Malaysian leader says the country can no longer afford to keep the loss-making national carrier afloat, opening the way for a foreign takeover
Does Malaysia really need a national airline? That’s the question many are asking as Malaysia Airlines (MAS) comes under rising pressure to revise its growth strategy and profit plan after consecutive years of poor performance.
The loss-making flag carrier has struggled to stay afloat after being privatized in 2014 by Khazanah Nasional Berhad, the Malaysian government’s sovereign wealth fund. A five-year recovery plan was unveiled soon after the state investment arm became the airline’s sole shareholder with an aim of returning the carrier to profitability within three years.
Despite a six billion ringgit (US$1.47 billion) capital injection and retrenchment of some 6,000 staff, MAS has yet to break even and recently failed to meet its March 2019 target date for re-listing on the local bourse.
Last year, Khazanah posted its first annual loss in more than a decade, with nearly half of its registered 7.3 billion ringgit ($1.78 billion) impairment loss attributed to keeping the airline afloat. The state fund has yet to indicate if it will inject additional funds into the airline and recently called on the company’s management to produce a new strategic plan to produce better returns.
Nile Bowie is a writer and journalist with the Asia Times covering current affairs in Singapore and Malaysia. He can be reached at nilebowie@gmail.com.
Does Malaysia really need a national airline? That’s the question many are asking as Malaysia Airlines (MAS) comes under rising pressure to revise its growth strategy and profit plan after consecutive years of poor performance.
The loss-making flag carrier has struggled to stay afloat after being privatized in 2014 by Khazanah Nasional Berhad, the Malaysian government’s sovereign wealth fund. A five-year recovery plan was unveiled soon after the state investment arm became the airline’s sole shareholder with an aim of returning the carrier to profitability within three years.
Despite a six billion ringgit (US$1.47 billion) capital injection and retrenchment of some 6,000 staff, MAS has yet to break even and recently failed to meet its March 2019 target date for re-listing on the local bourse.
Last year, Khazanah posted its first annual loss in more than a decade, with nearly half of its registered 7.3 billion ringgit ($1.78 billion) impairment loss attributed to keeping the airline afloat. The state fund has yet to indicate if it will inject additional funds into the airline and recently called on the company’s management to produce a new strategic plan to produce better returns.
Read the full story at Asia Times.
