MAS/KLM cooperation on trans-atlantic & europe

[Keno Omar 0]

One positive thing that has came out from the recent turnaround plan was that MAS management has begun to admit some of their true weaknesses and to stop following SQ's model regardless of its suitability for MAS/KUL own market. Most if not all of MAS european routes are loss-making and yet they used to fly to 9 european cities before MAN & VIE was recently suspended. KUL is not this region's hub and thus could not support such point-to-point model like SIN/SQ; by comparison even mighty CX only flies to 5 cities with regional connections are made via LHR through BA codeshare.

 

With MAS progressively axing their european cities over the next few years leaving only LHR, AMS, CDG and FRA, the remaining european destinations would be served via codeshare agreement with a global alliance partner which MAS is planning to join soon. There's no prize for guessing the answer would be Skyteam with KLM being the key partner (i would be extremely surprised if MAS goes a different path). By then, cities that are no longer served by MAS namely MAN, VIE ZRH, FCO and ARN, would most likely be served as a codeshare agreement with KLM via AMS. Such agreement would certainly not be limited to the key cities, with possibilities of extending it to other major/regional destinations such as MUC, MXP, GVA, MAD, PRG etc. MAS has been for many years now been codesharing on KLM to CPH, OSL, GOT and ARN; why MAS kept on flying at a loss to other european cities at a loss when KLM codeshare would be a wiser business decision to make is beyond me. I guess in BolehLand, it's all about beating SQ at all cost.

 

It would probably be very likely to see Bmi codeshare via LHR to 7 regional UK/Eire cities be terminated in favour of KLM cooperation. When it comes to connection, many regional UK passengers would rather avoid transiting via LHR and would prefer doing so in continental europe. Plus, KLM has an advantage of having a larger network of UK cities that the locally-based Bmi; KLM also flies to Birmingham, Newcastle, Cardiff, Bristol, Southampton & Humberside which are all not served by Bmi.

 

Now moving on to transatlantic routes. People kept wondering why SQ could support 3x daily to LAX while MH only has 5x a week; similarly the 2x daily to JFK/EWR on SQ while MH remains stagnant at 3x a week. KUL & SIN has a different market and connecting opportunies, the fact that we both sit on the exact geographical doesn't mean squat. Looking at the online schedule at KLM.com, I can't help notice that the connecting timeslots between KUL & North America are pretty ideal even at the moment (we're not talking about SkyTeam era yet). I for one has never been a supporter of MAS's service to EWR, they could barely support a pathetic 3x a week, at first via DXB but they chickened out when EK commence their own service, then switching to ARN which already has direct competition with both SK and CO (both of which have daily service, plus ARN itself as a destination is also highly questionable). And yet for "national pride" or whatever they call it, EWR route remains (hopefully not for long now). Let's face it, MH would never be anywhere near SQ's level in North America; MH tried to expand in Europe and failed, unless we're dealing with regional services to China, India or even I dare say Australia then MH may have some chance.

 

Trans-atlantic cooperation with KLM seems to be a no-brainer to me, with great connection opportunities to most key cities in North America. In my opinion it beats having MH's own service to EWR (with stopover in ARN or wherever), then connecting to Skyteam partner CO to the final destination. With KLM arrangement, it's a one-stop connection to JFK, EWR, BOS, IAD, ORD, DTW (NW), MSP (NW), MEM (NW), ATL, IAH, MIA, YYZ and YUL, most of which are already ideally timed for connection to KUL. Even with MAS joining Skyteam, it would be very hard pressed to see DL or CO serving KUL; and NW's possible resumption would not necessary be a great addition to MAS operation anyway.

 

For the West Coast, MAS route to LAX should stay as the only direct link between Malaysia & USA, plus I doubt the govt would allow MAS to axe it anyway. With the relatively short distance to the west coast compared to the other side, the difference in connecting time on KE/DL/NW service versus a direct MH service doesn't seem to be that convenient. With that said, MH service to LAX should not be seen just as a welfare case to link Malaysia to USA but should also be turned profitable. MH's transpacific 747s now are mostly filled with TPE-bound cheap tickets where competition is fierce. I'm not sure if MAS would do better if the flight is rerouted back to NRT (if slot permits) or a different aircaft and/or configuration, so I welcome others' comment on this.

 

Personally I'd say forget about MH expanding to SFO or ORD, or even keeping the route to EWR. MAS really should venture much further into KLM codeshare (+ Skyteam in general) and stick to the market that performs best rather than simply copying SQ's model.

