Throughout my journey from being a banker, to now a journalist, I have always consciously avoided writing about, or presenting on, this bittersweet story of a Malaysian corporate. The reason of this avoidance is a sentimental one. My good friend lost her husband in MH17. He was in fact the First Officer of that flight. A relative twice removed perished in MH370. My first flight ever was on an MH. And my first international destination (other than Singapore but that doesn’t count because I’m a Johorean after all) was to London. On the effervescent MH 1.
But the time has come for me to deal with Malaysia Airlines head on. I have ignored this topic long enough.
I am returning from visiting the Airbus’ Final Assembly Line in Toulouse, France. There, I was with about ten other Malaysian journalists, and at the end of the trip, even Peter Bellew, the Chief Executive Officer (CEO) of Malaysia Airlines joined us as well.
The airlines have been accused by many quarters of the mismanagement of the company. Accusers like to point out that these ‘invisible hands’ direct the company to a point where its difficult for the management to make the right decisions. As a journalist, it is hard for me to prove something that is invisible. I’ll try the easier option, which is to look at the quantitative results the company has made, and assess its sustainability on that trajectory by looking at their plans.
Fleet size
Peter Bellew declared in the Airbus plant in Toulouse that “Malaysia Airlines’ fleet size is right for its operations”. Currently, the airline has 54 aircraft in its fleet of 737-800, where 48 is operating and six to be handed back to lessors by December 2017. The 48 operating aircraft will start to reach end of lease from early 2019. A new plan is needed to manage these short term routes.
Then-CEO Christophe Muller then led the team to place 25 orders of the 737-MAX8 aircraft. He tied in this purchase with 25 as options. The airline stated via a statement in September that this particular purchase was to replace existing planes, where they say that they are due for replacement beginning 2019 as stated above.
In June 2017, in tandem with Prime Minister Datuk Seri Najib Razak’s visit to the White House, MAS entered into a new agreement with Boeing to choose 10 units of Boeing’s larger 737-MAX10 aircraft out of the previous order of 25 units of the 737-MAX8. This gives the airline flexibility to go for the MAX8 or MAX10 variations.
This would be the staple of their fleet.
But the cavalry of the MAS fleet is the A380. They have 6 of them. And it is (almost) exclusively used to service their London-KL route. Why I say almost is because during the Hajj period, the A380 is used as a chartered plane to shuttle Hajj pilgrims to Saudi Arabia.
The seating capacity of the A380 is 480 seats. When the airline took the aircraft in 2012, they went with the assumption that this most lucrative route is going to be a staple for their international offering. But the twin tragedies that befell on Malaysia Airlines, the MH17 and MH370, took the winds from their sails. Consumer confidence, particularly in Europe, after MH17 resulted in very low yields from this route. They can’t fill 500 seats every single time they leave KLIA for Heathrow. And they don’t fare any better on the return trip either.
To stem this, then-CEO Christoph Mueller decided to go with buying the new A350s to replace the A380s instead for the London route.
Save London
Before we jump onto explaining the A350 deal, we have to understand why MAS needs to save the London route. To answer this is to look at the historical ties of both Malaysia and Great Britain. It is not just the legacy of colonialism that stands between Kuala Lumpur and London.
It is also a rich history of how leaders of Malaysia, both corporate and political, were trained and educated in England. PM Najib, all his brothers, Tony Fernandes, half of the Khazanah board members, and more, much much more, were schooled in English schools.
Their children either are or is still being educated in universities and boarding schools of England and Wales, and Scotland.
Malaysian companies have sizeable investment in the United Kingdom. The Battersea project, FGV hotels, and more are meant to drive investments into the UK. And – courtesy of Brexit – at a time when the global economic community, led by the European Union, are shying away from investing in the British Isles, Malaysian firms do not want to conform to this trend and continues to invest heavily in the UK.
KWAP and EPF, the two powerhouses of pension funds too are big investors in the UK.
In short, Malaysians loves the UK. And to a lot of extent, this love is indeed reciprocative.
The British ambassador to Malaysia, Vicky Treadell, has been quoted before saying that “the Brits really love Malaysia. The people, the food, the warmth, the language, the culture, and the history, all points to a very lasting relationship between our two nations”.
