Saturday, October 25, 2014
FAIRFIELD-SUISUN, CALIFORNIA
99 CENTS

Malaysia Airlines revamp: New start or false hope?

By
From page B6 | August 09, 2014 |

HONG KONG — Hemorrhaging cash after almost unfathomable double disasters that killed 537 people, Malaysia Airlines will be brought back under the wing of the Malaysian government as a prelude to a comprehensive overhaul of the airline. It will be the latest in a string of restructurings of the carrier over the past decade, all of which failed to put it on a steadier flight path. Some analysts doubt the airline will be in a much improved position in another five years. Here are some questions and answers on what lies ahead:

— WHY DOES THE AIRLINE NEED AN OVERHAUL?

Malaysia’s struggling national airline continues to lose money in spite of four major restructurings in 12 years. Two disasters within months of each other— the disappearance of flight MH370 and the downing of MH17 over Ukraine — may have dealt a fatal blow to the airline’s finances.

— WHAT IS THE PLAN?

Few details have been released by Khazanah Nasional, the Malaysian sovereign wealth fund that has a controlling stake in the airline and wants to mop up the minority of shares it doesn’t own. The fund said that after it owns all the shares it will carry out a “complete overhaul” including operations, business model, finances, staff and regulations. “Nothing less will be required in order to revive our national airline to be profitable as a commercial entity and to serve its function as a critical national development entity,” it said.

— WHAT NEEDS TO BE DONE?

Malaysian Airlines needs to cut costs to stem the red ink that amounted to 1.3 billion ringgit ($405 million) in losses last year alone. Top of the list is trimming staff, which at nearly 20,000 is “relatively sizeable” compared with other full service carriers such as Singapore Airlines and Cathay Pacific Airways, analyst Jerry Lee of RHB Bank wrote in June. But staff cuts have always been a politically sensitive issue because the airline is state-owned. Experts say the airline could also reduce its fleet. Passenger capacity has risen in recent years as the airline brought in new planes, forcing it to discount airfares aggressively to fill enough seats. There’s also talk the carrier could sell its profitable maintenance division.

— WHAT COULD THE AIRLINE LOOK LIKE IN 5 YEARS?

Malaysian Airlines could be slimmer, have new executives, and fly less often to some destinations. Some have suggested a new name is needed but don’t expect radical changes. It’s unlikely to expand heavily into the discount market to compete with AirAsia, the country’s highly successful low-cost carrier, said Brendan Sobie, analyst at CAPA The Centre For Aviation. Other analysts are doubtful that its fifth restructuring will do the trick. “I’m skeptical of the success of this new measure,” said Shukor Yusof, founder of aviation research firm Endau Analytics. “The root problems are not being looked into seriously, things like the strategy, the business model and what they want the company to be in the long term.”

— HOW HAVE OTHER NATIONAL AIRLINES FARED AFTER RESTRUCTURINGS?

Following bankruptcy in 2010, Japan Airlines Co. returned to solid profitability. The airline, once a Japanese icon, was saddled with a bloated workforce, unpopular routes, safety lapses and mountains of debt. New management trimmed a third of the payroll, invested in budget carriers, retired big jets in favor of smaller ones and focused on international routes instead of less profitable domestic ones. The company returned to the stock market with an $8.5 billion IPO in 2012. Swissair International Air Lines was created out of the ashes of Swissair, which went out of business in 2002, becoming the first airline to collapse after the Sept. 11 attacks. The new airline suffered financial problems for several years but subsequently returned to profit. It’s now owned by Lufthansa.

 

The Associated Press

The Associated Press

LEAVE A COMMENT

Discussion | No comments

The Daily Republic does not necessarily condone the comments here, nor does it review every post. Read our full policy

.

Solano News

 
Suspects tie up customers, workers during armed robbery

By Susan Winlow | From Page: A1, 1 Comment | Gallery

 
Fall Harvest Festival brings children back to school

By Susan Hiland | From Page: A3 | Gallery

 
Optimist Club brings youth together for Halloween golf

By Amy Maginnis-Honey | From Page: A3

No new murder trial for Calkins, judge rules

By Ryan McCarthy | From Page: A3

 
Cut-a-thon to help fight cancer, abuse

By Susan Hiland | From Page: A3

Haunted hikes offered for brave souls at park

By Susan Hiland | From Page: A4

 
School board candidates forum set next week

By Susan Winlow | From Page: A4

 
Suisun City police log: Oct. 23, 2014

By Susan Hiland | From Page: A9

.

