Malaysia Airlines Confident of Profitable Growth (5-year network plan to serve high growth travel regions)
Kuala Lumpur (22 March 2007): Malaysia Airlines today announced its 5-year plan to capitalize on high growth travel regions through a more connected network.
The 2007-2011 network master plan will see the national carrier expanding its core network in Asia Pacific while strengthening its hub and spoke connectivity in Europe, Australia and New Zealand.
Malaysia Airlines Managing Director/ Chief Executive Officer, Mr Idris Jala said, “Our focus is to grow profitably. We will continuously anchor all our key business activities around our 3-year Business Turnaround Plan. We will implement our network master plan, intensify our maintenance, repair and overhaul business, and secure new businesses which include Firefly. Other ground breaking projects are also in the pipeline and will be announced later.”
Speaking to journalists during a media briefing at Invest Malaysia 2007, he said the network plan was developed based on passenger traffic outlook from 2006 to 2015.
"The Asia Pacific region is where the growth is. We expect to see vibrant growth as the economies remain strong at some 6% from now until 2015, ramping up the demand for air travel. These are exciting times especially as we expand into China and India.
"You will see us increasing the frequency of our flights and offering new destinations over the next 5 years. This will expand our reach and scope, and enable us to dominate these core international routes," he also said.
At the same time, Malaysia Airlines will further develop its hub and spoke network to improve traffic flow in Europe, Australia and New Zealand.
"We are moving from a ‘point-to-point’ towards a ‘hub and spoke’ network. That’s the best way for us to grow profitably in these regions. We have already signed on new partners such as KLM, Gulf Air and Virgin Blue, Australia which gives us access to many points in Europe, Middle East and Down Under.
"In the next couple of weeks, we will sign code-share agreements that will give us access to many Southern European points. More agreements are in the pipeline," he added.
The new network will also see routes in the Middle East restructured, while flight frequencies to non-trunk markets such as North America, South America and South Africa will remain unchanged.
To offer services to new destinations within its core network, Malaysia Airlines will be acquiring new aircraft either through purchase or lease.
Mr Jala said, "We are looking at acquiring long range narrowbody aircraft which will allow us to operate the new routes profitably where our A330 is too large and our Boeing 737-400 does not have the range. Part of the proceeds of our RM1.5 billion rights issue and RCPS will go towards acquiring these new aircraft and replacing some of our existing ones.""
The Firefly community airline will be playing a key role in the network plan.
"Firefly will break new grounds for us by serving destinations which are not financially viable for Malaysia Airlines. It will capture a new market segment, and enable us to grow from both the full service passenger and the budget traveler markets. We will have the best of both worlds," he also said.
Commencing Monday, 2 April, Firefly will offer 14 weekly flights to Kota Bahru, Kuantan, Kuala Terengganu, Langkawi and 7 weekly flights to Phuket and Koh Samui, from Penang.
