From my previous posts, MAS has received their new B737-800 and started operating it on its maiden flight to Kota Kinabalu International Airport on Nov 15.

Media Release
160 First To Fly On MAS' New B737-800

Nov 15, 2010

Subang (15 October 2010): Some 160 guests and MAS’ senior management team were the first to fly on Malaysia Airlines’ new B737-800 which departed for Kota Kinabalu today.

The national carrier is the first full service airline in the world to operate the B737-800 with the new Boeing Sky Interior.

Managing Director/ Chief Executive Officer, Tengku Dato' Sri Azmil Zahruddin said, “We are delighted to have our guests enjoy an interior which is based on that of the B787 Dreamliner including the use of mood lighting to enhance comfort. The new cabin offers bigger stowage bins, higher ceiling, and larger windows.

“One of the latest features is the touch-screen inflight entertainment units in every business and economy seats, individual power supply and USB ports for electronics.”

Guests included Deputy Minister of Transport, Dato’ Abdul Rahim Bakri; Department of Civil Aviation’s Director-General, Dato’ Azharuddin Abdul Rahman; MAHB’s Senior General Manager (Operations), Dato’ Azmi Murad, corporate clients, travel agents and many more.

The 160-seater aircraft sports a new dynamic livery with red and blue lines, Malaysia Airlines' corporate colours.

He said, "The dynamic livery epitomises our determined spirit to provide Malaysian Hospitality to our guests.

“When deciding on the new livery, we considered a number of designs including those that were similar to our very popular hibiscus and heliconia designs. However, these designs added a significant amount of weight to the aircraft, which would not have been very environmentally responsible. Therefore, we went for a cleaner design that is more flowing and environmentally friendly.

"We will receive 3 B737-800 this year, and our first A330-300 next year. These are exciting times for Malaysia Airlines and our customers who will enjoy the latest generation aircraft."

Upon the aircraft’s arrival in Kota Kinabalu, the Chief Minister of Sabah, Datuk Seri Panglima Musa Haji Aman will launch the city as Malaysia Airlines’ Eastern Hub.

Malaysia Airlines is leveraging on the strategic location of Kota Kinabalu as an ideal gateway to promote travels to and from Australia, China, Hong Kong, Taiwan, Japan and Korea.

The first commercial flight on the B737-800 will be from Kota Kinabalu to Haneda, Tokyo, departing at 4.35pm.

Malaysia Airlines have ordered up to 55 B737-800, 25 A330-300 and 6 A380. By the end of 2010, there will be 3 B737-800 in service. Next year, there will be 6 B737-800 and 5 new A330-300 in operations – the first of which will arrive in April 2011.

Malaysia Airlines’ new B737-800 inaugural flight to Kota Kinabalu (L-R) Malaysia Airlines MD/CEO Tengku Dato' Sri Azmil Zahruddin and Malaysia's Deputy Minister of Transport, Dato’ Abdul Rahim Bakri.

Cabin crew inside the new B737-800

Issued by:
Media Relations Unit/Communications Division, Malaysia Airlines

And again Malaysia Airlines has been voted the “World’s Leading Airline to Asia” by World Travel Awards (WTA) which gives recognition to the very best in travel, tourism as well as hospitality products and services.

Since 1993, Malaysia Airlines has flown over 17 million passengers from outside Asia to its hub in Kuala Lumpur. On an annual basis, the national carrier brings in over one million customers from outside Asia to Malaysia.

Malaysia Airlines is an award winning airline. This year alone, the airline was accredited with “Staff Service Excellence for Asia Award 2010” and “World’s Best Economy Class Award 2010” by Skytrax. It is also recognized as the “Best Airline in Southeast Asia” by GT Tested Awards, Global Traveller Magazine and ranked 7th in the Top 10 Airlines Worldwide category for Best in Travel Poll 2010 by Smart Travel Asia.

By 2015, Malaysia Airlines will have one of the youngest and most environmentally friendly fleets in Asia Pacific.

(from left to right) MAS Regional Senior Vice President, UK and Ireland, Mr Syed Abdillah Syed Abdul Aziz; WTA Global Sales & Marketing Director, Mr James Khan; MAS Chairman, Tan Sri Dr Munir Majid ;and WTA President and Founder, Mr Graham E. Cooke, with a model and MAS cabin crew.

