MAS Privatisation

[Craig 0]

 

Tourism Malaysia Concerned Over Rumour Of MAS Service Discontinuation To Frankfurt

By Manik Mehta

FRANKFURT, Sept 7 (Bernama) -- The Tourism Malaysia office here is deeply concerned over a rumour that Malaysia Airline (MAS) might discontinue its five-weekly flights to Frankfurt.

Germany flag carrier, Lufthansa, like MAS, also operates five-weekly flights to Malaysia, but other airlines that provide connectivity to Malaysia must first fly to their home base before flying to Malaysia.

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They include Cathay Pacific, Asiana, Singapore Airline and Thai Air.

Maizan said MAS is a boon for German travellers heading to Malaysia like Thai Air, which flies twice weekly from Frankfurt and once a week from Dusseldorf to Bangkok, to cater to increasing number of German travellers visiting Thailand.

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In March, MAS Frankfurt office director David Raj denied the rumours that MAS would discontinue its five-weekly flights to Frankfurt.

 

 

This article has *so many* inaccuracies. I think they meant twice daily from BKK to FRA and once daily from BKK to DUS (which hasn't opened for reservations yet). Asiana - yes, but only to BKI, and why they fail to mention any of the ME3 is shocking.

[Mike P 0]

May be MH could try to work out with LH to complement each others on the KUL - FRA route.

[flee 5]

May be MH could try to work out with LH to complement each others on the KUL - FRA route.

Yes, do a code share and both airlines will have a daily service. 7 flights per week between them should allow the route to be profitable.

[KK Lee 5]

May be MH could try to work out with LH to complement each others on the KUL - FRA route.

 

Yes, do a code share and both airlines will have a daily service. 7 flights per week between them should allow the route to be profitable.

 

Asking the German to work with MH? You must be kidding.

[Mohd Azizul Ramli 2]

Per recent discussion about the Germans in Golden Lounge:

 

 

 

German/LH:

Most trustworthy

Most arrogant

Least compassionate

Most hardworking

Least corrupt

 

Malaysian/MH:

Cannot be trusted and full of udang di sebalik batu.

Quite arrogant (rather spent RM 6 billion than declare bankruptcy for MH and start afresh on a new flag carrier) and seasonally influenced by local telenovela [i Love You Mr. Arrogant])

Most compassionate (even to terminate excess staff is done in the most compassionate manner, no termination but instead transfer to other companies even though they are not needed there, kambing nangis pun kesian nak kasik derma, kera di hutan pun kesian also dicari untuk disusukan etc)

Quite lazy in general (staff productivity level is only half of SQ and CX)

Definitely corrupt (Mr. 017, Brahim contract etc)

 

Conclusion: It won't work due to extreme clashes in personality trait and working culture. The only similarity shares is the arrogantness.

 

German/LH is more of a closer match to Singaporean/SQ. History proved that Malaysian/MH is definitely cannot gel with Singaporean/SQ, so it won't work with German/LH.

[nrazmoor 0]

I think if both MH and LH can see the benefits of their relationship/codeshare why not?? I mean just look at QF and EK tie-ups, and at the same ttime QF terminate their JV with BA who ever thought of that? Besides, it is more likely that LH to have some sort of relationship with MH than with the ME3

 

Btw, imo MH need to lease 789 like immediately to serve dest like FRA/AKL and replace one of the A380 to LHR with 789.

Edited September 8, 2014 by nrazmoor

[KK Lee 5]

I think if both MH and LH can see the benefits of their relationship/codeshare why not?? I mean just look at QF and EK tie-ups, and at the same ttime QF terminate their JV with BA who ever thought of that? Besides, it is more likely that LH to have some sort of relationship with MH than with the ME3

 

Btw, imo MH need to lease 789 like immediately to serve dest like FRA/AKL and replace one of the A380 to LHR with 789.

 

On KUL-BKK and KUL-SIN, LH codeshare with TG and SQ respectively. It is unlike German culture to abandon TG or SQ just for FRA-KUL.

[Radzi 2]

"So maybe the best solution is to store them, since every ticket sold nowadays results in a loss. Cutting flights will definitely cut losses".

 

Make sense. Good reason to cut off AMS and FRA since the flights are almost always full. In fact MH should make billions of profit by flying routes with empty seats.

