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flee

Proposed merger of two airlines: Can everyone fly now?

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The rumoured merger between our national flag carrier, Malaysia Airlines Berhad (MAS), and our largest low-cost airline carrier, AirAsia Group (AirAsia), has been the talk of the town for a few weeks amid the Covid-19 pandemic.

With many airlines across the globe slumping into voluntary administration, including Virgin Australia Group (Virgin), Australia's first big corporate casualty of the pandemic, the aviation industry faces a threat of significant decline of market competition.


For instance, the falling of Virgin may prompt Qantas Airways Limited (Qantas) to arise as the only significant airline player in Australia, leading to plummeting competitive levels in Australia. The aviation market there had been previously duopolised by both Virgin and Qantas.

According to Australian authorities, swift action in enforcing competition laws will be taken by its antitrust watchdog against anti-competitive behaviour such as attempts to swamp airline routes, artificially push down prices or lock in exclusive deals with airports and suppliers in a bid to ensure that airlines are able to compete effectively as the industry rebuilds.

It is therefore clear that although the primary goal of an airline merger is to enable parties to eliminate duplicative operating costs, thereby reducing their total costs on labour, service and operations whilst maximising revenue, the after-effects of a merger involving two major competing airline titans raises far-reaching concerns.

Anti-competitive practices may tend to arise including an increase in airfares, reduction of flight frequencies and deteriorating service quality due to a lower degree of competition. This article is aimed at discussing some competition law issues which may ensue from a merger between MAS and AirAsia.

Full article here: https://www.malaymail.com/news/what-you-think/2020/05/05/proposed-merger-of-two-airlines-can-everyone-fly-now-ooi-bee-hong-and-annab/1863136

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Should enable ffp collection and interconnecting plus codeshare for domestic and international. But if it ends up like ak's no frills selection plus space flex seat no thanks. 

Edited by jahur

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From a competition point of view, if there is a merger the two airlines cannot remain as they are. Some sort of restructuring has to take place, especially in the management structure of MAG. However, the result may not be good for consumers, especially for domestic flights.

I still can't see a merger happening - it will kill both airlines!

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7 hours ago, JuliusWong said:

Too much bad blood between both......next story please.

Khazanah is still not letting go the idea... 

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11 minutes ago, flee said:

Khazanah is still not letting go the idea... 

What alternative available to MAG? For certain, none of airlines or foreign sovereign wealth fund is interested.

Khazanah should take the opportunity to close this zombie company else would just draining the resources. After the economy is recovered, could used money saved to incubate a new airlines.

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1 hour ago, KK Lee said:

What alternative available to MAG? For certain, none of airlines or foreign sovereign wealth fund is interested.

Khazanah should take the opportunity to close this zombie company else would just draining the resources. After the economy is recovered, could used money saved to incubate a new airlines.

Close it down no problem. Be sure to maintain flights and sectors and avoid killing off 50k worth of employment in the ecosystem. At the moment you cant it will involve network cut of at least 5-10 years if it were to be passed to a new airline. That's why there were thoughts on merging AAGB and MAG as it would minimise this issue.

Meanwhile Thai, Philippines and Garuda will be receiving aid from their respective govs. 

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Do the same as South Africa? 

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On 5/6/2020 at 7:52 PM, jahur said:

Close it down no problem. Be sure to maintain flights and sectors and avoid killing off 50k worth of employment in the ecosystem. At the moment you cant it will involve network cut of at least 5-10 years if it were to be passed to a new airline. That's why there were thoughts on merging AAGB and MAG as it would minimise this issue.

Meanwhile Thai, Philippines and Garuda will be receiving aid from their respective govs. 

Merger of AAGB and MAG will have a crash of corporate culture. unemployed MAG staffs could seek employment elsewhere. besides many are already on unpaid leave.

 

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On 5/7/2020 at 4:06 PM, Kenny Sing said:

important thing is the RAS has to be maintain as it is essential.

they need to approach RAS with a different mind-set. Equipment type is all wrong, (ATR72 and DHC)  .. it should be floatplanes and single engine types to really serve it's purpose. Example people in Kapit need to travel 5 hours by BOAT to reach their nearest airport in Sibu.
 