Local airlines expanding too quickly? Firefly, MAS and AirAsia may get 24 new aircraft next year (The Star)

Monday November 15, 2010

By Jeeva Arulampalam

PETALING JAYA: Can the local aviation sector support the rapid expansion plans of local airlines over the next several years? An educated guess may suggest otherwise.

Firefly, a wholly-owned unit of Malaysia Airlines (MAS), announced last week that it would commence jet aircraft operations out of the main terminal of Kuala Lumpur International Airport (KLIA) in January.

It aims to operate six B737-800 aircraft from KLIA next year to East Malaysia, on top of its turboprop aircraft operations for domestic and regional routes out of Subang Airport.

Maybank Investment Bank Research, citing data compiled by Malaysia Airports Holdings Bhd, said that the domestic sector recorded passenger volume of 13.5 million last year and has been growing at a 10-year compounded annual growth rate (CAGR) of 4.7%. The international sector carried 12 million passengers and has grown at a 10-year CAGR of 7.3%.

“Assuming these growth rates continue, it implies four to five additional aircraft will be required per annum to meet both domestic and international demand growth,” the research house said in a report issued last week.

Now, the local airline industry would see more than just four to five planes entering the market on a given year.

For instance, Firefly, MAS and AirAsia may receive as many as 24 new aircraft next year.

In total, MAS will receive up to 86 new passenger planes by 2016 (this is larger than its entire fleet of 60 planes today), but only 56 of the new orders are firm.

MAS is undertaking a fleet renewal exercise and will see it retiring its older aircraft.

Firefly plans to have 44 new planes, jets and turboprops, by 2015 compared with its current fleet of seven turboprop planes.

AirAsia has defered its order from 23 to eight planes next year. The company has made 175 firm orders of A320 aircraft, which should see the final aircraft delivery made in October 2014.

However, industry observers noted that AirAsia’s decision to defer aircraft could be due to slower anticipated passenger growth in tandem with the global economic recovery.

AirAsia, which has Thai and Indonesian affiliates, also has the luxury of redeploying next year’s aircraft orders to its neighbouring operations.

“We don’t think the (local) air traffic growth rate will be able to support (Firefly’s) fleet deployment plan, given that AirAsia and MAS also has their own fleet growth plans. It is looking very likely that somebody has to give in, and MAS is the most probable candidate to relent,” the report said.

While the B737-800 is the direct rival for the A320, Maybank said it was difficult to say which aircraft would be better as it boiled down to the purchase price and operational costs.

Analysts anticipate that competition would intensify between both low cost carriers, especially for domestic routes to East Malaysia, causing yields to come under pressure.

As it is, the fare war has begun with Firefly offering 50,000 seats as low as RM9 and AirAsia responding with a million free seats.

What remains to be seen is how quickly Firely can turn its jet operations profitable given the intensified landscape.

Little is known about Firefly’s financials as it was not disclosed by MAS’ management. The media and analysts were told in separate briefings last week that Firefly was profitable with its ATR operations and its net profit margin was above industry average.

What was disclosed was that the breakeven seat factor for an ATR is below 70%. The aircraft needs less than 50 passengers per flight to breakeven.

Possible shortage of pilots seen as airlines expand (The Star)
By Lee Kian Seong

PETALING JAYA: Airlines in Asia are increasing the recruitment of pilots and maintenance crew to meet growing demand for such professionals in the coming years because of aggressive expansion in the industry.

Although the airlines industry does not face a shortage of pilots at present, Malaysia Airlines (MAS) operations director Captain Azharuddin Osman sees a possible pilot crunch over the next few years as airlines take delivery of more new aircraft.

“We will see more demand for pilots in the next few years as airlines all over the world are taking delivery of more new aircraft,” he told StarBiz.

He said the recruitment of co-pilots in Malaysia was not difficult and in fact, a lot of young Malaysians had expressed an interest to join this profession. MAS currently has about 1,400 pilots.

“Demand for pilots is normally based on the company’s expansion plans and the number of aircraft in the system. We address the demand for pilots in two ways– through our own internal promotion and via our own cadet pilot training. We have also external recruitment from Malaysia or other countries,” Azharuddin said.

