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Mohd Suhaimi Fariz

MAS Privatisation

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Air Malaysia, Malaysian Airways? Don't really fancy having 'Royal' in it... In any case there's no escaping using the name Malaysia. People will always remember Malaysia as something to do with the crashes of the century. 540 lives, that's comparable to the Tenerife collision.

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I agree, even though I like the name "Royal Malaysian Airways", there's nothing royal about MH anymore. I know a lot of people call MH, MAS and never Malaysia Airlines or MH.

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I think MAS should use the blue livery that they use of the A380.

That livery on the A380-800 is so blue though. I mean it is not the bright type of blue, it's the type of blue that makes people feel blue. And currently people are already feeling very blue about MAS.

Edited by Isaac

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Investors aren't pleased though.

 

Can't please everyone... . The staff have been through a lot - and i feel very sorry for them. Hope the money helps a bit.

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ANALYSIS: How will MAS survive its latest crisis?

 

It was Winston Churchill who said that one should never let a good crisis go to waste, but for Malaysia Airlines (MAS), dealing with two crises in one year will prove extremely challenging.
Prior to the MH17 tragedy, MAS was already reeling financially from the impact of MH370's disappearance on 8 March, with little light at the end of the tunnel. Although MH370 went missing towards the end of the quarter, the airline said it had a "dramatic impact" on its financials, resulting in a MYR439 million ($138 million) operating loss for its first quarter.
Following a briefing with MAS management in May, Alliance Research said in a research note that MAS's yields and load factors were likely to deteriorate following the MH370 incident, with the "negative impact potentially manifesting in 2Q and 3Q results".
At this stage, the impact of the MH17 disaster has been hard to judge. In a briefing note issued on 18 July, TA Securities said MH17 will have only a "moderate" impact on MAS, but maintained its sell rating on the company's stock.
"The MH17 incident would damage the MAS brand less than MH370 because MAS was not negligent in routing its flights over eastern Ukraine – a number of other airlines continued to do so right until the MH17 incident," says Dr Terence Fan, an assistant professor of strategic management at Singapore Management University.
The timing of the second disaster comes as MAS's 69.4% shareholder – state investment firm Khazanah Nasional – is looking at options to try and turn the struggling carrier around. To do so now appears imperative.
"After these two incidents, MAS could definitely use a 'reboot' of sorts, both in the eyes of customers as well as of their own staff," says Fan.

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Malaysian Airways was previously used during the period from 1963 to around 1965 when Singapore was a part of Malaysia.

 

KC Sim

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I personally think re-branding is not an option ... it is a necessity. The negative publicity across the world following the loss of MH370 and MH17 have left the wau logo and airline name in tatters. It is a brand that is damaged beyond salvation.

 

But re-branding will do little if it is not PRECEDED by :

 

- a major re-structuring of the airline's management and operation. Malaysia should look at all the talents that is available within the country to place in top positions ... not constrained by creed or religion.

- a major down-sizing of its fleet, staff strength and network. If I were to make a call, the A380 should be the first to leave ... sound out Garuda and Turkish Airlines. However cheap labour cost is said to be, its bloated staff strength will continue to drain the airline day in and day out, relentlessly and mercilessly. And the airline has to really re-appraise its network and reduce what is not profitable or valuable for feeding into its KUL hub.

- replace its fuel-guzzling long-haul fleet with something more fuel-efficient. If indeed the A380s go, B77Ws would be a good option along with A330NEOs. Forget about Dreamliners and A350s for now but when the outlook improves, it must consider these in a timely manner.

- political meddling must stop and the airline should not be treated as the personal limousine for powerful cronnies.

 

Only after all the necessary re-structuring is in place should the re-branding take place ... but thoughts must now begin on all the options available in naming the airline. I kind of like Francis Lee's proposal of Royal Malaysian Airways ... perhaps even just calling it "Royal Malaysian" is enough. The wau should best be left on the shelf ... and a new symbol identified that projects a soft cultural image. Perhaps a turtle, the hibiscus, a batik print, a tapir, a Malayan tiger ... I am certain members of Malaysianwings can come up with an exhaustive list of potentially useful symbols. This is a time for Mwingers to brainstorm and find a way to share its final thoughts with the airline through whatever channel is available.

 

Like all of you, I am saddened by what happened and like you, I too hope that MAS could turn its fortune around and transform itself and rise like a phoenix.

 

KC Sim

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To be honest, I think MAS should suspend its operations for a while in order to restructure. Then they won't have to deal with day to day problems like missing airplanes or planes downed by SAMs.

 

In MASwings, MAS Kargo, MAS Engineering, and Firefly, they have the basis for a new airline group.

 

MASwings should be allowed to operate in Borneo with high frequency ATR services so that it can connect the major hubs KCH/BKI to the rest of Sabah and Sarawak as well as Kalimantan and southern Philippines.

 

Firefly should continue in its present role linking up the Peninsula as well as with southern Thailand, Sumatra and Singapore. They should also adopt a high frequency model.

 

MAS itself should be restructured to provide point to point regional services direct to its most popular international points of entry, KUL, BKI, and PEN. In addition, it should provide the trunk links to KCH and BKI. This should be a B737-8 Max/A320neo operation for most routes and they should have the A321neo for longer range operations.

 

A longer term objective of this regional unit is to develop more hubs for international routes - JHB, KBR, KCH and perhaps LGK.

