Malindo goes global

  • Business
  • Thursday, 11 May 2017

Malindo Air

PETALING JAYA: Malindo Air will spread its wings to the Middle East, Europe and Africa. The airline, which has predominantly been operating in Asia since its started operations in March 2013, is working on interline and codeshare arrangements to spread its wings globally.

For starters, Malindo Air is looking at closing a code share arrangement with a Middle East airline, said its chief executive officer Chandran Rama Muthy.

“We are in the final stages of closing a code share deal with a Middle East airline that will give us connectivity to global destinations. Our passengers will be able to book and fly any international destination flown by the airline. And it will be vice-versa for the Middle East airline’s passengers to fly our network,” Chandran said in an interview recently.

The airline, which has now positioned itself as a full-service carrier, is also talking to as many as 30 other airlines for interline arrangements. The codeshare and interline arrangements will allow Malindo Air passengers to travel anywhere around the world.

Malindo Air now offers interlining arrangements to four global carriers – Etihad Airways, Oman Air, Turkish Airlines and Qatar Airways. This interlining arrangement has brought about an 8% increase in traffic for the airline.

“We are talking to many airlines currently and that is why we are confident of getting about ten more interline deals this year from the four we have now.

“By the end of next year, we would have about 30,” he said.

Among the airlines Malindo Air is in talks with to expand interlining arrangements are Thai Airways, Philippine Airlines, All Nippon Airways, Xiamen Airlines and South African Airways.

An interlining arrangement allows a passenger from a flight operated by an airline to transfer into another flight operated by another airline without having to gather the luggage and check-in again.

It differs from a codeshare agreement, which effectively is a business arrangement between two carriers that allows them to cross-sell seats on a single flight operated by one of the airlines.

Interlining was once the domain of Malaysia Airlines, but after the airline got into a deal with Emirates, it had to let go many of its code share and interlining agreements.

Full-service carriers flying into Malaysia and onward to other destinations to Asia needed interlining arrangements and Malindo fitted the bill as it positioned itself from a hybrid airline to a full-service carrier to capitalise on the opportunity.

It also had to move terminals from klia2 to KLIA to enable seamless interlining.

But for Chandran, the ultimate is for code share arrangements.

“With code share, we can sell London, New York, Istanbul, Mexico, Cape Town and other destinations on our network, and similarly, the codeshare partner would be able to sell all our 45 destinations on their network.

“So far, we have seen good traffic numbers with interlining, and with codeshare, the traffic volume will just grow,” he said.

Malindo Air started in 2013 as a hybrid carrier between a low-cost carrier and a full-service carrier and ended the year carrying 900,000 passengers.

Last year, it ended the year carrying 5.6 million passengers, including charter flights, and this year, Chandran is hoping Malindo Air would end the year by carrying eight million passengers.

“We will expand further into North Asia, Australia, India and South-East Asia,” he said. Malindo Air intends to fly into Sydney and Melbourne this year apart from Phnom Penh.

Although there is overcapacity in the Australian routes, Chandran said the feeder traffic from all the destinations that Malindo Air now flies offered enough traffic for onward destinations.

This year, the airline will add more destinations, as it is taking delivery of seven new jets to add to its current fleet of 45 aircraft.

With seven more new aircraft, the airline will be able to offer two million new seats, adding to its existing 11 million seats.

Malindo Air will also be taking delivery of the Boeing 737-Max 8 aircraft next week and it will be the first carrier globally to put the aircraft into commercial service.

“This new aircraft will go into commercial service on May 22, a few days after we take delivery, and the first route it will ply will be KL-Singapore,” Chandran said.

He added that the aircraft was 14% more fuel-efficient, offered 8% lower operating cost than similar planes in the new-generation categories, and would be able to seat 180 passengers.

Malindo Air is 49% owned by Indonesia’s Lion Group that is headed by Rusdi Kirana. Chandran is the predominant local shareholder for the remaining 51% stake that makes the airline majority-owned by Malaysians.


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