Malaysia Airlines sees turnaround, plans more charter flights from China

“We still have a long way to go but existing and new partners believe in our success and Malaysia Airlines has been set on a path towards reclaiming its position as one of the world’s leading airlines,” said MAS group chief executive officer Cristoph Mueller.

KUALA LUMPUR: Malaysia Airlines Bhd is benefiting from encouraging momentum growth and is achieving sustained progress, the national carrier disclosed in its first quarterly update on Thursday. 

It said among the achievements was an improved on-time performance (OTP) of 89.8% on the day despite major disruptions caused by the recent haze. 

“Revenue per available seat per kilometre has improved year-on-year with seat load factor also showing improvements,” it said. However, no specific figures were mentioned for the two metrics.

“We still have a long way to go but existing and new partners believe in our success and Malaysia Airlines has been set on a path towards reclaiming its position as one of the world’s leading airlines,” said MAS group chief executive officer Christoph Mueller.

Malaysia Airlines also said demand out of China and North Asia was showing a positive trajectory, boosted by increased inbound tourism demand. 

The national carrier had signed an agreement to operate 180 additional charter flights from China to Sabah. It would also introduce more charter flights from selected key cities in China beyond the airline’s network, on top of the existing 180, to meet the increased appetite for inbound tourism. 

The airline’s charter service has seen great success with the Umrah operations ferrying pilgrims to Madinah on its A380-800. This year saw an increase in capacity from 282 seats to 494 per flight on 45 direct flights from Kuala Lumpur to Madinah.

It said greater focus has been given to improving customer service. The quarter saw a new product initiative with the introduction of a premium business class lay-flat seat for the A330-300 fleet. 

The seat marks the beginning of a planned product roll-out of more customer centric, personalised and innovative offerings. 

The fully flat seat will be introduced from April 2016 on all A330-300 aircraft. The conversion will be completed by September 2016. Other new and improved product offerings are in the pipeline, including a new catering concept in all classes and on-board Wi-Fi.

The airline is also focusing on ensuring good corporate governance on a company-wide level. 

Its new group structure will streamline its operations into individual profit centre subsidiaries such as airline, ground handling, cargo, engineering and aircraft ownership.

This will ensure profit and loss accountability which will unlock the value of assets by driving new levels of operational and financial efficiency, the airline said. 

“We are working hard to change the structure of the airline fundamentally, from the inside out. This will involve looking at process, efficiency and tighter cost controls,” Mueller added.

Concurrently, the airline is also disposing its non-core assets for better management focus on its core business.

To promote harmony and constructive dialogue with employees, MAS has created the Malaysia Airlines Work Council to provide a platform for a mutually cooperative relationshiop between management and employee groups.

The airline has also signed a contract to introduce AirPas, a state-of-the-art software system, to maximise cost savings from ground operations and audit accurate billing. AirPas has been successfully used by other world leading airlines and the company is looking at a target saving of up to 20% on ground operations over the next 18 months.

The progress update coincided with MAS clinching a code-sharing agreement with Emirates to expand the airline’s global coverage. 

MAS will add its code Emirates flights to Europe, Middle East, Africa, and the Americas. 

In return, Emirates will add its code on MAS flights to domestic routes in Malaysia, South-East Asia and selective cities across Asia-Pacific.

Additionally, MAS will suspend its Paris and Amsterdam routes from Jan 25, 2016 onwards.

* For additional news on the airline's maiden quarterly report, see Malaysia Airlines to add more crew bases to improve connectivity.

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