (MAS) will handle the domestic trunk services and AirAsia the low cost flights.

 

In efforts to rationalise the domestic flight sector, the government also decided that AirAsia will handle domestic non-trunk services, a statement issued by the Prime Minister's Office today said.

 

According to the statement, MAS and AirAsia are also given the flexibility to determine the flight frequencies, capacity distribution, type of aircraft and fares subject to the supervision of the Transport Ministry.

 

As such, the Transport Ministry would upgrade its supervision capability mechanism to ensure healthy competition in the domestic flights sector.

 

The statement further said the government was of the view that the rationalisation process of the domestic flights sector was needed to ensure the long-term success of MAS and AirAsia.-- MORE

 

[Keith T 2]

March 16, 2006 19:02 PM

 

MAS To Handle Domestic Trunk Routes And AirAsia Low Cost Flights

KUALA LUMPUR, March 16 (Bernama) -- The government has decided that Malaysia Airlines (MAS) will handle the domestic trunk services and AirAsia the low cost flights.

 

In efforts to rationalise the domestic flight sector, the government also decided that AirAsia will handle domestic non-trunk services, a statement issued by the Prime Minister's Office today said.

 

According to the statement, MAS and AirAsia are also given the flexibility to determine the flight frequencies, capacity distribution, type of aircraft and fares subject to the supervision of the Transport Ministry.

 

As such, the Transport Ministry would upgrade its supervision capability mechanism to ensure healthy competition in the domestic flights sector.

 

The statement further said the government was of the view that the rationalisation process of the domestic flights sector was needed to ensure the long-term success of MAS and AirAsia.-- MORE

 

 

Sounds a bit like the 'Dual airline service charter' during the days of the cozy AN/QF duopoly for Aussie domestic flights. However that charter was to ensure that no area of Australia misses out on air services, not a "mechanism to ensure healthy competition." I wonder to what extent can competition be regulated though, and isn't substantial deregulation domestically the key to healthy competition, as opposed to an "upgrade" in the Transport Ministry's supervision apparatus?

[Azman MN 1]

Yeah, same here...I would have thought Anandan 5Sc1 or Tariq 5Sc2 (if both slim down) could make it.

 

FYI, do you know Tengku Azril (or Azrel)? Also 1989 batch, I heard he's a MAS pilot too?

 

Hehe, last saw Eddie (Anandan) at his b'day party about 3 years ago- he was a lawyer at Astro then (he does move around a lot) and I bumped o Tariq in KL 2 weeks ago - still working for mum I assume, which is not a bad thing at all in his case.

 

Idi always wanted to be a pilot. With Faiz I was surprised. But he was always charming and not hard to see how he can be successful.

 

I don't recall a Tengku Azrel. One of our seniors, my brother's batch, is Tengku Azmel. Not pilot, but board member... (not too sure if he went to SJI or not though, but definitely primary school)

 

Which brings us back to the topic - what does "trunk" route actually mean? Sounds like another word for "juicy routes with lots of passengers". So MAS gets the juicy route and AK the rest and fingers crossed both will succeed?

[Isaac 0]

Exactly, Keith

Opps ...... Sorry. My bad

 

[Seth K 3]

From the Star

MAS forges alliance with Air France KLM

 

SEPANG: Malaysia Airlines (MAS) has received Air France KLM's nod to upgrade their code-sharing agreement into an alliance, MAS managing director Idris Jala said.

 

However, he said no timeframe had been set for the alliance.

 

“We are also working towards improving bilateral code-sharing agreements and joining alliances with other airlines,” Jala said after the launch of the upgraded Animal Hotel at the KL International Airport yesterday.

 

Jala is believed to have met top executives of Air France KLM earlier this month to seek support for the national carrier's entry into the SkyTeam group, one of the three main global air alliances, which has a network of 684 destinations in 133 countries. MAS, which posted a net loss of RM1.26bil for the nine months to Dec 31, 2005, is the only regional airline that has yet to enter any global alliance.

 

On AirAsia's plan to acquire some MAS assets, including a number of aircraft, Jala said MAS would have a free hand to fully decide on its business operations, the network, the routes and even the restructuring of its domestic operations, once the MAS-AirAsia route restructuring is completed next year. .............

 

Looks like MH step one foot forward

[KK Lee 5]

 

At current load and fuel price, it is estimated on KUL/EWR sector, MH is losing about RM1 millions per round trip, RM3 millions per week or RM150 millions per year.

 

MH should route EWR via AMS and codeshare with KLM.

 

Without drastic changes, doubt Idris can turn around MH.

 

 

[Ruiz Razy 1]

At current load and fuel price, it is estimated on KUL/EWR sector, MH is losing about RM1 millions per round trip, RM3 millions per week or RM150 millions per year.

 

MH should route EWR via AMS and codeshare with KLM.

 

Without drastic changes, doubt Idris can turn around MH.

 

Could do, or go back to the KUL - DXB - EWR on daily basis as demand for DXB - EWR is high particularly for premium pax., despite the uneasy relations between the Arabs and Americans. The high demand can be seen on EK's DXB - JFK's double daily flights. After all, I'm sure MH can compete well as it is "just" EK in that market ( and EK is rated 4 star) and maybe have code share arrangements with CO/NW/DL. I've also heard that the fare from DXB to JFK/EWR is higher than KUL/SIN to JFK/EWR as there has not been enough flights. If it is true, I'm sure it will help MH in terms of YIELDS ( the basic principle to make money).

 

The 3 flights in a week does not look attractive for premium pax. / business travellers. If they want to fly to a destination, a daily flight should be the the minimal amount of flights.

 

What worries me most is that SQ, EK, CX and to certain extent TG are set to gain with MH drastic downsizing.

[Kee Hooi Yen 0]

Could do, or go back to the KUL - DXB - EWR on daily basis as demand for DXB - EWR is high particularly What worries me most is that SQ, EK, CX and to certain extent TG are set to gain with MH drastic downsizing.

 

I agree with you. Perhaps it is difficult for MAS to catch up with these airlines to the same league after the downsizing.

[KK Lee 5]

 

Apart from frequency, MH evening arrival to EWR is unhelpful to connecting pax.

 

MH may be a 5 star airline with the best cabin service but very often don’t give what pax really want. Hence, EK is operating 2 daily flights on DXB/EWR while MH never made money on KUL/DXB/EWR route.