Malaysia Airlines Turnaround Plan 2011/2012

Malaysia Airlines (MAS) cut as many as 12% of their routes in order to cut operation costs. I think MAS can maintain their Kuala Lumpur - Rome route with twice weekly instead trice weekly. Singapore Airlines (SIA) operate Singapore - Rome twice weekly with 777-300 but with a better products offering compared with MAS.

Furthermore, MAS should think to replace the existing aircraft which have high in maintenance costs and high fuel consumption. Malaysia Airlines should buy at least 3 Boeing 747-8 which will be used to Amsterdam, Sydney, Tokyo and New Delhi routes together with 6 A380s that will be operated to London, Amsterdam and Sydney routes. As far as I can see Kuala Lumpur to Los Angeles via Taipei has shown good load factor and almost 100% load factor. Maybe MAS should think to increase to 4 times weekly instead of 3 times weekly.

The existing aircraft should refurbish in line with other airlines starting with MAS' Boeing 777-200 as a kick start for turnaround plan. Based on survey I conducted, most of the people fly with other airlines because of in-flight services or products.

My suggestion:
4x A380 use in London route
1x A380 and 1x 747-8 use in Amsterdam route
1x A380 and 1x 747-8 use in Sydney route
1x 747-8 use in Tokyo and Delhi

Proton New Engine (Campro 1.6 CFE)

Proton need to produce new replacement model frequently in order to attract the customers. The current models are really outdated. For example, Proton should already replace Proton Perdana V6. There is no new model to replace the Perdana V6. Furthermore, Perdana V6 no longer in production.

However they manage to produce all new engine called Campro 1.6 Charge Fuel Efficiency (CFE) which is a good steps for Proton. The performance specs for the CFE mill are 140 PS (or 138 hp) at 5,000 rpm and 205 Nm at 2,000 to 4,000 rpm The new engine able to compete against the CPS as well as two competitors, the Nissan Grand Livina 1.8 and Toyota Innova 2.0L. The new engine will be equipped in new Proton Exora Bold model. This new Proton Exora Bold able to kicks out Nissan Grand Livina 1.8L and Toyota Innova 2.0L.

Click here for more informations about the new engine.

New Proton Exora Bold model

Malaysia Airlines Axes 8 routes

Malaysia Airlines has embarked on a significant route rationalisation as part of its restructuring plan to stem its losses anticipated this year and in 2012.

The route rationalisation involves the withdrawal from the following loss-making routes:
Effective 6 January 2012: Daily flights Kuala Lumpur – Surabaya B737.
Effective 10 January 2012: Thrice-weekly Kuala Lumpur – Dubai A330.
Effective 12 January 2012: Twice-weekly Kuala Lumpur – Karachi – Dubai A330.
Effective 13 January 2012: Twice-weekly Kuala Lumpur – Dubai – Damman A330.
Effective 30 January 2012: Daily Langkawi – Penang – Singapore B737.
Effective 31 January 2012: Thrice-weekly Kuala Lumpur – Johannesburg B777.
Effective 1 February 2012: Twice-weekly Kuala Lumpur – Cape Town – Buenos Aires B747.
Effective 2 February 2012: Thrice-weekly Kuala Lumpur – Rome B777.

“The withdrawal was based on our own independent internal profitability and yield analysis," said Malaysia Airlines’ Group CEO Ahmad Jauhari Yahya. However Malaysia Airlines will start operating back to these routes when the business is stable.

For my point of view, Malaysian able to attract customers if they refurbish their fleets for a better looks and new products offering. Currently Malaysia Airlines products quality are shrinking and left behind by other mainstream airlines such as Singapore Airlines, Emirates and Qatar Airways.

MAS will stop flying to Argentina & South Africa

In order to cut costs, Malaysia national carrier, Malaysia Airlines (MAS) will stop flying to Johannersburg and Cape Town in South Africa and Buenos Aires in Argentina starting early next year. I heard from one of the employees of MAS told me that the load factor is good but the yield is bad due to lack of premium customers, Business Class and First Class. The reasons they are not flying with MAS because the products are outdated. Other carriers such as Emirates, Qatar Airways and Singapore Airlines which flies to that particular routes and offers full flat bed with the seats arrangement of 1-2-1 on business class makes the passenger feel so comfortable to fly them. In closer, MAS business class is angle lie flat bed with the seats arrangement of 2-3-2 which is pack and outdated. Besides that, MAS also faced another problem with some restrictions on their flights which they are not allow to pick passengers from Cape Town to Buenos Aires. Maybe MAS should transit with other cities instead Cape Town which don't have any restrictions on flights or working with government of Malaysia to sign bilateral agreement with government of South Africa for open skies.

Besides that, MAS will reduce flights to Dubai in stages until they operate twice weekly due to load factor problem. They will also stop flying to Damman which transit in Dubai. In closer, Emirates, the national carrier of UAE offers 17 flights weekly from Dubai to Kuala Lumpur and even operate the world's biggest aircraft to Kuala Lumpur on certain days. The problem which I can identify is products offering resulting poor load factor. The products offering cover in-flight entertainment and premium products such as business class and first class. The current aircraft only offer small PTV and not fully flat bed on business class.

You Should & Shouldn't...

When you have a bigger competitor, you should:-

1) Your products should not be at the par with your main competitors but it should be better than your competitors in terms of pricing and quality. For example, Telco M offer RM0.10 per SMS and you shouldn't offer at RM0.10 per SMS because it does not attract the customers. When you offer RM0.08 per SMS and both offers the same quality of network coverage, people will use your service despite losing RM0.02 per SMS but at the end your loss of RM0.02 can attract more customers. Subsequently your loss can be covered with the increasing number of customers. Another example, when Airlines M offers same products as you offered, you shouldn't be at the par with your competitor especially your competitor has a good reputation. What makes customers to fly with you if both airlines have the same products. So market diversification equals into 50%-50% or even lower. You gain less customers as compared with your competitor.But when you have better products than your competitors, the market diversification is 50% and above. You gain more market shares! So better invest more and you get more customers in return.

