‘Question mark over future of planes bought in 2016, 2017’

KUALA LUMPUR: Malaysia Airlines Bhd chief executive officer (CEO) Peter Bellew’s unexpected departure has made another dent in the national carrier’s brand and given rise to concern about its future plans, said analysts.

“Not only did it lose two B777200 aircraft and more than 500 lives in 2014, the carrier also lost its first foreign CEO when Christoph Mueller departed in the middle of last year after just a year on the job. Now, it has lost its second CEO,” said Shukor Yusof, founder of Malaysia-based aviation advisory firm Endau Analytics.

Shukor, a former aviation analyst with Standard & Poor’s, said the airline’s credibility had been affected by the latest development, which also raised a question mark about the future of airplanes that it had bought last year and this year.

Shukor said there was no indication what Malaysia Airlines planned for the eight Boeing Dreamliners, six Airbus A350s and six Airbus A330-200s that would be delivered soon.

Another aviation analyst, who declined to be named, said the purchase of new airplanes was rather puzzling since the carrier had axed many routes as part of its rationalisation plan after being taken private in 2014.

“Will Malaysia Airlines reintroduce routes to Europe, America, Dubai and Turkey or will it continue to focus on Asia Pacific and Asean routes like what was stated in the 12-point recovery plan in 2014?” said the analyst.

Malaysia Airlines was taken private by major shareholder Khazanah Nasional Bhd after the airline suffered two disasters involving flights MH370 and MH17 as well as financial losses.

It recently made a firm order for 16 Boeing planes, comprising eight 787-9 Dreamliners and eight additional 737 MAX 8.

In July last year, Malaysia Airlines made 25 firm orders of the B737 MAX and 25 purchase rights of the same model worth US$5.5 billion (RM23 billion) at list price.

Earlier this year, Khazanah said Malaysia Airlines was operationally profitable and would return to the black by the end of next year.

“The airline is now able to rely on its own cash flow to operate and is expected to break even this year,” said Khazanah managing director Tan Sri Azman Mokhtar at a briefing in January.

Khazanah has spent more than RM5 billion for the restructuring of Malaysia Airlines.

Under the recovery plan, Malaysia Airlines needed RM6 billion for delisting, restructuring and rightsizing. Its load factor, said to be in the low of 70 per cent at the end of last year, was targeted to touch 80 per cent next year. Bilqis Bahari