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Malaysia Airlines reaffirms agent links as profit nears

August 1, 2017 Headline News No Comments Email Email

Malaysia Airlines is on track to return to sustainable profitability by early next year – and working with Australian travel agents will continue to be vital, the airline’s chief executive, Peter Bellew, said yesterday.

Speaking on a visit to Sydney, Bellew said that the strategy of his predecessor was to sell direct to the public, unbundling fares.

Bellew said his own strategy was the exact opposite, a 180-degree turnaround.

“We are not going to unbundle our fares. We are not going to charge for IFE [in-flight entertainment), credit cards and so on. We are not going to skim people.”

Malaysia Airlines worked very closely with travel agents and would continue to do so, Bellew said. “We’ve seen a dramatic increase in business through travel agents here in Australia.”

Malaysia Airlines regional manager Bennet Stephens with the airline’s chief executive Peter Bellew

Bellew, a 30-year veteran in the aviation and tourism industries, joined Malaysia Airlines in September 2015 from Ryanair as chief operations officer. He said frankly yesterday that if an airline hadn’t got a loyalty program like Qantas, “probably the strongest in the world”, it needed to do business with agents.

He said Australia and New Zealand was key to the airline’s long-term success and the carrier is working on growth opportunities here, “opportunities that will only be possible with the ongoing support of the travel trade”.

Bookings from Australia for the next six months are up 6% year-on-year, he said. “We expect to be profitable next year. Commercially we are doing fine now.”

Peter Bellew against the backdrop of Sydney’s Queen Victoria Building yesterday

On other points, Bellew said:

  • Last December, Malaysia Airlines’ network-wide load factor hit 90%, proof positive that the brand is strong. It is consistently running at over 80%.
  • Malaysia Airlines is preparing for new routes and new aircraft. In coming months it will take delivery of its first Airbus A350-900, the first of six A350s. It will also receive the first of 12 extra Airbus A330s and expand its route network significantly.
  • The move to Amadeus is running smoothly. The Amadeus back end is working well and the full system should be operational by the end of September. All the fares are in there and easily bookable, including code-shares and interlines.
  • Malaysia Airlines wants to get back to serving Brisbane. It doesn’t have the aircraft at the moment but when it does, it will most likely be an A330 that serves the route.
  • Malaysia Airlines plans a “a complete reboot” of its Enrich frequent flyer program. “Of all things in the company, it has the most potential. We will put resources behind it.”
  • The airline is revamping its business lounges, in Kuala Lumpur and London.
  • The incredible value of Malaysia, and Kuala Lumpur in particular, is worth stressing Bellew said. At his favourite local restaurant in KL, two main courses cost three Australian dollars.
  • Six Airbus A350s are on the way. Malaysia Airlines will begin flying them to London in the second quarter of 2018. Crew training is already completed. “We should have four delivered by the end of March and should have all six by the end of June. We are still working out where we will deploy last two aircraft. Whatever we do with them they will be on sale by this October.”
  • MAS wants to be “very open and transparent with media”. It was accused of being less so after the twin tragedies of MH370 and MH17. Bellew said that while the tragedies had been incredibly sad for all relatives and bereaved, it also hit Malaysia Airlines’ people hard. A healing was taking place in the company. Many employees had worked there 25 to 30 years, and having been through “this terrible tragedy” and the financial problems of the past 10 years had revealed the tough, steel backbone of Malaysia Airlines’ people.
  • The closest airline relationship Malaysia Airlines has? Japan Air Lines (JAL). Qantas is also a oneworld partner.
  • Malaysia Airlines Berhad (MH) has been operating direct services to Australia and New Zealand for over 42 years. It currently provides 47 non-stop services to five gateway cities across the region from its Kuala Lumper hub, but also from Kota Kinabalu into Perth.

Written by Peter Needham

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