Khazanah Nasional’s recovery plan for Malaysia Airlines reaffirms the country’s commitment to the ailing flag carrier, but highlights the carrier's cost and productivity disadvantages relative to its rivals.
Following its initial statement about restructuring
The report’s foreword includes a message from Malaysia's prime minister Najib Razak, where he underlines the importance of the carrier for national development. He also stresses that “for
In addition to adding more detail about the 12-step plan, sections of the report focus on
This slight cost advantage is offset by its RASK of
Against low cost rivals,
This comes against the backdrop of a tough market. The report says airline capacity in Malaysia is growing 10% annually, while demand is growing at just 8%. This, Khazanah believes, will push fares down by 8% over the next five years.
Poor productivity also plagues the carrier.
As such, Khazanah has concluded that the workforce of
Ultimately, Khazanah hopes to reduce
“Cost-competitiveness is the foundation upon which the rest of the business will be built,” says the report. “Resetting the cost structure is particularly important given the Malaysian market context, especially for short-haul travel…there is increasing emphasis on the short-haul business traveller’s preference for efficiency and conveniences versus a premium product, and
Source: Cirium Dashboard