KUALA LUMPUR: The issue of Malaysia Airlines Bhd’s turnaround and its return to profitability is not something new.
It has long been a big question mark among the domestic and international aviation industry, not to mention the pessimism and disgust on whether the country’s national carrier “could return to profitability”.
Recently, AirAsia Bhd Group co-founder Datuk Pahamin Ab Rajab has expressed a desire to “save” Malaysia Airlines with a proposed take over which has been submitted to the Prime Minister Tun Dr Mahathir Mohamad.
Pahamin’s effort with five unnamed entrepreneurs was not based on any commercial considerations, but rather on his strong love for the country, where he also made a commitment not to slash any jobs if his effort in taking over MAS succeded.
To recap, Australia’s national carrier, Qantas Airlines Ltd had also planned to acquire Malaysia Airlines a decade ago, but its bid failed following pressure by the union (MAS Union).
Low-cost carrier, AirAsia too came close to forging a share-swap agreement with Malaysia Airlines in 2011, but crisis and internal interference from the airlines are said to be the cause behind the agreement’s failed takeoff.
The question on everyone’s mind right now is, when will the issue of Malaysia Airlines’ takeover reach its conclusion?
According to veteran journalist Datuk A. Kadir Jasin, the government can no longer wait because the issue of Malaysia Airlines’ turnaround and its recovery have long been delayed, with no signs of progress.
He praised the interest and proposals from within the country to help lift the dignity of Malaysia Airlines and nurse it back to health.
“The Government and Khazanah will definitely review all the proposals on their merits.
“Foreign and domestic proposer can combine, as efforts to restore Malaysia Airlines needs various expertise, experience as well as large capital,” he proposed.
Malaysia Airlines was fully taken over by Khazanah Nasional Bhd which emerged as the carrier’s largest shareholder in 2014, even though the country’s sovereign wealth fund already held 70% of the airline’s shares.
Like an astrologer, Mahathir at that time predicted that the airline’s 100% ownership by Khazanah would not be much different from 70% ownership.
He was puzzled by the airline’s privatization move, because Khazanah is a government-owned company, asking whether “is it called privatization or nationalization?”
Despite becoming a privately-owned company with four recovery initiatives costing almost RM25 billion, the hope to see the recovery of Malaysia Airlines still looks bleak.
Several market analysts suggested that it is better to sell or even close the airline, rather than watching MAS continue to bleed.
In tandem with that suggestions, Mahathir said the government was considering the move after MAS kept registering losses due to several factors including the shortage of crew in the second half of 2018.
The prime minister has made it clear that the government can no longer afford to fund the airline.
Meanwhile, Bank Islam Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the airline industries are expected to witness strong demand going forward.
Therefore, Malaysia Airlines he said, needs to carefully plan their capital expenditure requirements, while at the same time becoming cost-competitive.
The national carrier according to him, also need a robust hedging strategy, due to the volatility in the jet fuel prices.
He said it is worthwhile for Malaysia Airlines to consider the offer made by Pahamin and partners to take over, if they could turnaround and add value to the airline.
“Operational efficiencies are critical to Malaysia Airlines especially in the context of leveraging the technologies that will improve the passenger experience.
“Not to mention managing staff morale as the previous rationalization exercise saw a huge number of job cuts.
“This is also important as human resources are one of the critical success factors especially when dealing with passenger,” he said.
Pahamin reportedly said if their proposal to turn the ailing airline around received the go-ahead from the government, there would be no job cuts, intact national branding and no loans or guarantees from the government.
The proposal was offered through their vehicle, Najah Air Sdn Bhd.
This is a proposal worth seriously considering since it comes from people who have run a low-cost airline successfully.
Putting Malaysia Airlines on the path to profitability expeditiously must be the priority.
There is no need to succumb to pressure from vested interest groups, which only wanted to undermine genuine market-driven initiatives to resuscitate Malaysia Airlines. — Bernama
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