It was reported that there was a need for more than a million pilots and maintenance crew in the global commercial aviation industry in the next 20 years, with Asia accounting for almost 40% of the demand.

It was estimated that from 2010 to 2029, world demand for pilots and maintenance personnel would be 466,650 and 596,500 respectively. Of that amount, 180,600 pilots and 220,000 mechanics would be needed in Asia.

MAS executive vice-president of engineering and maintenance Mohd Roslan Ismail said that while there was great interest in maintenance crew recruitment in Malaysia, it was becoming more challenging to as the general level of English proficiency was a concern.

“This is a global industry where the medium of communication is in English and all aircraft manuals and documentation are in English,” he said, adding that MAS had currently more than 1,050 trainees and over 3,000 qualified technicians and engineers.

To meet manpower demands, Roslan said MAS worked with local academic institutions like Politeknik Shah Alam and the Malaysian Institute of Aviation to offer on-the-job training.

“We also train students sponsored by Yayasan Terenganu, Yayasan Johor and Felda to churn out engineers and junior technicians at our MAS Engineering Training Centre,” he said.

A Cathay Pacific spokesperson said the aviation industry was facing a shortage of engineers and that the airline was very keen in developing local aviation engineering professionals as well as attracting qualified engineering professionals to join the company.

“Pilot shortage is a phenomenon that affects all airlines, but it is not a particular problem for Cathay Pacific at the moment as we are not currently recruiting pilots.

“We have our own pilot training programme based in Adelaide, Australia, from which 341 pilots have graduated since our programme began in 1988. We currently have 106 cadets undergoing training in Adelaide,” the spokesman said.

A spokesman for Singapore Airlines (SIA) said: “SIA has always taken a long term view of our plans for pilots to ensure we have a pool to meet our operational requirements.”

The spokesman said its Singapore Flying College (SFC) trained cadet pilots from the early stages, adding that SIA had been recruiting cadet pilots in recent months and this was due to the fact that there were lengthy training lead times.

“At the moment, we are not hiring trained pilots but we do conduct occasional exercises where we hire them depending on operational requirements,” the spokesman said.

About 150 cadet pilots graduate from SFC every year, although this number could vary according to the company’s long term plans and crewing situation.

“Our turnover rate of pilots has been consistently low over the years and we are not short of pilots. We have over 2000 pilots and the response to our recruitment exercises for pilots has always been good,” the spokesman said.

MAS gets first B737-800 (Bernama)

Tuesday November 2, 2010

SUBANG: Malaysia Airlines Bhd (MAS) yesterday received its first B737-800, the latest generation aircraft which promises both economy and business-class passengers a better travel experience.

MAS' new B737-800 was welcomed with a water-cannon salute when it arrived at the Sultan Abdul Aziz Shah Airport in Subang.

Passengers will enjoy an in-flight entertainment system which will include audio and video-on-demand, roomier interior, better ambience, higher ceiling and mood lighting.

The national carrier had placed an order for 55 such aircraft with Boeing and would take delivery of three more by the year-end, said managing director and chief executive officer Tengku Datuk Seri Azmil Zahruddin.

“We are proud to announce that we will be the first full-service airline in the world to operate B737-800 with the new Boeing Skyline Interior,” he said after taking delivery of the new aircraft at Skypark Airport here.

Boeing B737-800 pilot Capt. Muhammad Affindy Abd Rahman (right) chatting with (from left) MAS CEO Tengku Datuk Seri Azmil Zahruddin, engineering and maintenance executive vice president Mohd Roslan Ismail, MAS chairman Tan Sri Dr. Munir Majid and operations director Capt. Mohamed Azharuddin Osman in the plane's roomy interior after flying it back from Seattle yesterday.

The 160-seater aircraft sports a new dynamic livery with red and blue lines representing MAS’ corporate colours.

MAS has also ordered 25 A330-300 and six A380 aircraft. It is expected to take delivery of the first A330-300 next year. — Bernama

In pictures:

The arrival of Malaysia Airlines’ new B737-800 aircraft at SkyPark Subang Terminal.

Malaysia Airlines’ Chairman and MD/CEO welcoming the Captains and the new aircraft.

