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Mohd Suhaimi Fariz

MAS Privatisation

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I think this news is about leasing the 4 A359 which all of us here have known ages ago.

 

This news (MH wanting to expand its fleet) does not make sense especially when we knew that they just retired their entire B772 fleet, they wanted to sell all their A380 and retire the fleet in 2017, they plan to retire like 20 (?) leased B738 and the only new aircraft coming in are the 4 leased A359 in 2017 to replace the A380 and the 2 option of A339.

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..... MAB cannot afford to fail another time.

Serious ?

I don't recall the description of 'failure' having been employed previously, so this must be a new concern :)

 

 

I think this news is about leasing the 4 A359 which all of us here have known ages ago.

I have a suspicion that Bloomberg report has been 'tidied up' - I distinctly remember reading an earlier a version with Herr Mueller's "maybe" response to query about the A359 in MAB's fleet :) Edited by BC Tam

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I think this news is about leasing the 4 A359 which all of us here have known ages ago.

 

This news (MH wanting to expand its fleet) does not make sense especially when we knew that they just retired their entire B772 fleet, they wanted to sell all their A380 and retire the fleet in 2017, they plan to retire like 20 (?) leased B738 and the only new aircraft coming in are the 4 leased A359 in 2017 to replace the A380 and the 2 option of A339.

This interview was conducted at the Singapore Air Show conference today. So it is an update of the situation at MAB. Looks like they have given up trying to sell the A380s.

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If one goes around town and say that one is desperate to let go of the A380s, of course one should not expect anything more than a fire sale.

 

Whilst LHR runs are double daily, Real Madrid charters and Umrah charters are very seasonal or occasional. Yes, when stars are in alignment, all six frames are flying, but more often than not, 2 frames would be lying around. The reality is that MH never did acquire the A380s to do soccer team or umrah charters. So Mueller is just painting a rosier picture to camouflage any desperations in shedding the excess capacity.

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So Mueller is just painting a rosier picture to camouflage any desperations in shedding the excess capacity.

Well, they have to make the best of what they have. Since they are not able to dispose of the excess frames, they had to find ways to utilise the assets to generate some return. They will still have to pay for the leases even if the aircraft are not used.

 

It kinda reminds me of what D7 had to do with the two A340s after they suspended their LGW and ORY services.

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To be honest, mulling fleet expansion now is good - indicates that early stage targets have/or are being met and more concrete forward planning can occur.

 

Perhaps even an MoU for B737MAX might be in the offing, given that the region and such a fleet are at the forefront of the BOP.

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Mueller is playing his role as a corporate man. He needs to show progress. On ther hand, if you predicting a profit by 2018 and a fleet expansion there after, wouldn't one be going shopping for new equipment soon since the waiting period is pretty long...

 

Did they pitch the A380 to British Airways?

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Mueller is playing his role as a corporate man. He needs to show progress. On ther hand, if you predicting a profit by 2018 and a fleet expansion there after, wouldn't one be going shopping for new equipment soon since the waiting period is pretty long...

 

Did they pitch the A380 to British Airways?

With the retirement of the B777s, the MH fleet is relatively young. We will see the long haul fleet grow a little with the leasing of four A350s and, possibly, some A330neos.

 

He also mentioned that they would like to own more of their aircraft - so, they may order some new aircraft to replace those whose lease will expire. Here, I see potential for aircraft like the A321neo and A321neo LR. As MH expands its regional network, these aircraft will help increase capacity as well as operate longer routes. The A321neo LR is capable of reaching Australia and deep into China, Korea and Japan.

As for the A380s, I think the problem of wrong configuration makes them very hard to sell. Reconfiguring the aircraft is time consuming and expensive - that makes it hard to sell used A380s unless you offer them at giveaway prices.

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Wonder how the economics work for a combo order of 787-8's and A350-900's.

 

The 787-8 would be suitable for thinner routes whilst also able to go the distance and of course for the longer haul, the A350-900.

 

Hopefully in the long term some A350-1000's when MH is ready to grow again.

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Wonder how the economics work for a combo order of 787-8's and A350-900's.

 

The 787-8 would be suitable for thinner routes whilst also able to go the distance and of course for the longer haul, the A350-900.

 

Hopefully in the long term some A350-1000's when MH is ready to grow again.

MH has already outlined their plans to focus on their regional network, which is their A330s are perfectly capable of. The only long-haul destination they're going to focus on in the foreseeable future is LHR, which will be served by the A350s, so no need for the 787.

