During the recent media briefing by Malaysia Airlines (MAS) new managing director about MAS latest turn around plan which received a cold by the medias and analysts, many claim the transformation plan as ' nothing new' , 'the old same story' and nothing different as game changer.
However, I see one in particular that will be the game changer i.e. that MAS will set up a regional airline. MAny also questioned this decision, but looking beyond , this regional airline will focus on short haul routes within SEA region and perhaps within 5 hours flight from Kuala Lumpur for destinations in India and China. Meantime, Malaysia Airlines will focus on long haul routes in their quest to be the best premium airline in the world and to regain its brand just like in the glory days. This regional airline will have separate management team as profit centre.
With this plan, Malaysia Airlines as a "parent" will have the following "children" under its custody ; 1. Firefly - focus on turbo prop operations; 2. MasWings- focus on Brunei-Indonesia-Malaysia remote areas; 3. New regional airline ( Flamingo Airlines ???? )- focus on SEA + India + China; 4. Potentially new premium airline ??
How is it possible for MAS to have so many airlines ? Let us examine other things and development surrounding the industry so that we will have a bigger picture and better understanding the rationale behind all this.
No. 1
Qantas has revived its plan to set up a premium airline to be based either in Kuala Lumpur or Singapore, nothing firm as of today. I am excited about this and my only hope as a Malaysian, Qantas will choose Kuala Lumpur as its hub- though Singapore as a clear choice as business hub in the region, still there is hope because we have something more to offer than Singapore.
No.2
During Dato' Seri Idris Jala as MAS chief, there have speculation and initial talk about cooperation between Qantas and Malaysia Airlines i.e. just before his departure from MAS.
No.3
Back in 2009 , in December 2009 @ Kenza4u.blogspot.com I blogged about how to make KLIA a hub to compete with Changi and Suvarnabumi alike in one of my entries- In that blog, I threw our idea about MAS to potentially have alliance or co-operations with other airlines, not only via codeshare or joint venture ,IF the government role to protect MAS's interest as a national airline at the same time making KLIA as an airline hub in the region. I could sense that similar idea is being discussed not only to make MAS an airline of choice, but to make KLIA as a hub ( indirect benefit) of MAS turnaround plan. How this will work ?
First, with closer co-operation with Air Asia via. share swap (though many are skepticals about this whole ideas). My view, Air Asia will focus on low cost market segment with MAS premium market. Firefly, to make Subang Airport as their hub for turboprop ( where MAHB ) has stake in this arrangement too. There is a plan in the making to connect Kuala Lumpur International Airport via train and with MRT project is in the pipeline and bus services, passsengers will have seamless connection and access to Firefly. Firefly may be entrusted to serve smaller airports throughout the country. There is possibility also that Firefly will be part of a party in the coming premium airline ( personal jet market segments) propose by Qantas with its potential shareholders- Air Asia, MAS via Firefly, Qantas, Jetairways and British Airways.
No. 4
Progress is on-going for Malaysia Airlines to join Oneworld Alliance in later quarter of 2012, where Qantas and British Airways are the two members. What will happen then ? Logically, Qantas and British Airways as members of alliance will shift its focus of operations into KLIA to feed and connect passengers from Australia & beyond/UK & beyond to SEA region and North Asia and South Asia via new regional airline (Flamingo Airlines ??), Air Asia, Firefly and new premium airline. MAS will complement British Airways, Qantas to increase frequencies between Australasia, Asia and Europe and potentially North America and Latin America. Will MAS be the loser trying to compete with BA and Qantas ? No, if MAS have code share through OneWorld Alliance. Rather than competing on the pricing and cutting price and killing each other, this alliance will benefit all airlines plus its associated service industry - cargo, aircraft maintenance & repair, catering and ground handling. This is basically, what Blue Ocean strategy is all about. Rather than bleed each other, work together to create win win situation for all.
No. 5
Long before that, Air Asia signed MoU with Jetstar to explore areas of cost saving and areas of co-operation. So, with all these are happening, it will be a reality.
No. 6
Now that KLIA2 is bigger than its original plan and design to cater more passengers. Is Malaysia Airport Holding Berhad have priviledge information that we are do not have ?
No. 7
So, with all the news that are brewing in the air, the industry is getting more interesting with different ball game and game changer, that I believe will once again change ( after middle easterns phenomenon + airline mergers of KLM-Air France alike) the landscape of airline industry. The South East Asean region is an interesting region that both British Airways and Qantas can't ignore with a total population of close to 660 million plus India and China as neighbours. It offers huge potential for airline industry with increase in middle income and rich and famous, there will always demand for both low cost and premium airline. With 2015 is getting nearer ( i.e. open skies agreement for ASEAN), the region offers so much opportunities.
No. 8
Air Asia is now in Japan and Phillipines, new additions beside of Thailand and Indonesia.
Will customers be deprived and in disadvantage position ? My answer is NO. Why ? 1. Customers will have a choice - low cost vs. full carrier services ; 2. Still there is competition- between other airlines which are not part of the alliances such as middle easterns etc; 3. Better services and offering- value for money; 4. Access to routes which MAS has no direct flight, but now offered by partners in the alliances; 5. More options to collect points and benefit from loyalty programs;
I would like to see the alliance between Malaysia Airlines- British Airways- Qantas- Air Asia- Jetstar- Firefly- Mas Wings- Flamingo Airline -Premium Airlines to materialise, because all share in common i.e National Carrier and proud of the nations. The next question, will Malaysia government and Malaysians in general ( including the oppositions) is ready to make quick decision to seize this opportunity ? Are they bigger plans for MAHB that comes with MAS transformation plans as both MAHB and MAS are owned by Khazanah Nasional Berhad ?
As Tony mentioned it, MAS new MD is not a type of person who blows the trumpet before MAS actually turn to black. He would rather talk less, more actions and deliver .
Just wait and see or "Am I Just Dreaming ?"
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