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