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MH has already outlined their plans to focus on their regional network, which is their A330s are perfectly capable of. The only long-haul destination they're going to focus on in the foreseeable future is LHR, which will be served by the A350s, so no need for the 787.

 

Replacements for their A330s and their Oceania/North Asia routes?

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MH has already outlined their plans to focus on their regional network, which is their A330s are perfectly capable of. The only long-haul destination they're going to focus on in the foreseeable future is LHR, which will be served by the A350s, so no need for the 787.

 

True, but if MH has the correct planes, surely they can restart Europe again with the 787. For example CDG and AMS, which would be a stretch for the A330 (not sure if the -900 can make the distance?).

 

I am speaking about longer term, not merely 2-3 years down the line..

 

Unless of course you think MH is doomed forever to just be a regional carrier? :) I am not that pessimistic.

Edited by jani

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Believe current gomen lacks the appetite or have ceo that could convince pm to expand mh beyond current size. However, things could change after 2018.

Edited by KK Lee

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Replacements for their A330s and their Oceania/North Asia routes?

The A330s are going to be around for quite some time. They're still relatively young, and about to undergo refurbishment. In order to make the investment worthwhile they'll have to keep it for at least 6-7 years.

 

I'm not saying they should wait for the planes to fall apart before thinking of replacements. I'm just pointing out they still some time to consider. Hopefully by then, when they're in a stronger financial position and ready to expand once again, they can have a better idea of what they actually need.

 

 

True, but if MH has the correct planes, surely they can restart Europe again with the 787. For example CDG and AMS, which would be a stretch for the A330 (not sure if the -900 can make the distance?).

 

I am speaking about longer term, not merely 2-3 years down the line..

 

Unless of course you think MH is doomed forever to just be a regional carrier? :) I am not that pessimistic.

Why the rush to get 787s to restart routes they've only recently cut? They're going to have to stop the bleeding before they're in any position to restart more European flights. MH has already gone down the Airbus route when it comes to their long-haul fleet, which makes it more sensible for them to get more A350s and/or A330neos once they're ready to expand again rather than introduce an entirely new aircraft type. The A330-800 should be able to serve the "thinner" long haul routes you mentioned, and nicely complement the A350.

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Wonder how the economics work for a combo order of 787-8's and A350-900's.

 

The 787-8 would be suitable for thinner routes whilst also able to go the distance and of course for the longer haul, the A350-900.

 

Hopefully in the long term some A350-1000's when MH is ready to grow again.

I don't think MH's priority is long haul - LHR is the exception because it is a flagship route and LHR slots are valuable, MH is not about to do something stupid like selling its slots for £75m per slot pair (Oman Air paid this price)!

 

As it has entered into an agreement with EK, it will not be very clever to duplicate their network. QF did the same thing and cut back on its EU flights. So it is better to build up the Asia Pacific network in order that EK can load its pax onto MH metal. EK has not fully built up its Asian network and can supply feed to MH. That is what partnerships are for - consolidate and share resources for the benefit for all partners.

 

If MH expands its Asian networks, they only really need mid sized widebodies like the A330-300 and A330-900. On thinner routes, the A321neo will be a good upgrade for routes currently served by B738s. Airlines like EVA Air, Vietnam Airlines, Philippine Airlines and VietJet are finding the A321 to be a very good plane for their networks.

 

With MH having A330 and A380 on their fleet for regional and long haul destinations, integrating the A321neo into the fleet would not be a difficult thing for them to do. And if the experience of A320 launch operator LH is anything to go by, the neo is doing great things, providing significantly lower operating costs.

 

As such, a new aircraft type like the B787 will increase costs - not something MAB will welcome.

The A330s are going to be around for quite some time. They're still relatively young, and about to undergo refurbishment. In order to make the investment worthwhile they'll have to keep it for at least 6-7 years.

Yes, the first A330 is only 5 years old and their youngest member is only 2.1 years old - so there is still a lot of life left on the A330 fleet.

Edited by flee

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Wonder what Mueller was doing in MEL, but he was recently downgraded from J to Y on that particular flight! Well its great to know that the CEO values customers more! :)

 

 

 

"We just have capacity for existing demand," he said. "I think we are not in the business to further shrink. I recently was flying back from Melbourne to Kuala Lumpur and I was downgraded to economy because business class was fully booked. That was good news."

