Extracts from Malaysiakini
Five-star airline with budget carrier fares
Oct 29, 07 7:29am :
Malaysia Airlines plans to transform itself into a five-star airline with budget carrier fares, under a five-year business transformation plan to be launched in 2008, a report said Monday.
The beleaguered flag carrier last year launched a turnaround plan aimed at restoring it to profitability after a series of losses.
Its managing director, Idris Jala, said the airline now wanted to shift gears again, with a five-year transformation plan aimed at making it more nimble to face heightened competition.
"We were talking a lot about business turnaround plan before. Now we plan to transform from what we are today into a five-star airline at low-cost carrier cost," he told the state news agency Bernama.
DeanKuok Says:
5 Star Service at Budget Prices
The last few days, I was so disappointed by the ‘feel tall’ and “don’t feel tall” argument about our cosmonaut. Say what you like but at this point of time, this is simply just another “Malaysia Boleh” waste of RM90 million public funded space tour by a lucky Malaysian first space tourist. Now…hold your horses! I am proud of Sheikh Mustaphar as a Malaysian capable of travelling to space but the Government of Malaysia packaging the space odyssey as a scientific research appalls me. Now, that is an unacceptable load of rubbish! I shall wait for the government of Malaysia and those that disagree with me another 20 years to prove me wrong and I sincerely hope I am wrong.
Still on the air space issue, DIJ announced that Malaysia Airlines plans to transform itself into a five-star airline with budget carrier fares. Bravo… MAS footing is definitely firmly on the ground instead of floating in Space! Definitely this new proposed strategy make excellent good economic sense.
Let us all pause for a moment and look at MAS current position. On their left are the fast growing regional budget airlines and on their right, the much established exclusive 5 star Singapore Airlines. Budget airlines offer cheaper prices at the expense of comfort while exclusive airlines offer slightly better comfort at hefty prices. I always wonder why can’t we have both? Competitively priced and comfortable air travel. Airlines experts will declare this as impossible but Stelios (easyjet) have always proved his critic wrong by seeking non-airlines financial experts because they are the only ones who can tell him how easyjet can fly from London to Paris at the price of a steak and still make profits. The basic principal is that airplanes belong up in the sky carrying the maximum load and not left idling on the tarmac. The secret is not just saving cost by not assigning seats. How much can the airline really save by not assigning seats, when one can now select the seat via the Internet? The bottom line is still “effective lower per passenger unit cost” by maximising passenger load and the time the plane remain in the sky (“airtime”) where they ought to be.
If I am to assume this as MAS new strategy, then we are looking at comfortable mass transit at very competitive prices. Excellent strategy assuming that MAS is able to control the unit cost effectively. This strategy is certainly an effective way to capture a larger share of the international travellers market. We should not be protecting the 25 million passengers but instead targeting 50 million passengers. This will mean truly able transforming KLIA a competitive regional hub and boasting the other related industries such as higher returns for KLIA, airline support industries, tourism and regional business centre. I will certainly look forward to MAS new strategy.
Monday, October 29, 2007
Saturday, October 27, 2007
Now We Can Fly Higher
Malaysiakini Report:
MAS 'disappointed' over end of KL-S'pore monopoly
Oct 26, 07 3:44am
Malaysia Airlines said today it was disappointed over the decision to allow budget airlines to operate the lucrative Kuala Lumpur-Singapore route, breaking the national carriers' stranglehold.
"Whilst we are all for fair competition and we believe in the concept of open skies, we are disappointed that the Kuala Lumpur-Singapore route will be prematurely opened to limited flights," CEO Idris Jala said in a statement.
Malaysian Prime Minister Abdullah Ahmad Badawi said yesterday that pioneering low-cost carrier AirAsia had won its long battle to operate the route which for 35 years has been monopolised by Malaysia Airlines and Singapore Airlines.
BirdTalk comment:
Way to Fly Higher
I applaud the decision by the cabinet to loosen the stranglehold of MAS and Singapore airlines for KL-Singapore sector. Both MAS and Singapore airlines have benefited from this monopoly for too long and I am sure regular travellers who have being paying astronomical rates for the 30 minutes ride would more than welcome this decision. However, I urge the government of Malaysia to opening this sector altogether instead of limiting it to just 2 flights per day.
Over the years, Sepang has lost out significantly to Singapore Changi as the regional airline hub. Most travellers have chosen Changi as the preferred destination and transit point due to the ease of flight connection and the lure of Changi airport as a shopping and leisure complex instead of just an airport. Annually, Changi airport handles over 35 million passengers/200,000 flights serviced by over 80 airlines catering for 185cities/58 countries of which more than 60% are transit passengers. On the other hand, KLIA handles 25 million passengers/180,000 flights serviced by about 40 airlines with more than half of KLIA flights and passengers are domestic and less than 20% transit passengers.
