The Government is studying four separate proposals by companies to give life back to struggling national carrier Malaysia Airlines Bhd, local media has reported.
And contrary to popular belief, the world’s best low-cost airline AirAsia is not one of them.
The Star quoted Prime Minister Mahathir Mohamad as saying at the launch of TVET Conference 2019 on Tuesday (July 9) that Malaysia Airlines (MAS) had undergone “several management changes in the past” but did not see much success.
He also said his administration had received four proposals or offers – mostly from local companies – to turn around the ailing airline, one of which is from a group headed by Datuk Pahamin Ab Rajab, the former director-general of the Road Transport Department and former non-executive chairman of AirAsia Bhd.
The group’s offer purportedly has proof of funding and contain plans to claim a 49 per cent stake in the company.
Meanwhile, AirAsia Group CEO Tony Fernandes has denied any involvement with Malaysia Airlines, saying that the budget carrier is instead more interested in “growing organically” and accelerating efforts to become a “digital enterprise”, South China Morning Post (SCMP) reported.
When asked about his interest with Malaysia Airlines, Fernandes reported said: “I am not sure how many languages I have to say it in. I am on this big journey of transforming AirAsia. AirAsia is focused on AirAsia.”
Many unsuccessful attempts to revive airline
According to The Star, Dr Mahathir noted that there were “a lot of ideas” from the proposals, with some parties offering to buy or manage the airlines.
However, even though the Government would be going through all the proposals, he expressed concerns about the ability of corporate suitors to run the business and manage its losses, according to Malay Mail. He said although many had been appointed to take the helm in the past, “all of them proved unable” to rejuvenate the airline.
The Government itself had attempted four times to revive the airline but was not successful, according to the report.
Furthermore, Dr Mahathir said the airline’s prospects were under threat by the popularity of low-cost carriers.
Resolving Malaysia Airline’s financial turmoil has shown to be an uphill battle.
Earlier this year, the airline accounted for only half of the RM7.3 billion (US$1.76 billion) impairments reported by sovereign wealth fund Khazanah Nasional Bhd, which it is privatised under.
The fund also previously pumped RM6 billion into the airline, including RM1.6 billion to delist it from the stock exchange and another RM1.6 billion on restructuring and retrenchment.
Khazanah managing director Shahril Ridza Ridzuan reportedly said Malaysia Airlines had failed to break even last year, citing overcapacity and oversupply in the aviation industry as well as Malaysians’ preference for low-cost carriers as the main reasons for its inability to flourish.
He also added that continued investment in the carrier would need to be “carefully considered”.
- Singapore Airlines will partner Malaysia Airlines to offer more code-share flights around the world
- After complaining, Defence Minister Mat Sabu says he’ll still fly Malaysia Airlines because he’s a loyal customer
- Malaysia Airlines is still well-loved by Malaysians – but not quite by Singaporeans and Hong Kongers