MAS eyes bigger share in Muslim pilgrims flights
PETALING JAYA: Malaysia Airlines Bhd (MAS) is aiming for a 10% market share of flying Muslim pilgrims on charter flights to Saudi Arabia, as it prepares to launch its new charter services using the reconfigured A380 aircraft sometime in October this year.
There are about one million pilgrims who perform their hajj and umrah yearly from the region, and the airline already controls about 6% of this market, said its new group CEO Captain Izham Ismail.
“How much more can we tap ... so we are forecasting 10% (market share), if not more. We are doing about 6%-7% and we have secured nearly 100 charter flights for 2018 and that is why since November we have been doing daily flights,” he told Star Biz in an interview.
That explains why Izham has been harping on its sales team since November to push for higher sales for pilgrim charters.
“I told the team, we cannot wait till the fourth quarter. We need to go to the market now, sell now and represent Malaysia Airlines. So, now we (MAS) have daily charter flights to Jeddah,” he added.
This is part of the efforts to boost ancillary income with the usage of its available asset. The A380 is such a huge aircraft offering economies of scale, and for MAS, it is about playing a bigger role in this market with its product and pricing.
MAS was in talks with several travel agents across the region to form alliances to ferry pilgrims from the region into Saudi Arabia. Now, it flies pilgrims from Indonesia to Saudi Arabia. It is also in the process of getting all the certifications for Project Amal to take off.
He said MAS can feed traffic through KLIA and expand into South-East Asia, China and Vietnam. It will not stop there, as markets such as Bangladesh and India offer potential, as do the African and Eastern European markets. However, it needs to look at regulations as to how it can ferry pilgrims from there.
“We feel this is an exciting business. To a certain extent, we can shape it and make it profitable. Rather than just delivering the normal service, we will offer our services with Malaysian hospitali- ty for our hajj and umrah flights,” he added.
Hajj and umrah traffic represents a recurring stream of annual revenue for airlines, tour operators and brokers. Without disclosing figures, Izham said it was a profitable business and that MAS’ contract with Lembaga Tabung Haji to fly pilgrims this year has been extended.
The six A380, once reconfigured, will offer 700 all-economy seats, an increase of 204 from the current 496 for charter flights.
Last year, 1.74 million foreign pilgrims arrived at Saudi Arabia’s Jeddah and Medina airports, more than 570,000 came from Indonesia, Pakistan and India.
If Project Amal takes off as planned, then MAS will be the world’s first airline from this region to cater specially to hajj and umrah pilgrims using the jumbos.
Globally, it is a huge market and some players use old aircraft to service the route, though there is talk of new regulations limiting older aircraft from ferrying pilgrims. “If that is implemented, then MAS will be in a very positive position,” said a market player. Commercial airlines also lease extra planes to run hajj- specific services.
Since it will be using the A380 for its pilgrim charter business under its Project Amal initiative, MAS will remove the big bird from its existing London route and replace it with its new A350 aircraft. The A350 will begin serving the KL-LondonKL route this weekend. It has ordered six units of A350 and taken delivery of two.
With the product change comes a caterer change, as MAS will be using Pos Aviation Sdn Bhd instead of Brahim’s Holdings Bhd for its in-flight catering on its London route.
Pos Aviation (formerly KL Airport Services Sdn Bhd) provides in-flight catering on some other MAS routes and also for other airlines.
Izham is excited about the A350 aircraft and feels it is necessary “to offer something different to our passengers on the London route”.
However, until Project Amal (formerly known as Project Hope) takes off, the A380 will still be deployed opportunistically during peak periods to high-traffic markets such as London, as Izham believes in sweating the assets.