Firefly to add more domestic destinations (The Star)
Monday November 8, 2010

By Jeeva Arulampalam

PETALING JAYA: Malaysia Airlines (MAS) has finally turned to wholly-owned unit Firefly to compete head-on with low-cost carrier (LCC) AirAsia as Firefly looks to add more domestic destinations now and Asean routes eventually.

As the global airline industry recovers, full-service carriers (FSC) in Asia are swiftly looking at ways to enter the low-fare segment and regain lost market share as more travellers opt to fly with LCCs.

While MAS plans to expand aggressively into Asia with its new fleet, it will not want to lose out on the short-haul market given that 78% of the 24 million tourist arrivals in Malaysia last year came from this market (more so neighbouring markets), 15% from medium-haul markets and 7% from long-haul markets. Firefly’s expansion can help address this concern.

StarBiz reported last week that Firefly, which operates turboprop aircraft from Subang, will start flying jets as early as the first quarter next year from KL International Airport.

Firefly will start flying jets from KLIA as early as the first quarter next year.

Citing sources, the report said that Firefly will initially use four to six B737-400s to provide cross-over flights to Sabah and Sarawak and add Asean destinations once it receives the relevant approvals.

To facilitate the expansion plan, MAS may continue to lease the B737 aircraft and charge Firefly a fee for the utilisation of these planes.

Firefly managing director Datuk Eddy Leong will reveal Firefly’s expansion plan today to the media.

HwangDBS Vickers Research viewed the expansion as positive for MAS, given Firefly’s profitable operations and ability now to help partly subsidise the loss-making routes.

“The expansion will also help MAS compete with AirAsia, which is estimated to have a bigger market share in Malaysia compared to MAS,” said the research house in a report last Thursday.

AirAsia Bhd group chief executive officer Datuk Seri Tony Fernandes remains unfazed by the expansion plans.

“We are beyond worrying about what legacy airlines do. AirAsia has grown and will continue to grow positively due to a disciplined focus on cost and the short haul single class model,” he told StarBiz.

It can be an uphill task for a FSC to operate its own LCC, considering that many LCCs have gone bust or were bought over by LCC rivals. For instance, Easyjet bought over British Airways’ LCC Go for £374mil in 2002 while Europe’s Ryanair purchased KLM Royal Dutch Airline’s loss-making LCC Buzz at £15mil in 2003.

Closer to home, Garuda Indonesia is now focused on fixing itself before it looks to mend its LCC Citilink Airlines.

There have been exceptions such as Qantas Airways’ successful LCC Jetstar Airways. Meanwhile, Singapore Airlines’ associate Tiger Airways has also done well in the regional LCC space.

HwangDBS said its main concern with Firefly’s expansion plan was the higher operating costs of the old B737s, which could affect its bottom line despite Firefly’s low-cost business model.

A local aviation analyst said the fuel consumption for the older Boeing aircraft was higher, at an average of 10% to 15% more per seat basis than the newer models.

Many of the LCCs like Jetstar, Tiger Airways and AirAsia operate relatively newer A320 planes.

Fernandes added that MAS’ decision to move into the LCC space would remove the last hurdle for AirAsia X.

“This removes the last blockage for AirAsia X and allows us to build a world class hub. Now MAS has entered our space, the long-haul market should be fully liberalised for AirAsia X,” he said.

Fernandes may not be too far off the mark, as the Government has stated its intention under the Economic Transformation Programme to enhance connectivity to priority medium-haul markets.

The plan is to increase frequencies to 10 priority cities, which include Beijing, Delhi, Melbourne, Mumbai, Osaka, Seoul, Shanghai, Sydney, Taipei and Tokyo. Malaysia is said to have a double-digit flight frequency gap to most of these cities compared with Singapore and Thailand.

The local transport ministry will be working on increasing air rights to the countries that have restricted air rights, primarily Australia, Japan and India. The distribution of subsequent air rights will also be done in a more transparent and liberalised manner, as the transport ministry develops an air rights allocation framework.

Metzelder says: The only thing I want to highlight is unethical biz plan by AirAsia. They merely accusing Government for over-protecting MAS as their 'golden child' after failed to lobbying for new route.