[Ja Singh 2]

"So maybe the best solution is to store them, since every ticket sold nowadays results in a loss. Cutting flights will definitely cut losses".

 

Make sense. Good reason to cut off AMS and FRA since the flights are almost always full. In fact MH should make billions of profit by flying routes with empty seats.

They should add another 2 A380's and complete their line up of brand new aircraft,dispose all T7's.All long haul on A380's for LHR,FRA,AMS,AKL,CDG.

Edited September 8, 2014 by jadivindra

[flee 5]

They should add another 2 A380's and complete their line up of brand new aircraft,dispose all T7's.All long haul on A380's for LHR,FRA,AMS,AKL,CDG.

Yes, lease them from Amedeo.

Or, if they want to fast track it - take the Skymark ordered aircraft and they can have them next year!

"So maybe the best solution is to store them, since every ticket sold nowadays results in a loss. Cutting flights will definitely cut losses".

 

Make sense. Good reason to cut off AMS and FRA since the flights are almost always full. In fact MH should make billions of profit by flying routes with empty seats.

Sarcasm aside, this is probably being seriously considered by the restructuring team! JAL shrunk its operations substantially to restructure before expanding again.

 

MH might follow the same route - cut operations/downsize so that it is easier to bring things under control. Then expand again.

Edited September 9, 2014 by flee

[Waiping 12]

I am not getting the idea behind acquiring more aircraft now, at a time when MH need to stop spending money. In fact their current lineup is pretty new - A380, A333, B738. They really need to work with those.

[flee 5]

I am not getting the idea behind acquiring more aircraft now, at a time when MH need to stop spending money. In fact their current lineup is pretty new - A380, A333, B738. They really need to work with those.

Well they have to look at all options - that is what brainstorming is all about.

 

Yes, I think that they should just retire the B772s and conserve cash. If they still plan to fly all existing long haul routes, they might want to refurbish a few of the newer (lower cycle) ones with new seats (maybe slightly higher density) to improve economics. This will buy some time for MH to consider their next aircraft orders.

[KK Lee 5]

Yes, lease them from Amedeo.

Or, if they want to fast track it - take the Skymark ordered aircraft and they can have them next year!

Sarcasm aside, this is probably being seriously considered by the restructuring team! JAL shrunk its operations substantially to restructure before expanding again.

 

MH might follow the same route - cut operations/downsize so that it is easier to bring things under control. Then expand again.

 

Before MH is resurrected, they need to decide what newco wants to be? A LCC, focus on O&D, focus on regional, to compete with ME3 for a slice of cake, etc before they could determine what are right equipment for the job.

 

Given corporate history in this country, they often place the cart in front of the horse.

[BC Tam 2]

Close down MAS and overhaul Khazanah, says veteran newsman
http://www.themalaysianinsider.com/malaysia/article/close-down-mas-and-overhaul-khazanah-says-veteran-newsman

[flee 5]

Before MH is resurrected, they need to decide what newco wants to be? A LCC, focus on O&D, focus on regional, to compete with ME3 for a slice of cake, etc before they could determine what are right equipment for the job.

 

Given corporate history in this country, they often place the cart in front of the horse.

Yes, the problem with the post TR debacle MH is that it lost its sense of direction. It did not know how to compete - a very common trait of GLCs that are protected from real competition by the govt.

 

2015 will see the ASEAN Open Skies and Economic Community come into operation. Whether the newco sees this as an opportunity or a threat is key to whether the new MH succeeds or fail again.

[Mohd Azizul Ramli 2]

Close down MAS and overhaul Khazanah, says veteran newsman

http://www.themalaysianinsider.com/malaysia/article/close-down-mas-and-overhaul-khazanah-says-veteran-newsman

 

To think of it, this is actually true. The problem with MAS all these years is Khazanah, so Khazanah is the one that need to be revamped.

[Ja Singh 2]

I am not getting the idea behind acquiring more aircraft now, at a time when MH need to stop spending money. In fact their current lineup is pretty new - A380, A333, B738. They really need to work with those.

