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MAB Proposed 25 New Widebody Aircraft Purchase in 2017

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Malaysia Airlines CEO: We'll Be Profitable in 2018

 

Peter Bellew, chief executive officer at Malaysia Airlines, discusses the success of the London-Kuala Lumpur route, the company's restructuring plan and their expansion into China. He speaks to Bloomberg's Haslinda Amin on "Bloomberg Markets." (Source: Bloomberg)

 

http://www.bloomberg.com/news/videos/2016-11-15/malaysia-airlines-ceo-we-ll-be-profitable-in-2018

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Malaysia Airlines Bhd. is considering ordering as many as 25 widebody aircraft as the nation’s flag carrier, recovering from two fatal air crashes in 2014, looks to meet growing travel demand.


The airline will replace 15 of its aging planes and add 10 to fuel growth, Chief Executive Officer Peter Bellew said in an interview in Singapore Tuesday. It may look at Airbus Group SE’s A330s and A350s, and Boeing Co.’s 787s, with a decision due by the middle to end of next year, he said.


“I am short of widebody aircraft,” said Bellew. Besides the current Kuala Lumpur-London flights, “we won’t do other long-haul routes until 2020, 2021 because the aircraft will be available at the right price, at the right time and at the right configuration.”



Bellew, who became Malaysia Air’s third chief executive officer in two years in July, is tasked with the job of restoring confidence in the carrier that lost two planes two years ago -- one that vanished over the Indian Ocean and another that was shot down over Ukraine. The airline is likely to become profitable in 2018 before it relists its shares in the first quarter of the following year, Bellew said.


Fully owned by Khazanah Nasional Bhd. after being taken private in 2014, Malaysia Air has cut long-haul flights and eliminated about 6,000 jobs as part of its restructuring.


After scrapping some European routes, it signed a code-share deal last year with Dubai-based Emirates for longer-haul destinations, eschewing its traditional model of linking Europe and Australia via Southeast Asia. The Asian carrier flies to London from Kuala Lumpur using the Airbus A380s and plans to replace them with A350s in April 2018, Bellew said.


To claw back some of its lost business, Malaysia Air has been offering promotions on its business and economy cabins to lure passengers, Bellew said in a separate interview with Bloomberg Television’s Haslinda Amin. With round-trip tickets between Kuala Lumpur and London for as low as $450, the airline now has a market share of about 60 percent on its London flights, compared with about 45 percent in May, Bellew said.


“The competition is very intense on direct routes to Europe,” Bellew said. “But I think there will be a place in the future for Malaysia Airlines to look at direct long haul services back to Europe.”


Malaysia Air ordered 25 Boeing 737 Max 8 jets, worth $2.75 billion at list price in July with options for 25 more to compete against a slew of budget carriers in the region.


The carrier doesn’t have enough planes to meet the unprecedented opportunity in China, Bellew said. If 12 percent of the mainland Chinese get passports in 10 years, as per a government target, that would translate to 150 million more potential tourists flying to Malaysia, he said.


“The global mega trend in tourism is in China,” Bellew said.



source : http://www.bloomberg.com/news/articles/2016-11-15/malaysia-airlines-mulling-purchase-of-25-widebody-jets-next-year


Edited by Wan

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Wait...The 15 aging aircraft I supposed they are talking about is the current A333 fleet, the oldest is only 5.7 years old. Hardly ageing at all by any standard......

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When is the nearest available slots for the A330neo/A350/787?

Aging because it has something to do with the available slots? By the time the new planes arrived it would be time to move on?

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Stop over analysing adjectives used in such news pieces and you will be fine. In any case, everything is aging over time.

Plus bearing in mind this is the same airline family that is 'replacing' newish ATR72-600s with the -500s that the former were bought to replace - of course we're doing fine :D

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Wait...The 15 aging aircraft I supposed they are talking about is the current A333 fleet, the oldest is only 5.7 years old. Hardly ageing at all by any standard......