Besides that, please never compare MAS with AirAsia. Both are running different business model, MAS is a 5-star airline and is Full service carrier while AirAsia as World Best Low Cost Carrier will only remain as LCC. Comparison of fare prices is always an issue with passengers comparing it while the level of service and professionalisme is way different.

This is a very good prove to show how unethical are they.

The battle between AirAsia and Tiger Airways (The Star)
Friday Reflections - By B.K. Sidhu

Friday October 22, 2010

THE verbal spat between the two Tonys in the aviation sector reminds some people of how Tun Dr Lim Keng Yaik had to fight for the survival of palm oil back in the 1980s.

Then it was Lim against the Western world, and at stake was Malaysia’s palm oil industry.

Lim succeeded and today Malaysia is one of the biggest suppliers of palm oil globally.

This week the clash is between Tony and Tony – Datuk Seri Tony Fernandes, the boss of AirAsia Bhd; and Tony Davis, CEO of Singapore’s Tiger Airways.

Both helm award-wining airlines.

AirAsia has won numerous awards and so has Fernandes. The airline has a wide reach, has operations in Thailand via Thai AirAsia and in Indonesia via Indonesia AirAsia. Its sister airline, AirAsia X, is Asia’s first long-haul low-cost carrier.

To tease Tiger Airway for its recent flight cancellations, AirAsia ran full-page advertisements in Singapore newspapers with the tag-line “If Tigers were meant to fly, they would be born with wings”. The ads also featured a drawing of a tiger cub crying. But AirAsia regional head of commercial Kathleen Tan denies the ads had anything to do with Thai Tiger.

Tiger Airways is partly owned by Singapore Airlines. Based in Singapore, it flies to many destinations within Asia. On Tuesday it was named the Centre for Asia Pacific Aviation’s Low Cost Airline of the Year. Tiger Airways also has operations in Australia. It is about to seal a deal to set up Thai Tiger Airways, a low-cost airline in Thailand.

The new venture is the thing that triggered the spat.

Fernandes described Tiger Airways as an “odd” choice business ally to Thai Airways. He said this in an interview with Bangkok Post. He was sceptical about having Westerners running any successful Asia-based business, referring to some of Tiger Airways’ management.

“We’re Asians, not a bunch of white guys running the airline,” he said, explaining that Thai AirAsia was run by Thai management who know the local and Asian markets. Tiger Airways had also recently cancelled numerous flights that left thousands of passengers stranded due to manpower shortage and aircraft fault.

Tiger Airways in an immediate reaction said it was a “racist remark” made by Fernandes.

To rub salt into the wound, Fernandes also described Tiger Airways as “a tiny carrier”.

But Davis seemed unperturbed and he declared on Wednesday that Tiger aims to be among the top three global airlines.

This spat stems from competition. A new player in the Thai air market would mean more competition for Thai AirAsia.

To tease Tiger Airway for its recent flight cancellations, AirAsia ran full-page advertisements in Singapore newspapers with the tag-line “If Tigers were meant to fly, they would be born with wings”. The ads also featured a drawing of a tiger cub crying.

But AirAsia regional head of commercial Kathleen Tan denies the ads had anything to do with Thai Tiger.

“We thought it’s a great time to do things that are a little bit fun; a little bit wicked. It’s not meant as a one-up, we’re not attacking anyone, we were just being clever and witty to assert our marketing leadership. We love a good fight on the marketing front once in a while,” she said.

Whatever the campaign may be for, it did not stop Davis from saying, “It’s no wonder some of our competitors are getting so rattled.”

Thailand is a big tourism market. People from all over the world visit Bangkok and many other tourist destinations there so adding another player would keep the incumbents on their toes. Erosion of market share is to be expected.

Fernandes understands that and there is also nothing to stop Davis from entering the market since Thai Airways likes Tiger Airways.

These two Tonys may be taking a swipe at each other and coming up with all kinds to tactics to discredit each other but for the consumer, competition is great. Had AirAsia not set up operations in Malaysia we would probably still be paying premium airfares to travel and in the same vein, more budget airlines in Asia simply means even more people can fly.

Whatever the motivation of these rivals, what matters to the traveller is safety, good service, low airfares, more baggage room and comfort. The fiercer the fight, hopefully, the lower the airfares