Sometimes despite how injured we are we have to continue to march forward if we want to survive. Since the dcision has been made not to shut MH,the only way forward is consistent products and metal and of couse restructure. Further more A380 is a crowd puller,MH A380 LHR flights full for whole month of september.With the retirement of T7 fuel expenditure can go down and one less fleet type as well,less cost.Even if they dont get 2 new planes,the 6 billion will just vanish without accoutability. So might as well get new planes and try luck. SQ daily A380 ex AKL,and also Air NZ daily 777W to SIn.Fare structure can be adjusted accordingly.

 

Even a chef can cook a great dish if given sub par stove and utensils.Same applies with MH if not great inflight products at least new planes.

Edited September 9, 2014 by jadivindra

[flee 5]

Sometimes despite how injured we are we have to continue to march forward if we want to survive. Since the dcision has been made not to shut MH,the only way forward is consistent products and metal and of couse restructure. Further more A380 is a crowd puller,MH A380 LHR flights full for whole month of september.With the retirement of T7 fuel expenditure can go down and one less fleet type as well,less cost.Even if they dont get 2 new planes,the 6 billion will just vanish without accoutability. So might as well get new planes and try luck. SQ daily A380 ex AKL,and also Air NZ daily 777W to SIn.Fare structure can be adjusted accordingly.

 

Even a chef can cook a great dish if given sub par stove and utensils.Same applies with MH if not great inflight products at least new planes.

Yes, the A380 is a passenger magnet but MH should use it as a tool to improve its yields and not discount their fares to fill the aircraft. As such, it is a good opportunity for MH to use it to premier a new premium product with a unique selling proposition.

 

The A380 replacing the B744 was an easy decision as the trip costs are only slightly higher. But for MH to replace the B772 with the A380, there has to be serious research as the resulting increase in ASKs may result in over capacity for the affected market. So it is not such an easy decision.

[Johan Z 0]

MH can utilise A380s effectively if they don't drop their airfare too much.

[KK Lee 5]

MH can utilise A380s effectively if they don't drop their airfare too much.

Every additional fare paid is more than increased in marginal cost I.e fuel, meal, airport tax is a positive contributions to the bottom line. It is better to fill the cabin than flying it half empty.

 

The issue is with mh overhead and brand not aircraft type.

[flee 5]

The issue is with mh overhead and brand not aircraft type.

I tend to agree with you on this point. MH's CASK is just too high - they really have to get to grips with their costs.

 

The problems at MH are not that bad - I'd rather be trying to turn MH around than to turn TG around (from an operational point of view). The biggest of MH's problems is politics - cut that out of MH and things will be fine. Even without further new aircraft, MH should be OK for at least the next 3 years. After that, MH will definitely need more fuel efficient aircraft

 

But before anything else, MH will need to decide which business model to adopt. It needs a real sense of direction and purpose. It needs a mission statement, a war cry, to focus all who work in it. It cannot just wallow and respond to what the competition is doing. It must have its own ideas as to what kind of airline it should be and pursue that objective relentlessly.

[flee 5]

Malaysia Airlines starts to address deep-rooted financial woes

 

The question now is whether the plan, which involves pumping $1.9bn of cash into the airline over three years, will be enough.

Previous restructurings have come and gone and the airline has still notched up cumulative net adjusted losses from 2001 to 2014 of Rm8.4bn ($2.6bn).

Last month it reported a widening of quarterly losses to Rm307m, compared with a net loss of Rm176m in the same period a year ago.

A cumulative Rm17.4bn was pumped into the airline by the government in those 13 years – an amount that Khazanah says could have linked more than 200,000 rural households in Malaysia to running water and electricity instead.

Mohshin Aziz, an aviation analyst at Maybank, is sceptical. “Name me one company that a management consultant has successfully built from the ground up? Stretch your imagination a bit, don’t limit it to Malaysia, think globally as well. Still nothing, huh? I rest my case,” he wrote in his last research note on Malaysia Airlines.

The company’s shares are being delisted by the end of the year as part of an offer by Khazanah – the 69 per cent shareholder – for the remaining stock. Its assets will be transferred into a new company by July 2015. The plan envisages the company will be profitable by 2017, with a relisting possible between then and 2019.

Yet there are reasons for guarded optimism. For a start, no previous plan has attempted seriously to tackle one of Malaysia Airlines’ biggest problems: its workforce of 19,500 is about 30 per cent more than at comparable airlines. The Khazanah plan calls for 6,000 redundancies.

