(MENAFN- Bangladesh Monitor) Kuala Lumpur : Malaysia Airlines Berhad (MAB) is seeking approval for a revised turnaround plan aimed at better aligning its business strategy and fleet to address financial and market challenges.
The airline submitted its proposed plan to Khazanah Nasional Berhad, the government's sovereign wealth fund, Izham Ismail, CEO, MAB announced on the sidelines of the recent IATA AGM in Seoul. Khazanah became the sole owner of MAB following a government bailout in 2014.
The carrier has been following a multiyear turnaround plan since the takeover but has not met targets for a return to profitability. The government has voiced its frustration with the airline's progress and Prime Minister Mahathir Mohamad said he is considering a range of options, including refinancing or selling the carrier.
MAB put together a new framework, which was approved by the airline's board in February. It was then sent to Khazanah, and the plan is expected to be considered by the fund's board later in June or early July.
The carrier's fleet plan will be part of the proposal. While Izham would not reveal details, he confirmed "there is some element of fleet restructuring." Last year MAB needed to order widebody aircraft to begin the replacement of its Airbus A330s, but it is not clear if such a move will be part of the airline's revised plan.
MAB has made progress in areas such as passenger product, customer satisfaction and on-time performance, but financially this year will once again be "very challenging," Izham said. The Malaysian domestic market has a capacity oversupply, and volatility of fuel costs and foreign exchange rates will have an effect. In addition, international trade disputes are hurting the cargo division, which is "under duress at the moment."
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