If taking Bintulu - Sibu flight, the journey to the airport (half hour) is longer than the actual flight time !

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1 hour ago, Timothy said:

they need to approach RAS with a different mind-set. Equipment type is all wrong, (ATR72 and DHC)  .. it should be floatplanes and single engine types to really serve it's purpose. 

Single engine does not work. Really buzz my mind why would anyone think of using single engine turboprop for ras with commercial pax onboard, insurance comes in mind cuz the rates of this type of planes going down is higher. Its okay if it was just flying doctors or mail goods delivery service. Even GA operators like Hornbil, Sabah Air and Layang-layang in Sabah Sarawak operates small twin engines turboprops.

Nowadays You have turbo commander, viking otters, dornier serving well in ras pax sectors and some can be converted to floaters.

Edited by jahur

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On 5/27/2020 at 1:15 PM, jahur said:

Single engine does not work. Really buzz my mind why would anyone think of using single engine turboprop for ras with commercial pax onboard, insurance comes in mind cuz the rates of this type of planes going down is higher. Its okay if it was just flying doctors or mail goods delivery service. Even GA operators like Hornbil, Sabah Air and Layang-layang in Sabah Sarawak operates small twin engines turboprops.

Nowadays You have turbo commander, viking otters, dornier serving well in ras pax sectors and some can be converted to floaters.

First and foremost, cost. Twins are more expensive up front, and more expensive to operate compared to single engine. Simply put, double the engine, double the complexity, double the fuel etc of a single engine. Anything that is subsidized will never last, so may as well get it over with and use cost effective options to get the job done. Don't "plan for the next 30 years" and build faraway airports just to cater less than 10 flights a day with planes that are too big for their purpose !

In terms of safety, have you experienced an engine failure in flight ? If not, then the chances of it happening on a single engine is the same. There's no guarantee either that the crew will know how to manage a engine failure situation in multi-engine aircraft ie: TransAsia Airways Flight 235
 

RAS should be plain and simple, like a bus ride. Pay RM100 and fly for an hour ... not the current way of compulsory pre-booking, loyalty program, moving prices ... wrong model for it's purpose.

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43 minutes ago, Timothy said:

First and foremost, cost. Twins are more expensive up front, and more expensive to operate compared to single engine. Simply put, double the engine, double the complexity, double the fuel etc of a single engine. Anything that is subsidized will never last, so may as well get it over with and use cost effective options to get the job done. Don't "plan for the next 30 years" and build faraway airports just to cater less than 10 flights a day with planes that are too big for their purpose !

In terms of safety, have you experienced an engine failure in flight ? If not, then the chances of it happening on a single engine is the same. There's no guarantee either that the crew will know how to manage a engine failure situation in multi-engine aircraft ie: TransAsia Airways Flight 235
 

RAS should be plain and simple, like a bus ride. Pay RM100 and fly for an hour ... not the current way of compulsory pre-booking, loyalty program, moving prices ... wrong model for it's purpose.

Take a look at susi air how many of their pilatus porter went down. Mas fokker, atr and otters had few cases of engine failure and they all circled back with one engine without needing to write off any frame or grand insurance payout to dead folks. If you had one engine n it fails you have to ditch. 

Ask around the crew working in GA over here nobody is keen on single engine turborprop and helicopters. So many bell 206 crew had vacated for augsta westland aw139 and aw109 even if the payrate is lower.

Even Maswings had issues recruiting crew for the viking fleet last year and had to make salaries competitive to near widebody fleet levels to keep them cause people just leave. People are scared to fly in the topography and weather in Borneo. Heck i rode on a twin engine airbus helicopter for medicine resupply and census recording in rundum and experience 2 rtbs on 2 consequtive days just because of weather. Doctors and nurses are not keen on riding it again as well. Try getting a fleet cesna grand caravan single crew rated(CAAM DOES NOT ALLOW THIS)and keep low salary. 

You want a better plan build road highways that dun screw up the flora and fauna. 

Edited by jahur

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