Perhaps the leases on some aircraft will expire and MH probably wants to make plans now so that they have replacement aircraft when the time comes.

 

Whatever aircraft they choose, I hope that it is based on the airline's needs and not be a vanity order.

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Malaysia Airlines Bhd. is considering ordering as many as 25 widebody aircraft as the nation’s flag carrier, recovering from two fatal air crashes in 2014, looks to meet growing travel demand.

The airline will replace 15 of its aging planes and add 10 to fuel growth, Chief Executive Officer Peter Bellew said in an interview in Singapore Tuesday. It may look at Airbus Group SE’s A330s and A350s, and Boeing Co.’s 787s, with a decision due by the middle to end of next year, he said.

“I am short of widebody aircraft,” said Bellew. Besides the current Kuala Lumpur-London flights, “we won’t do other long-haul routes until 2020, 2021 because the aircraft will be available at the right price, at the right time and at the right configuration.”

Bellew, who became Malaysia Air’s third chief executive officer in two years in July, is tasked with the job of restoring confidence in the carrier that lost two planes two years ago -- one that vanished over the Indian Ocean and another that was shot down over Ukraine. The airline is likely to become profitable in 2018 before it relists its shares in the first quarter of the following year, Bellew said.

Fully owned by Khazanah Nasional Bhd. after being taken private in 2014, Malaysia Air has cut long-haul flights and eliminated about 6,000 jobs as part of its restructuring.

After scrapping some European routes, it signed a code-share deal last year with Dubai-based Emirates for longer-haul destinations, eschewing its traditional model of linking Europe and Australia via Southeast Asia. The Asian carrier flies to London from Kuala Lumpur using the Airbus A380s and plans to replace them with A350s in April 2018, Bellew said.

To claw back some of its lost business, Malaysia Air has been offering promotions on its business and economy cabins to lure passengers, Bellew said in a separate interview with Bloomberg Television’s Haslinda Amin. With round-trip tickets between Kuala Lumpur and London for as low as $450, the airline now has a market share of about 60 percent on its London flights, compared with about 45 percent in May, Bellew said.

“The competition is very intense on direct routes to Europe,” Bellew said. “But I think there will be a place in the future for Malaysia Airlines to look at direct long haul services back to Europe.”

Malaysia Air ordered 25 Boeing 737 Max 8 jets, worth $2.75 billion at list price in July with options for 25 more to compete against a slew of budget carriers in the region.

The carrier doesn’t have enough planes to meet the unprecedented opportunity in China, Bellew said. If 12 percent of the mainland Chinese get passports in 10 years, as per a government target, that would translate to 150 million more potential tourists flying to Malaysia, he said.

“The global mega trend in tourism is in China,” Bellew said.

source : http://www.bloomberg.com/news/articles/2016-11-15/malaysia-airlines-mulling-purchase-of-25-widebody-jets-next-year

 

MH currently uses the A330-300 for its Asian regional routes, so any replacement for them would be expected to fly the same routes. For the next few years, they are planning to focus on the China market - these are relatively short to medium range destinations. The A330-900 should be sufficient to cover all these routes.
Capex will not be as huge as that required for the A350/B787 - something that will weigh heavily on the MAB management. When they decide to return to Europe, they could then decide if they want to get more A350-900s or reconfigure the A330-900s for long haul.

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31094996431_bd07d39ef9_c.jpg
Malaysia Airlines is considering placing an order for 25 A330neos or 787s in 2017. The order includes 15 replacements for its existing A330ceo fleet and also 10 growth aircraft – which will be used to pursue expansion opportunities in North Asia and potentially support a resumption of services to continental Europe.
Malaysia Airlines is also considering adjustments to its narrowbody fleet plan. A slight reduction in the size of its 737-800 fleet is likely as utilisation improvements have meant that the airline needs fewer aircraft. A portion of the remaining fleet will be reconfigured, with some 737s receiving new business class seats and some 737s potentially becoming all-economy aircraft.
The group is also assessing the possible addition of 737s at the regional subsidiary MASwings to support expansion on international routes from east Malaysia. MASwings currently only operates turboprops.

