Malaysia Airlines could break even by 2018 : CEO

Updated - April 22, 2016 01:32 am IST

Published - June 01, 2015 04:41 pm IST

The new CEO of Malaysia Airlines said the ailing carrier could break even by 2018 after cutting staff, selling surplus aircraft and refurbishing its international fleet.

Christoph Mueller said on Monday that the airline is trying to sell two of its A380 super jumbo jets and has gone ahead with its previously >announced plan to cut 6,000 of its 20,000 staff .

The remaining 14,000 employees have been offered jobs in a new company that is being set up to take over the legacy Malaysia Airlines business.

The former chief executive of Ireland’s Aer Lingus told a press conference that Malaysia Airlines is “technically bankrupt” but can remerge as Southeast Asia’s leading airline.

It is being kept alive by an injection of funds from a Malaysian government sovereign wealth fund after double disasters in 2014 dealt a fatal blow to its already struggling business. The Malaysian parliament passed a law allowing the airline to be restructured under Chapter 11-style bankruptcy protection.

Malaysia Airlines had a good safety and service record before last year’s disasters but the tragedies, and the airline’s handling of the first one in particular, battered its brand. >Malaysia Airlines Flight 370 with 239 people on board went missing March 8 last year while en route to Beijing and no trace of it has been found. In July, a Malaysia Airlines jet was shot down over Ukraine, killing all 298 people on board.

Mueller, who started work at Malaysia Airlines on May 1, said the restructuring is a “hard reset” for the airline that will reduce its costs by 20 percent and give it an opportunity to grow again.

Mueller said two of the airline’s six A380 jets are surplus to requirements and will be sold, reflecting significant changes in the airline industry since the big jets were introduced, including the rapid expansion of Emirates, which have resulted in overcapacity.

Its Boeing 777 and Airbus A330 jets will be refurbished and reconfigured as two—class planes with the business cabin to offer larger lie-flat seats than other airlines.

A few international routes may be cut, Mueller said, but the airline’s approach would mainly turn on flying smaller aircraft on routes that are currently unprofitable.

0 / 0
Sign in to unlock member-only benefits!
  • Access 10 free stories every month
  • Save stories to read later
  • Access to comment on every story
  • Sign-up/manage your newsletter subscriptions with a single click
  • Get notified by email for early access to discounts & offers on our products
Sign in


Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.

We have migrated to a new commenting platform. If you are already a registered user of The Hindu and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.