The government of Malaysia should not be focusing on protecting on what we have but instead of the opportunity available in capturing a larger share of the international travellers market. We should not be protecting the 25 million passengers, least of all, our under-performing national carrier or our booming “Asian” carrier Air Asia, but instead targeting 50 million passengers for the prosperity of our National carrier, Budget Airlines, KLIA, airline support industries, tourism and regional business hub. This growth can be achieved if KLIA can offer international travellers better reasons why KLIA should be the preferred regional destination or transit point. We can start by offering the basic pre-requisite most travellers seek, the basic convenience of flight connections and competitive incidental cost. This would certainly a worthwhile consideration for most travellers to re-evaluate their options. More travellers’ preference to use KLIA means more passenger loads, more airlines, more destinations and country covered.
If the government of Malaysia intend to establish KLIA as a truly international and domestic air travel hub, then the government ought to seriously be capitalising on the booming regional budget airline industry. This can only be achieved if the government subscribe to total open sky policy and provide more attractive incentives, support and facilities for more budget airlines to be based in KLIA. With more budget airlines servicing the region, local and international traffic will increase. Therefore, in retrospective, removing protective measures such as protecting lucrative routes or granting more licences for more budget airline will indirectly lead to greater prosperity of our national carrier airlines, the budget airline industry, KLIA, airline support industries, tourism and business regional hub.
Malaysia Airlines should not be disappointed over the decision to allow budget airlines to operate the lucrative Kuala Lumpur-Singapore route, breaking the national carriers' stranglehold. Instead, MAS should capitalise on the opportunity by re-focusing its business strategy to be an exclusive national carrier and re-directing its resources to attract more international travellers flying to or via KLIA. Over 3 decades of protectionism is already excessive. The government should not forgo it’s aspiration by continue to provide any form of protection for the national carrier and local budget airline Air-Asia. Instead, it should all be removed immediately for the future of the country as a whole.
MAS 'disappointed' over end of KL-S'pore monopoly
Oct 26, 07 3:44am
Malaysia Airlines said today it was disappointed over the decision to allow budget airlines to operate the lucrative Kuala Lumpur-Singapore route, breaking the national carriers' stranglehold.
"Whilst we are all for fair competition and we believe in the concept of open skies, we are disappointed that the Kuala Lumpur-Singapore route will be prematurely opened to limited flights," CEO Idris Jala said in a statement.
Malaysian Prime Minister Abdullah Ahmad Badawi said yesterday that pioneering low-cost carrier AirAsia had won its long battle to operate the route which for 35 years has been monopolised by Malaysia Airlines and Singapore Airlines.
BirdTalk comment:
Way to Fly Higher
I applaud the decision by the cabinet to loosen the stranglehold of MAS and Singapore airlines for KL-Singapore sector. Both MAS and Singapore airlines have benefited from this monopoly for too long and I am sure regular travellers who have being paying astronomical rates for the 30 minutes ride would more than welcome this decision. However, I urge the government of Malaysia to opening this sector altogether instead of limiting it to just 2 flights per day.
Over the years, Sepang has lost out significantly to Singapore Changi as the regional airline hub. Most travellers have chosen Changi as the preferred destination and transit point due to the ease of flight connection and the lure of Changi airport as a shopping and leisure complex instead of just an airport. Annually, Changi airport handles over 35 million passengers/200,000 flights serviced by over 80 airlines catering for 185cities/58 countries of which more than 60% are transit passengers. On the other hand, KLIA handles 25 million passengers/180,000 flights serviced by about 40 airlines with more than half of KLIA flights and passengers are domestic and less than 20% transit passengers.
The government of Malaysia should not be focusing on protecting on what we have but instead of the opportunity available in capturing a larger share of the international travellers market. We should not be protecting the 25 million passengers, least of all, our under-performing national carrier or our booming “Asian” carrier Air Asia, but instead targeting 50 million passengers for the prosperity of our National carrier, Budget Airlines, KLIA, airline support industries, tourism and regional business hub. This growth can be achieved if KLIA can offer international travellers better reasons why KLIA should be the preferred regional destination or transit point. We can start by offering the basic pre-requisite most travellers seek, the basic convenience of flight connections and competitive incidental cost. This would certainly a worthwhile consideration for most travellers to re-evaluate their options. More travellers’ preference to use KLIA means more passenger loads, more airlines, more destinations and country covered.
If the government of Malaysia intend to establish KLIA as a truly international and domestic air travel hub, then the government ought to seriously be capitalising on the booming regional budget airline industry. This can only be achieved if the government subscribe to total open sky policy and provide more attractive incentives, support and facilities for more budget airlines to be based in KLIA. With more budget airlines servicing the region, local and international traffic will increase. Therefore, in retrospective, removing protective measures such as protecting lucrative routes or granting more licences for more budget airline will indirectly lead to greater prosperity of our national carrier airlines, the budget airline industry, KLIA, airline support industries, tourism and business regional hub.
Malaysia Airlines should not be disappointed over the decision to allow budget airlines to operate the lucrative Kuala Lumpur-Singapore route, breaking the national carriers' stranglehold. Instead, MAS should capitalise on the opportunity by re-focusing its business strategy to be an exclusive national carrier and re-directing its resources to attract more international travellers flying to or via KLIA. Over 3 decades of protectionism is already excessive. The government should not forgo it’s aspiration by continue to provide any form of protection for the national carrier and local budget airline Air-Asia. Instead, it should all be removed immediately for the future of the country as a whole.
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