KUALA LUMPUR: Malaysia Aviation Group (MAG) is banking on its Long Term Business Plan 2.0 to break even its finances and turn cash flow positive by 2023 in what it calls a “downside scenario”.
Group chief executive officer Capt Izham Ismail said if the market turns around faster, they would break even much earlier.
“The trajectory that we are looking at is an extended L-shaped recovery so very likely, it’s (the recovery) in 2023.
“I hope it doesn’t go south from there.
“In most airlines, we’re pulling all levers and we’re hopeful the market will recover, ” he told a virtual media briefing on MAG’s business update earlier today.
MAG is the parent company of Malaysia Airlines.
Izham said there are three key objectives on the group’s financials, first which is to restructure its balance sheet, turnaround its profit or loss and cash flow stability.
The group is also planning to retire its entire fleet of Airbus A380 airliners in the upcoming months as the superjumbos do not fit the group’s future plans.
Izham said the management is putting up a paper to the board of directors for approval soon, with a recommendation to the shareholders and the board to exit Airbus A380.
“We are currently exploring ways of disposing the aircraft.
“We are cognisant of the challenges of selling this plane but we are still looking at ways to dispose our A380 fleet.
“At the moment, management is convinced that the A380 doesn’t fit the future plan, ” he said, adding that an official announcement will be made soon once the approval is obtained.
MAG currently has six A380s under Malaysia Airlines.
Izham said MAG is cognisant that its wide bodies will need to be refreshed and there will be a campaign that will be induced by 2023 or 2024 which will be a combination of mid range, long haul and super long haul aircrafts.
Meanwhile, MAG is also committed to taking delivery of 25 Boeing 737 Max aeroplanes starting 2024, as part of its amiable agreement with Boeing, which is one of its creditors.
“We are exploring the possibility of taking the aircraft earlier and I hope all the issues involving the 737 Max will be resolved by then.
“I hope consumer confidence will come back into play in the technology, ” he said.
The Boeing 737 Max was grounded for 20 months until December 2020 by aviation authorities globally after two crashes claimed 346 lives.
The flight control system of the 737 Max was blamed for the crashes.