In short, Malaysia Airlines does have an inherent need to not just keep the London-KL route alive and well, but some would say they have a duty to do so. Failure is not an option for this route. So much importance have been placed on this route that even their numbering code, the first four of the MH brand, is dedicated to this route.
The A-350
Now that we’ve gotten that out of the way, let’s talk about the vessels that will bring Malaysians to London. MH 1 to 4 was always served by the most pristine beasts of the Malaysia Airlines’ fleet. It used to be the 747-400s. These were the ones I flew in when I took my first trip to the Big Ben. At the time, the “seven fours” as the crew likes to say was the biggest commercial airliner in the world. And the most popular.
It was of course a natural progression when the heir to the 747s was the newly created ‘biggest commercial airliner’ in town right now. The Airbus A380. Majestic beasts that flies like an ocean liner. The very one I am on right now while writing this piece. At that point in time, in 2012, no one could see the downside (or is it refusing to see the downside?) of Malaysia Airlines buying six A380s to service London and other key destinations in Europe.
But tragedy struck. Not once, but twice. And so filling 500 bums one way was a tough sell.
2014 recovery plan
The so-called 5 year recovery plan that was hatched by the good folks at Khazanah and other players showed that tough decisions had to be made in order to save the airline. This includes retrenching thousands of cabin crews, on-ground staff, flight crew and more. And for those who did stay on to serve the airline, cuts on benefits and pay followed closely. A rebranding was heavily discussed. But they settled for a change in entity name instead. Today, officially they are known as Malaysia Airlines Berhad, or MAB.
But for me, the biggest decision the company had to take, was to replace the A380s with a smaller, more efficient, aircraft. All to serve the MH 1, MH2, MH3, and MH 4 route.
And they went with the A350-XWB jets, made by the same folks who crafted the A380s, and the A330s. The latter of course is heavily operated by Malaysia Airlines. Currently they have 15 units of the A330s. With the decision to buy the A350s, it was a blessing in disguise for the crew of Malaysia Airlines.
Between the A330s and the A350s, Airbus likes to same that they behave in the same ‘commonality’ and are in the ‘same family’. What Airbus means is that between the A330 and the A350, they are 95 percent similar in how they operate. A pilot with a license to fly the A330 would automatically be able to fly the A350. Cabin crew operating on the A330 would feel seamless in operating the galleys of the A350.
I witnessed with my own eyes at the mock up area of the Airbus plant facility of the differences (or lack thereof) between the galley insets of the A330s and the A350s.
So while the big bosses of the company decide to do what is necessary for the company, at the very very least, the staff of Malaysia Airlines, the very people who have dedicated their careers, livelihood, and tragically for some, their lives, should have no trouble moving in to the new aircraft to service the emblematic MH 1 route.
A story that all Malaysians should hope for
I hate to sound sappy, but the success of Malaysia Airlines must be rejoiced by all Malaysians. I stood dewey eyed from the glass windows of the old Subang airport. Looking at the majestic beasts of the 747s. I was ten when I flew in it. I got the goody bag that any ten year old would love.
Today, in my mid thirties, I am flying in its successor. The A380. I stood at Heathrow airport thinking that this is not just another routine flight back home from London. This is probably one of the last times I can fly in an A380 with Malaysia Airlines. I still stood in awe and amazement at the aircraft, and served by the most lovely crew any traveler could wish for.
I hope that my kids would stand in wonder, when I bring them to KLIA to ride on the magnificent A350s, holding their boarding passes with them with MH 1 on the pass. Or MH 2, MH 3, or MH 4.
As Peter Bellew told me at the nose of the third of the six A350 currently being manufactured in Toulouse, “this is a story of recovery. A story of healing, and a story of an awakening. This is the story of Malaysian Hospitality”.
If an Irishman loves Malaysia for the promise that the nation bears, I hope that my fellow Malaysians could see beyond the politics and noise, and to celebrate with the proud Irishman, or how great Malaysia Airlines is, and what we can do to make it better.
Like writing an article on Malaysia Airlines for the first time in his journalistic career. For example.
* The writer is Astro AWANI's Business Desk Editor.
** The views and opinions expressed in this article are those of the author(s) and do not necessarily reflect the position of Astro AWANI