  • Malaysia Airlines fleet now consists of only 78 aircraft
  • New widebody order to include 15 replacements and 10 growth aircraft
  • Malaysia Airlines could add back European destinations as widebody fleet expands
  • The 787-9 is the frontrunner in the new campaign
  • Malaysia-US flights are unlikely for now
  • Short term focus for expansion is North Asia
  • Malaysia Airlines may reduce 737 fleet in 2017
  • Malaysia Airlines has flexibility to return excess 737-800s
  • Malaysia Airlines plans to install new business class seats on a portion of 737 fleet
  • Malaysia Airlines may use some all-economy 737s for China routes
  • Regional subsidiary MASwings may add 737s
  • Malaysia Airlines will expand, but cautiously

 

Full report behind paywall:

http://centreforaviation.com/analysis/malaysia-airlines-update-part-3-new-widebody-order-designed-to-support-long-term-growth-314983

Edited by flee

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If it were between the two, yes I agree completely.

 

However hope that they can stick to the A359, with eventual possibility of A35K when they are ready to expand.

 

Till today I'm bummed that MH did not take the 77W when they were ready to expand when they already had the 77E...

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If it were between the two, yes I agree completely.

 

However hope that they can stick to the A359, with eventual possibility of A35K when they are ready to expand.

 

Till today I'm bummed that MH did not take the 77W when they were ready to expand when they already had the 77E...

Because they were committed to the A380 already, even though the 77W was the right plane then.

 

Rather perplexing that the A359 isn't considered. I thought the 359 is the 789 equivalent no?

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Rather perplexing that the A359 isn't considered. I thought the 359 is the 789 equivalent no?

I would take these media reports with a grain of salt though. Yes, if you look at SQ, they are only going to operate the A359 with B787-10. This is because the B787-8 is too small and the B787-9 is too close to the A359. Fortunately, they can send those to Scoot.

Till today I'm bummed that MH did not take the 77W when they were ready to expand when they already had the 77E...

Prime example of government interference in the affairs of the airline...

PM's ego demanded MH must operate the A380 just because SQ has ordered them.

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I would take these media reports with a grain of salt though.

 

 

 

 

Prime example of government interference in the affairs of the airline...

PM's ego demanded MH must operate the A380 just because SQ has ordered them.

 

 

Hm....

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Until mab has a fleet mix that could maximize yield and synchronize schedule, doubt it's competitors will take it seriously. Also mean, taxpayers will continue to fork out $ for btp and bottomless holes.

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its a very cramped in Y class

Yes, in 3-3-3 configuration it is. But in low density configurations like ANA's, it is much better!

I suspect that if MH orders it, the Y cabin will be 3-3-3.

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its a very cramped in Y class

 

Having flown 787 in a 3-3-3 configuration, it is very cramped - somehow it feels worse than the 3-4-3 configuration of 777 and D7's 3-3-3 in A330. I don't think I want to take 787 long haul.

 

Having said all this, I have to contend that the future of Y class will be LCC-ish. What to do - cannot afford the front cabin ....

 

 

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Doubt mab will be getting the b787 though im rooting for it. Commonality transition between the a380 and a330 and upcoming a350 is already there, it could save them a lot of money if they get the a330neo.

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Doubt mab will be getting the b787 though im rooting for it. Commonality transition between the a380 and a330 and upcoming a350 is already there, it could save them a lot of money if they get the a330neo.

I tend to agree - I believe that Boeing is kept in the bid to ensure that Airbus gives them a competitive price for the A350/A330Neo.

 

A small airline like MAB should try to keep their fleet simple to reduce operating costs. There is also the safety aspect too - fewer aircraft types also mean that employees are not distracted by so many issues on each type. KISS principle applies!

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