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MAS-Emirates partnership set to sharpen competition

December 9, 2015 Aviation, Headline News No Comments Email Email

egtmedia59Malaysia Airlines (MAS) will keep its double-daily flights to London even though it’s set to axe flights to Paris and Amsterdam under its new “reciprocal code-sharing partnership” with Emirates.

Emirates will sell MAS codeshare flights via its agent distribution as well as on its website, analysts say, thus widening distribution channels for MAS. This is similar to Qantas London-Sydney flights being on the Emirates website. Emirates will sell destinations like Langkawi, Kota Kinabalu, Kota Baru and even Bintulu on its global website.

“Both airlines will carry each other’s passengers for a percentage of the ticket price,” Malaysia-based publication AsiaOne said.http://www.ramadaphuketdeevana.com/

The deal is a win for both airlines, according to Malaysia Airlines group chief executive Christoph Mueller, who told Malaysian publication StarBizWeek the pact was mutually agreed and “mainly benefits our customers because now with a MAS ticket, they can reach the entire globe”.

The new deal with Emirates comes into effect next February.

AsiaOne noted: “Many wonder what made Emirates want to partner MAS, as it could have chosen any other airline as the local airline has suffered from big setbacks in recent times.”

The London route aside, MAS will effectively become largely a regional carrier, ending loss-making long-haul routes (like Paris and Amsterdam) and relying on Emirates to give it global reach beyond the Asia-Pacific region.

Financial analysts interviewed by AsiaOne said Emirates was the perfect partner, which was why Qantas had made the same choice in April 2013 when it switched from Singapore to Dubai as a connection point into Europe.

Qatar Airways might have been another choice for MAS but Emirates is far bigger, with a network spanning over 140 destinations. Its deal with MAS gives Emirates a major new gateway into the Asia-Pacific.

CAPA Centre of Aviation analyst Brendan Sobie writes that Gulf carriers now operate almost 60 daily flights to South-East Asia and almost 20 to Australia.

Some analysts speculate that Emirates may eventually consider becoming a strategic investor in MAS.

MAS suffered a drop in ticket sales after the twin disasters of last year and Mueller concedes that “loads were very low” while declining to provide numbers, AsiaOne said.

In some ways, an alliance with “world champion” Emirates may help compensate MAS for brand damage caused by the twin accidents of MH370 and MH17 in 2014.

Asian analysts are certain that the Emirates-MAS deal will sharpen local competition, with players like AirAsia and Malindo Air keen to ensure they get some of Emirates’ traffic to avoid losing market share to MAS.

Written by Peter Needham

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