 

Long haul operations might be better off as a separate company. Those flights that are over 6 hours should be considered long haul. MH should probably start with two long haul hubs, e.g. KUL on the peninsula and BKI in East Malaysia.

 

MAS Engineering should be further developed to provide MRO not just for the group but also more capacity to serve other airlines. With more work from third parties, economies of scale will kick in, MAS will also benefit from lower costs.

 

Finally, like MAS Engineering (for MRO activities), they should set up something for operations too - MASOps should be responsible for the operations of the whole group's services. That way, good co-ordination and cost efficiency from operations can be achieved.

 

With the airlines broken up into their own segments, each can focus on their own marketing and sales. MASOps can focus on operating its assets most efficiently. MAS Engineering should provide economic MRO services.

 

But alas... I am dreaming! ;)

Edited by flee

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If there is a silver lining for brand Malaysia Airlines, this region is full of airlines that have bounced back from major air disasters and are still around today. Korean Air, Singapore Airlines, Silk Air, China Airlines, etc. Just to name a few.

 

It will be long and painful, even more so in MAS' case having to deal with back-to-back one-of-a-kind disasters. But it can be done. After all, in this day and age, what's the point of creating a new brand when everyone knows it's the same sheep with different skin.

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Believe insurance has paid for both hull losses, should lessen the bottom line losses.

Don't think that the article was referring to the direct hull losses. It was assessing the impact to the business as a whole.

 

Cynically, we should be happy that MAS is getting insurance payouts for the aircraft it intends to retire soon - so the cost of retiring the aircraft is now paid for!

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Don't think that the article was referring to the direct hull losses. It was assessing the impact to the business as a whole.

 

Cynically, we should be happy that MAS is getting insurance payouts for the aircraft it intends to retire soon - so the cost of retiring the aircraft is now paid for!

 

I thought it's rather sensitive to say this, isn't it?

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Don't think that the article was referring to the direct hull losses. It was assessing the impact to the business as a whole.

 

Cynically, we should be happy that MAS is getting insurance payouts for the aircraft it intends to retire soon - so the cost of retiring the aircraft is now paid for!

 

The Atrium Underwriting Group, the lead underwriter for Malaysia Airlines’ war risk insurance, said in a statement that it had immediately approved payment for the loss of the aircraft in Flight 17. Aon, a London-based company that is one of the world’s largest insurance brokers, said over the weekend that the plane had been insured for $97.3 million, but Atrium did not confirm the value.
The crash of Flight 370 triggered a half-payment from Atrium under the war risk policy after adjusters concluded that there was a substantial but not ironclad case that the crash may have involved pilot suicide or other criminal action. War risk policies also cover deliberate, malicious acts.
The Allianz-led policy — Allianz itself has only 9 percent of the exposure, having shared the rest with other underwriters — paid the balance of the cost of that aircraft, which had been insured for $100.2 million, insurance executives said.
....
The crashes of Flight 370 and Flight 17 are not Malaysia Airlines’ first unusual insurance claims, however. The airline had an unusual claim in 2000 for the total loss of an Airbus A330 traveling in the opposite direction on the same route as Flight 370.
In that case, a canister of a mysterious Chinese shipment destined for Iran broke open near the end of a trip from Beijing to Kuala Lumpur and began leaking, producing a smell that prompted the captain to conduct an emergency evacuation upon landing of all 266 people aboard. A subsequent investigation found that the hold was contaminated beyond cleaning with mercury and other chemicals that may have been precursors for the manufacture of nerve gas.
The Malaysian government ended up digging a large hole in the ground near the airport tarmac and burying the entire plane. Insurers paid a full settlement of $90 million.
With MH370, the lead company for hull insurance is Germany’s Allianz. War-risk and terrorism insurance for the plane is covered by Lloyd’s. Allianz is also the lead insurer for liability. “I can tell you without a doubt,” says one attorney familiar with the finances of the case, “when it comes to hull insurance on this incident, the lienholders and the lessors have already been paid in full.”
How much? The plane had been written down from its list price of $261 million to about $100 million. But it was likely insured for full replacement value. (“I know of no airline that does not insure its aircraft for full replacement value,” says Peter Schmitz, CEO of global aviation for Aon.)

http://fortune.com/2014/05/01/the-big-money-surprise-about-malaysia-airlines-flight-370/

Edited by KK Lee

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The Malaysian government ended up digging a large hole in the ground near the airport tarmac and burying the entire plane. Insurers paid a full settlement of $90 million.

 

 

What a revelation. I didn't know MKB was buried in KLIA.

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What a revelation. I didn't know MKB was buried in KLIA.

 

That is interesting indeed!!! Wow.. Buried opposite the Satellite building perhaps ? :) sounds like a big big job!

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That is interesting indeed!!! Wow.. Buried opposite the Satellite building perhaps ? :) sounds like a big big job!

After removing wings, engines, uncontaminated section of fuselage, they could chop up to bury, so shouldn't need a big hole.

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MKB was dismantled in front of the hangar at KLIA. Not sure what happened to the parts; but surely they didn't bury the whole aircraft there. Nor did I remember them digging any big hole nearby.

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Whether it's the whole bird, the contaminated bits or just the contaminant, that method of disposal sounds very crude for something deemed toxic enough to warrant writing off a very expensive piece of equipment :)

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Instead of spending money to dig hole and contaminate the ground, it won't be a surprise those alunimum was sold to scalp metals dealer.

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