US / World

Suspect arrested in death of 2 California deputies

By The Associated Press | From Page: A1

 
KC-10 from Travis lands in Houston, smoke in cockpit

By The Associated Press | From Page: A3

Reagan astrologer, Joan Quigley, dies at 87

By The Associated Press | From Page: A4

 
Jury says castrated sex offender should be freed

By The Associated Press | From Page: A4

NY, NJ order Ebola quarantine for doctors, others

By The Associated Press | From Page: A9

 
.

Opinion

SEIU shouldn’t own Board of Supervisors

By Letter to the Editor | From Page: A8, 1 Comment

 
Vote, and make a difference

By Letter to the Editor | From Page: A8

Yes on Measure A

By Letter to the Editor | From Page: A8

 
.

Living

.

Entertainment

.

Sports

Hamilton helps Vanden sink Vallejo, 35-0

By Nick DeCicco | From Page: B1

 
Vintage rolls past Armijo, 55-8

By Mike Corpos | From Page: B1

Mustangs fall flat in rout by Wildcats

By Marcus Lomtong | From Page: B1

 
Royals beat Giants 3-2 for 2-1 World Series lead

By The Associated Press | From Page: B1 | Gallery

Falcons hang with Wolves in 34-8 setback

By Paul Farmer | From Page: B1 | Gallery

 
Vargas to take on Vogelsong in Game 4 of Series

By The Associated Press | From Page: B1 | Gallery

Raiders’ Woodley, Young expected to be placed on IR

By The Associated Press | From Page: B2

 
Joe Maddon exercises opt-out, won’t return to Rays

By The Associated Press | From Page: B2

Attorney: NFL, Ravens not helping union in Rice probe

By The Associated Press | From Page: B2

 
SCC women’s soccer team falls to Mendocino 3-1

By Daily Republic staff | From Page: B2

Jamie McMurray bests Chase drivers to win pole

By The Associated Press | From Page: B2 | Gallery

 
Lloyd leads US women past Mexico 3-0

By The Associated Press | From Page: B2

Henley’s putting gets him lead at Sea Island

By The Associated Press | From Page: B2

 
Unfazed, 49ers coach Jim Harbaugh doing it his way

By The Associated Press | From Page: B2

Judge halts New Jersey’s sports betting plan

By The Associated Press | From Page: B2

 
This date in sports history for Saturday, Oct. 25, 2014

By The Associated Press | From Page: B3

 
.

Business

US official: Auto safety agency under review

By The Associated Press | From Page: B4

 
Ford profit falls in third quarter on truck costs

By The Associated Press | From Page: B4

Procter & Gamble taking out its batteries

By The Associated Press | From Page: B4

 
UPS expects double-digit surge in Dec shipments

By The Associated Press | From Page: B4

US new-home sales close to flat in September

By The Associated Press | From Page: B4

 
.

Obituaries

Mark Dean Lindsay

By Nancy Green | From Page: A4, 1 Comment

 
Dr. Robert M. Takamoto

By Nancy Green | From Page: A4

Melvin Tate

By Nancy Green | From Page: A4

 
.

Comics

Baldo

By Daily Republic Syndicated Content | From Page: A6

 
Baby Blues

By Daily Republic Syndicated Content | From Page: A6

Frank and Ernest

By Daily Republic Syndicated Content | From Page: A6

 
Sally Forth

By Daily Republic Syndicated Content | From Page: A6

Wizard of Id

By Daily Republic Syndicated Content | From Page: A6

 
Zits

By Daily Republic Syndicated Content | From Page: A6

Peanuts

By Daily Republic Syndicated Content | From Page: A6

 
Beetle Bailey

By Daily Republic Syndicated Content | From Page: A6

Dilbert

By Daily Republic Syndicated Content | From Page: A6

 
Rose is Rose

By Daily Republic Syndicated Content | From Page: A6

Word Sleuth

By Daily Republic Syndicated Content | From Page: A7

 
Bridge

By Daily Republic Syndicated Content | From Page: A7

Sudoku

By Daily Republic Syndicated Content | From Page: A7

 
.

Home Seller 10/25/14

Real estate transactions for Oct. 25, 2014

By Daily Republic | From Page: HSR2