2) Marketing: Advertise your products in tv commercials and mainstream magazines and newspapers that suits with target group of people.

3) Social media: Use Facebook and twitter to market your products, promotions etc or even as a medium tools to get feedback from your customers to improve your products in the future.

MAS Could Take Opportunity on Qantas's Fleets Grounding

October 29, 2011 - Malaysia Airlines System (MAS) could take this opportunity to market their brands, products and services when Qantas (the national carrier of Australia) grounded its entire fleets. There is a several way how to improve MAS presence in Australia. Which are:-

1) Market their brands and products since there is a huge number of passengers travelling to Europe and Asian countries from Australia.
2) MAS could act as a feeder for Qantas by offering flights to Qantas' stranded passengers to Europe and Asian countries from Australia or vice versa and in return Qantas will pay MAS for utilizing MAS fleets.

MAS has good services, one of the World's Best Cabin Crew and a 5-Stars airlines. MAS-Qantas has a good relationship and recently MAS join One World is sponsored by Qantas but MAS didnt take this opportunity to market them. MAS should be more sensitive next time.

Proton products and competitiveness

Proton is the Malaysia's first national car under the vision of Tun Dr. Mahathir Mohammad, former Malaysia's Prime Minister. The first proton car was introduced in 1988 based on Mitsubishi car which is known as Saga in Malaysian market. Through over the years research and development (R&D), Proton had made their own car such as Waja, Gen-2, Saga BLM, Pesona and Savvy and their own engine from Campro to Campro IAFM and later CPS. Proton has won numerous awards since their establishment. Presence in so many countries such as United Kingdom and Australia.

Since recent years the automobile industry getting tougher. Proton need to introduce new model such as replacement for Perdana V6. Perdana V6 is too long in the market and the technology are outdated and based in 12 years back technology. New model should offer executive interior looks and target for medium to high end market. Thus the Proton should study from Toyota Camry, Honda Accord, Mercedes C-class & BMW 3 series before introduce a new model.

Proton new MPV, Exora is a good car with the size and technology equipped. Price are relatively low which is good car to buy. The Exora would be better if the door based on slide door (like Estima / Alphard) rater than normal door. Besides that, the Exora is equipped with 1.6 CPS engine which is under-power for Exora body size. The 1.8 engine would be the best for Exora car.

In terms of the reliability of the Proton engine, I would say their engine are great with no problems (at most a minor problem) but their fuel consumption a bit higher as compared with other Japanese cars with the same engine capacity or more. For example, Satria Neo 1.6 CPS consume more fuel as compared with bigger body size of new Honda Civic 1.8. Proton need to enhance their R&D so that Proton could offer better fuel efficiency engine and compete with other main competitors. Further more it will protect our environment as it produce less emissions.

MAS Economy Class

Malaysia Airlines (MAS)new 737-800 is a great aircraft as it comes with Boeing's Sky Interior and new in-flight entertainment. However, their economy seat pitch is relatively small which is 30" as compared with Garuda Indonesia (31"-32"), Singapore Airlines (32") and Thai Airways (31"). Malaysia Airlines should adjust the seat pitch on their coming next 737-800 to a bigger seat. MAS is a 5-star airlines, thus they should provide comfortable seats to their customers. Besides that, with bigger seats, MAS could capture the market share loss to Singapore Airlines, Thai Airways and Garuda Indonesia which offer bigger seats. However, MAS 777-200ER and 747-400 economy seat still one of the largest ever at 34" beats it's rival but same as Qatar Airways and Saudi Arabia Airlines.

Malaysia Airlines: Business Improvements and Strategy

Expand Malaysia Airlines when there is an opportunity available. Malaysia Airlines should deploy new routes to Zurich, Madrid, Athens, Kuwait City, Doha, New York, Hawaii and Christchurch. Don't ask about the load factor because there is so many ways to improve the load factors by simply marketing strategy, product offering and transiting before the final city. My suggestion or my point of view is Malaysia Airlines should introduce new business class on their fleet. Current business class seat are small in size and are not full flat lie bed. Besides that, Malaysia Airlines could deploy on the following routes:

1) Kuala Lumpur - Doha - Muscat - Doha - Kuala Lumpur
2) Kuala Lumpur - Kuwait City - New York - Kuwait City - Kuala Lumpur
3) Kuala Lumpur - Tehran - Moscow - Tehran - Kuala Lumpur
4) Kuala Lumpur - Tokyo Narita - Honolulu - Tokyo Narita - Kuala Lumpur
5) Kuala Lumpur - Johannesburg - Sao Paolo - Johannesburg - Kuala Lumpur
6) Kuala Lumpur - Melbourne - Christchurch - Melbourne - Kuala Lumpur
7) Kuala Lumpur - Zurich - Kuala Lumpur
8) Kuala Lumpur - Athens - Madrid - Athens - Kuala Lumpur

Malaysia Airlines might concerned on the availability of an aircraft to deploy these routes. Malaysia Airlines could use operating lease for temporary to test the markets and when the market is there, malaysia airlines can subsequently purchase a new aircraft to cater the demand and growth.

With a new aircraft, Malaysia Airlines can reduce fuel consumption with better fuel efficiency aircraft. Besides that, Malaysia Airlines can offer a new products such as new first, business and economy class, nicer interior, shower for first and business class, Wifi and mobile phone coverage on board.