 

 

Edited June 29, 2006 by Keno Omar

[KK Lee 5]

 

Well said. But Mas is not an ordinary airline operating by business minded people.

 

[Pieter C. 5]

With MAS progressively axing their european cities over the next few years leaving only LHR, AMS, CDG and FRA,

 

Hurray very well stated !!!

Thought it was LHR, AMS. CDG and FCO ?

 

Anyhow, the KUL-AMS-KUL code-share flights have been doing extremely well for both airlines; KLM, at least, would be thrilled to 'open-up' more code-shares with MH; it would be benificial for both airlines

 

[Sneeze Lam 0]

So, the distance between MWingers and Uncle Pieter will be / is getting closer.

[S V Choong 4]

Well said. But Mas is not an ordinary airline operating by business minded people.

 

They seemed to share the same bandwidth with those from the government, milking every drop of the gravy train.

[HSLim 0]

Greetings to all. I just joined.

 

Thank you Keno for providing a solid pilot post to start the discussion.

 

Indeed, many Asia Pacific - Europe (and vv) flights are timed for connection with transatlantics. Yet it has not been a common practice for Asia Pacific carriers to codeshare with European and North American carriers across the atlantic. Also, North America - Asia Pacific itineraries offered by European carriers via Europe are generally pricier than the transpacific options. I suspect that it is because of the traditionally higher operational costs and yield on transatlantic services compared to the transpacifics. KL might agree to sell seats on AMS-NYC to MH at a price that results in the overall KUL-NYC combined fare being much higher than, say, CX/CI/KE might charge for connecting through HKG/TPE/ICN. Actually, there are VS/MH combination fares for NYC-KUL that are not too bad, but it is unclear if MH ends up losing money on those. Working with KE or NW (lousy connection timings) across the Pacific is another option for MH.

 

Meanwhile, I agree that it makes sense for the MH/KL co-operation in Europe to grow.

 

 

 

 

[Keno Omar 0]

Yet it has not been a common practice for Asia Pacific carriers to codeshare with European and North American carriers across the atlantic. Also, North America - Asia Pacific itineraries offered by European carriers via Europe are generally pricier than the transpacific options.

Good point, that probably explains the lack of transatantic codeshares among Asia Pacific carriers. I could think of one example for SQ, they now codeshare with AC from LHR after they ceased to operate into YYZ; and to MCO in cooperation with VS. Despite the cost issue, I believe MAS/KLM could work something out to make the trans-Atlantic cooperation works similar to MAS/KLM cooperation to Australia. MAS could pick key cities in North America namely EWR/JFK, ORD and YYZ to begin with an take it from there for further codeshare expansion. European shorthaul codeshares do not have as much restrictions compared to trans-Atlantic, so MAS should make full use of their cooperation with KLM to serve other key and secondary european cities. MAS's resources should be channelled to the markets that they do best rather than blindly continue operating loss-making routes.

 

I'm wondering how Air France sees all these present/future cooperation between KLM & MAS...

[Fitri Shukri 0]

Thank you for the article Keno. Hope MAS management reads this.

 

Just a question, if your proposal is accepted, and MH decides to codeshare with KLM and join SkyTeam, does this justify the need for A380 in MAS? Meaning the A380 to serve several times daily KUL-AMS, KUL-LHR and possibly a KUL-SYD.

Edited June 30, 2006 by Fitri Shukri

[Sandeep G 1]

Well said... Skyteam lah.. only solution! Then KL, CO AND NW will be open for MAS - and not just through AMS (LGW is in my mind - despite the place being so crazily congested)..

 

 

[HSLim 0]

Good point, that probably explains the lack of transatantic codeshares among Asia Pacific carriers. I could think of one example for SQ, they now codeshare with AC from LHR after they ceased to operate into YYZ; and to MCO in cooperation with VS. Despite the cost issue, I believe MAS/KLM could work something out to make the trans-Atlantic cooperation works similar to MAS/KLM cooperation to Australia. MAS could pick key cities in North America namely EWR/JFK, ORD and YYZ to begin with an take it from there for further codeshare expansion. European shorthaul codeshares do not have as much restrictions compared to trans-Atlantic, so MAS should make full use of their cooperation with KLM to serve other key and secondary european cities. MAS's resources should be channelled to the markets that they do best rather than blindly continue operating loss-making routes.

 

I'm wondering how Air France sees all these present/future cooperation between KLM & MAS...