 

Read more: http://www.smh.com.au/business/aviation/forget-bali-come-to-kota-kinabalu-malaysia-airlines-boss-christoph-mueller-20160215-gmutq6.html

Edited by Kris Kim

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Wonder what Mueller was doing in MEL, but he was recently downgraded from J to Y on that particular flight! Well its great to know that the CEO values customers more! :)

 

 

 

 

+1

Like!

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MAS improves operation in the latest quarter

 

KUALA LUMPUR: Malaysia Airlines has recorded a 10% improvement in revenue per available seat kilometre for the quarter ended Feb 29, 2016.

In a statement, the national airline said the improvement was due to route optimisation exercise conducted earlier. Seat load factor was also better with more than 350,000 passengers traveling with MAS over the Chinese New Year holidays.
The company’s operations team strives to improve punctuality and on time performance (OTP).
“Malaysia Airlines needs to win on customer service and this is being benchmarked against our competitors , who are operating at 85% OTP at the highest end and 57% OTP at the lowest,” it said in a statement on Friday.
In February 2016, punctuality reached 85% while on Feb 17, 2016 the airline hit a record 95% punctuality across all flights with 100% on domestic operations.

MAB's Revenue Per ASK Up 10 Per Cent On Route Optimisation
March 04, 2016 19:29 PM
KUALA LUMPUR, March 4 (Bernama) -- Malaysia Airlines Bhd's (MAB) revenue per available seat kilometre (ASK) for the quarter ended Feb 29, 2016 improved 10 per cent year-on-year on the back of the route optimisation exercise.
In its quarterly progress update, the national carrier said the seat load factor was also showing improvements with over 350,000 passengers travelling with the airline during the Chinese New Year holiday.
It said on time performance (OTP) dipped in December 2015 due to adverse weather conditions and constraints in availability of aircraft, but it recovered to 85 per cent in February.
"On Feb 17, the airline hit a record 95 per cent punctuality across all flights with 100 per cent on domestic operations," MAB said.
Group Chief Executive Officer Christoph Mueller said the quarter was challenging but the airline was pleased to see continued progress in all key areas such as OTP and costs.
"MAB has been operating for six months now and although we have a long way to go and areas for improvement, we are making steady progress in the restructuring," he said.
During the quarter under review, MAB began its global aviation partnership agreement with Emirates Airlines, which saw both carriers placing its codes on the Kuala Lumpur-Dubai route, as well as other routes under the agreement.
The first phase of the agreement would see 11 destinations introduced, including Rome, Paris, Madrid and Frankfurt, with the rest being added progressively over the next few months.
Once completed, Malaysians would have access to over 30 destinations in Europe, Middle East, Canada, and Africa.
Furthermore, it said the partnership with Emirates would contribute to its fleet consolidation and enable it to retire the B777-200s completely, allowing MAB to drive down complexity in maintenance, engineering and flight operations.
MAB had ordered four brand new Airbus A350-900s aircraft, which would be able to operate non-stop from Kuala Lumpur to London and throughout Asia, with deliveries to start in October 2017.
"The airlines' A380s are due for scheduled maintenance at the beginning of the second quarter of this year, which means that an average of one A380 aircraft being out of commission for the remainder of 2016.
"In anticipation of this, the airline is exploring reinstating a former flagship aircraft to ensure minimal interruptions on the London route," the airline said.
To ensure convenience and improved connectivity for passengers, MAB planned to concentrate most of its operations at the Kuala Lumpur International Airport's (KLIA) main terminal.
This would translate into quicker connections for ASEAN passengers between international and domestic flights, thus improving flight connection times, providing faster and more reliable baggage transfer and ultimately ensuring better customer satisfaction.
Moving forward, MAB said to address skills gaps, the airline would explore joint ventures with established international organisations to provide training and specific skillsets.
"The airline has been working hard in closing the skills gap via the Malaysia Airlines Academy, whereby the newly revamped academy will ensure that future generations of leaders for the airline will be groomed entirely from within.
"To this end, MAB has recruited 20 management trainees towards building a talent pipeline as well as growing the aviation skillsets in Malaysia," it added.

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"The airlines' A380s are due for scheduled maintenance at the beginning of the second quarter of this year, which means that an average of one A380 aircraft being out of commission for the remainder of 2016.

 

"In anticipation of this, the airline is exploring reinstating a former flagship aircraft to ensure minimal interruptions on the London route," the airline said.

Wow !! :)

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Not sure why they had to do that - four aircraft would be sufficient to mount double daily flights to LHR.

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