Malaysia Airlines’ efficiency is questionable. In terms of available seat kilometres – a measure of aircraft capacity calculated by multiplying the number of seats available by average distance flown – Malaysia Airlines is on 3.6m per employee, lagging behind Cathay Pacific and Singapore Airlines on 5.1m and 6.1m respectively.

The airline’s unions have limited staff cuts in the past, but their relatively muted response to the Khazanah plan suggests things might be easier this time.

“I think the difference between this restructuring and many others is the sheer determination by all parties,” says Tony Fernandes, founder and chief executive of AirAsia , Malaysia Airlines’ main rival in the region.

“It’s the first time I’ve seen the political will, with Khazanah and everyone saying ‘we’ve got to fix this’, and I think that’s the difference. I think the plan has a good chance.”

Full report here: http://www.ft.com/cms/s/0/6530cd92-36e8-11e4-95d3-00144feabdc0.html

[flee 5]

AirAsia Willing To Take In Laid Off MAS Employees

 

KUALA LUMPUR, Sept 10 (Bernama) -- Low-cost carrier AirAsia Bhd is willing to take in some of Malaysia Airlines (MAS) employees following Khazanah Nasional Bhd's plan to lay off some 6,000 staff under the national carrier's restructuring plan unveiled more than a week ago.

The 6,000 workers represent about 30 per cent of the total 20,000 workforce in MAS.

"AirAsia X and AirAsia are growing, of course we will do the best to absorb as many as possible and we have been (absorbing MAS staff) anyway.

"We have grown from 200 employees to 15,000 and a lot of them came from MAS," the low-cost carrier's Chief Executive Officer Tan Sri Tony Fernandes told reporters after launching a collaboration campaign, "Fill Up and Fly Free" with Petronas Dagangan Bhd here today.

He said the transition of employees from MAS joining the AirAsia group was healthy due to differing preferences of airline employees, some of whom might want to work with low-cost carriers rather than premium airlines.

About 50 per cent of AirAsia's employees were formerly with MAS.

"Some of AirAsia staff have gone to MAS as well and that is healthy as there are some people wanting low-cost and some wanting premium airlines," he said.

Khazanah Nasional, the government's investment arm, was now in possession of 69.3 per cent of the flagship carrier and would likely own the entire shareholding in MAS following an offer to buy the remaining equity at 27 sen per share from minority shareholders.

The restructuring of MAS is expected to cost RM6 billion.

[KK Lee 5]

 

AirAsia Willing To Take In Laid Off MAS Employees

 

KUALA LUMPUR, Sept 10 (Bernama) -- Low-cost carrier AirAsia Bhd is willing to take in some of Malaysia Airlines (MAS) employees following Khazanah Nasional Bhd's plan to lay off some 6,000 staff under the national carrier's restructuring plan unveiled more than a week ago.

The 6,000 workers represent about 30 per cent of the total 20,000 workforce in MAS.

"AirAsia X and AirAsia are growing, of course we will do the best to absorb as many as possible and we have been (absorbing MAS staff) anyway.

"We have grown from 200 employees to 15,000 and a lot of them came from MAS," the low-cost carrier's Chief Executive Officer Tan Sri Tony Fernandes told reporters after launching a collaboration campaign, "Fill Up and Fly Free" with Petronas Dagangan Bhd here today.

He said the transition of employees from MAS joining the AirAsia group was healthy due to differing preferences of airline employees, some of whom might want to work with low-cost carriers rather than premium airlines.

About 50 per cent of AirAsia's employees were formerly with MAS.

"Some of AirAsia staff have gone to MAS as well and that is healthy as there are some people wanting low-cost and some wanting premium airlines," he said.

Khazanah Nasional, the government's investment arm, was now in possession of 69.3 per cent of the flagship carrier and would likely own the entire shareholding in MAS following an offer to buy the remaining equity at 27 sen per share from minority shareholders.

The restructuring of MAS is expected to cost RM6 billion.

 

 

Basically, MH had the opportunity to reduce head count over the years but decide otherwise.

Edited September 10, 2014 by KK Lee

[BC Tam 2]

Aviation price war ending as airlines tired of losing money, says Tony Fernandes
http://www.themalaysianinsider.com/malaysia/article/aviation-price-war-ending-as-airlines-tired-of-losing-money-says-tony-ferna

 

Awh, please don't let the good times be coming to an end !