 

AFAIK, SQ metal is still not allowed in YYZ according to the bilateral. My guess is that there is enough SIN-YYZ vv premium traffic to support the SQ/AC codeshare via LHR. If that is true, then the choice of LHR over YVR as a connecting point makes sense as it has fewer stops and avoids the reportedly non-premium AC domestic experience on the YVR-YYZ leg.

 

The SQ/VS transatlantic partnership is also interesting. Perhaps VS is among the most cost effective European majors. It would be great if unit costs for VS and KL on transatlantic operations can be compared. If KL's costs are low enough, the MH/KL transatlantic co-operation that you proposed could happen.

 

I am also thinking about the west coast of U.S.A. and Canada. The reason I think KE is very attractive is that its coverage of North America is extensive (YVR, YYZ, HNL, SEA, SFO, LAX, ORD, DFW, IAD(?), JFK, ATL and just recently announced LAS); these destinations would be reachable with a single transit (ICN) through this one partnership. However, KE's transpacific flight schedules seem a little spread out so the transit times may be less than optimal.

 

As for AF, I guess the AF/KL group is amenable to the maintenance and/or expansion of the MH/KL co-operation. Based on what was reported on the alliance talks, I speculate that AF's position was, "Let's wait and see about SkyTeam membership. Focus on working with KL at AMS. We will be watching the progress on your turnaround plan."

 

 

[HSLim 0]

Just a question, if your proposal is accepted, and MH decides to codeshare with KLM and join SkyTeam, does this justify the need for A380 in MAS? Meaning the A380 to serve several times daily KUL-AMS, KUL-LHR and possibly a KUL-SYD.

 

As far as the AMS station is concerned, the suitability of the current 747 configuration (12P41J306Y) is questionable. KL does not offer first class. If MH follows through on the reconfiguration of its fleet to better match the business:leisure pax ratio, most of its 747s would be two class with a smaller premium cabin translating to 400+ pax or at least 15% increase with existing equipment.

 

Furthermore, if KL launches a CGK nonstop, it could potentially free up a lot of seats for its AMS-KUL leg moreso if the service becomes de-linked from CGK and made into a dedicated KUL service. For example, removing the CGK tag from the current daily AMS-KUL-CGK and using the same equipment could double (100% increase) the seats on KL metal into KUL.

 

If all of that capacity can be absorbed profitably within the next couple of years, then there may be a need for a larger-sized aircraft. Then again it might be just as good for MH to supplement the capacity with extra flights using existing aircraft like the 777. In general, introducing a new aircraft type for only the couple of destinations in the network that can sustain it doesn't make a very convincing case.

[KK Lee 5]

As far as the AMS station is concerned, the suitability of the current 747 configuration (12P41J306Y) is questionable. KL does not offer first class. If MH follows through on the reconfiguration of its fleet to better match the business:leisure pax ratio, most of its 747s would be two class with a smaller premium cabin translating to 400+ pax or at least 15% increase with existing equipment.

 

First class is kept for MH management travel.

 

 

[Sandeep G 1]

First class is kept for MH management travel.

Jangan lupa the politicians and their families as well as the royalities and their families..

 

and with the families come the maids, the drivers, the carers, the accompanying doctors, the family friends - their maids, their drivers, their carers etc etc etc who all occupy business class

[Seth K 3]

Great find Keno.

I see MH still go daily 744 to AMS!

May be good for the company, but my frens always want to avoid KL

[kandiah k 0]

Hey Keno,

 

 

Well said and very true....sometimes we are all so caught up in our dreams and fantasies to see MH fly to a certain destination but what we fail to realise is that we (MW and MH) cannot afford to have these sentiments and make it a reality. After all, it is our national carrier and our national pride, so its better to keep it strong and let it stand high than to compete like a fool and make nothing of it only to loose at the end. I hope MH gains from this new revamping and returns to profitability as soon as possible. Maybe, building and strengthening their foundation first would be ideal.

 

 

 

 

I also support the idea of KL and MH code sharing as mentioned by Keno. It is really a wonder why MH has never thought of it or maybe they have but never put it to action ???!!!

 

I think if MH and KL are doing well on the KUL-AMS-KUL route, they should increase frequency or maybe even capacity (A380).

 

 

Edited June 30, 2006 by kandiah k

[Pieter C. 5]

I'm wondering how Air France sees all these present/future cooperation between KLM & MAS...

 

As long as it will generate $$$'s, AF wouldn't mind KL doing so with MH....basically they're still 2 different airlines operating in 1 holding (AF-KL)...