Malindo expects to break even within two years

Malindo will have 10 new aeroplanes added to the fleet every year as part of plans to own 100 aircraft in 10 years.

PETALING JAYA: Malindo Air, which has been affected by currency fluctuations and rising oil prices, expects to break even within two years, according to CEO Chandran Rama Muthy.

He admitted that Malindo had not been able to produce a positive balance sheet – which he attributed to currency fluctuations and rising oil prices.

“We are still in the growing stage after five years. When you start routes, it is like a tree. It takes a while before you bear flowers or fruit. Around 50-60% of our routes are doing good. We expect to break even in one to two years,” Chandran was quoted as saying in an interview with FlightGlobal.

He said Malindo’s load factors stand at around 75%, with a goal of reaching 80% by year-end. That said, Chandran acknowledged that any full-service carrier would be hard pressed to “get maximum passengers” in a cost-sensitive market.

He did not provide figures on the carrier’s CASK (cost per average seat kilometre) and RASK (revenue per available seat kilometre), but said they have been “on increasing trends”.

Malindo is working to increase its ancillary revenue to cover increasing costs.

It has recently established a loyalty programme called “Malindo Miles”, which has around 500,000 members. By end-2019, it expects to increase membership to two million.

From next month, the carrier will also introduce a new, no-frills fare option. This allows 15kg of luggage instead of the standard 30kg when making a booking; travellers can pay for extra luggage if required.