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Airlines

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Name: MALAYSIA AIRLINES BERHAD
7JetSet7 Code: MAS
Status: Operational
Region: ORIENT
City: KUALA LUMPUR
Country: MALAYSIA
Employees 19423
Web: malaysiaairlines.com.my
Email: tanwf@mas.com.my
Telephone: +60 378433000
Fax: +60 378473171
Sita: KULDZMH
Background
(definitions)

Click below for data links:
MAS-2003-11-A
MAS-2003-11-B
MAS-2003-11-C
MAS-2003-11-D
MAS-2004-01 WLDTOP25-2003
MAS-2004-07 1ST6MTHS-2004
MAS-2004-07-NEWS
MAS-2005-01 2004 STATS
MAS-2005-01 2004-WORLD-RPK
MAS-2005-01 NEWS A380
MAS-2005-05-747
MAS-2005-09-NEWS-A
MAS-2006-012005 TOP-RPK
MAS-2006-02-NEWS-A
MAS-2006-07-NEWS-A
MAS-2008-01 2007-STATS
MAS-2009-11 NEWS
MAS-2012-03 - A380 PROGRESS
MAS-2012-06 - A380 DELIVERY
MAS-2012-07 1ST A380
MAS-2012-10 - 40 YEARS
MAS-2012-12 - NEW LIVERY
MAS-2013-02 - NEW ONEWORLD MEMBER
MAS-2013-03 - TOP 12 MKTS
MAS-2013-03 - TOP 15 ROUTES
MAS-2013-11 - PUERTO PRINCESA
MAS-2014-02-KRABI-KUALA LUMPUR
MAS-2014-02-NEW ORDERS
MAS-2014-06-RESTRUCTURE
MAS-2015-03 - ARINC MULTILINK MAP.jpg
MAS-2015-07 - MH370 Debris-A.jpg
MAS-2015-07 - MH370 Debris-B.jpg
MAS-2015-07 - MH370 Debris-C.jpg
MAS-2015-10 - 777 Hit by BUK Missile.jpg
MAS-2015-12 - Flight MH17 ACCDT.jpg
MAS-2016-03 - 777 MH370 Debris.jpg
MAS-2017-09 - 737 MAX to 787-9.jpg
MAS-Flight Crew Cabin Attendants-2012-12.jpg
MAS-LOGO
MAS-MAINTENANCE MRO
MAS-TAIL LOGO
MAS-VISIT KUALA LUMPUR
MAS-VISIT KUALA LUMPUR-2011-08

ORIGINATED IN 1937 AND STARTED OPERATIONS IN 1947 AS MALAYSIA-SINGAPORE AIRLINES. PRESENT AIRLINE FORMED IN 1971 ON BREAKUP OF MALAYSIA-SINGAPORE AIRLINES (MSA). NATIONAL FLAG CARRIER. SCHEDULED & CHARTER, DOMESTIC, REGIONAL & INTERNATIONAL, PASSENGER & CARGO, JET AIRPLANE SERVICES.

ADDRESS:
JALAN SULTAN ISMAIL
33RD FLOOR, BANGUNAN MAS
50250 KUALA LUMPUR, (SELANGOR), MALAYSIA

MALAYSIA (FEDERATION OF MALAYSIA) WAS ESTABLISHED IN 1957, IT COVERS AN AREA OF 329,749 SQ KM, ITS POPULATION IS 21 MILLION, ITS CAPITAL CITY IS KUALA LUMPUR, AND ITS OFFICIAL LANGUAGE IS MALAY.

Cheap living, terrific beaches and an interesting combo of cultures make Malaysia an intriguing choice for retirement. There are some tax breaks for the wealthy. Status as a developing Third World nation means retirees should stay near capital of Kuala Lumpur for health care. SEE ATTACHED - - "MAS-KUALA LUMPUR-2011-08."

DECEMBER 1993: MALAYSIA AIRLINES (MAS) OWNS MALAYSIAN HELICOPTER SERVICES (MHS) WHICH OWNS 20% WORLD AIRWAYS (WLD), 18% PELANGI AIR, & 66.7% OF AEROSPACE INDUSTRIES OF MALAYSIA (AIM), WHICH OWNS 34% OF AIROD MAINTENANCE & OVERHAUL (+19% IN DECEMBER 1995), 44% DUTCH SCHREINER HELICOPTER AVIATION, 49% AIR MALDIVES (MLD), AND 40% ROYAL AIR CAMBODGE (RAB).

PEMCO AEROPLEX TO CONVERT A NEW 737-300 TO FREIGHTER CONFIGURATION.

HONEYWELL GLOBAL NAVIGATION SYSTEM (GNS) SELECTED FOR 10/6 ORDERS A330'S.

FEBRUARY 1994: LAST 6 MONTHS 1993 = +$3 MILLION (NET PROFIT) (-94%): -1.6% PASSENGERS (PAX).

1 737-400 DELIVERY.

MARCH 1994: 747-4H6 (RT749) DELIVERY.

JULY 1994: 2 737-300'S DELIVERIES.

AUGUST 1994: 19,783 EMPLOYEES (INCLUDING 3,127 FLIGHT CREW (FC) & 2,363 MAINTENANCE TECHNICIANS (MT)).

10 ORDERS A330'S (PW4168) LAUNCH CUSTOMER, DELAYED UNTIL MARCH 1995.

SEPTEMBER 1994: TAJUDIN RAMLI TAKES OVER AS CHAIRMAN (EX-FOUNDER & CHAIRMAN OF MALAYSIAN TELECOMMUNICATIONS GIANT, TECHNOLOGIES RESEARCH INDUSTRIES & HIS HOLDING COMPANY, MALAYSIAN HELICOPTER SERVICES) WHICH PAID $700 MILLION FOR 32% CONTROLLING INTEREST IN MALAYSIA AIRLINES (MAS). HE MADE THE FOLLOWING TECHNICAL MANAGEMENT CHANGES: WAN MALEK IBRAHIM, MANAGING DIRECTOR; NOOR AMIRUDDIN M NORDIN, DIRECTOR ENGINEERING; RAMLI MAT ADI, ENGINEERING PLANNING MANAGER; TAJUDEN ABU BAKER, LINE MAINTENANCE MANAGER; AHMAD ZAHIR, BASE MAINTENANCE MANAGER; KUA SAI LING, QUALITY ASSURANCE MANAGER; K JEYAKANTHAN, ENGINEERING MARKETING & SALES MANAGER; & ROSLAN ISMAIL, PROJECTS MANAGER.

APRIL 1995: FISCAL YEAR (FY) ENDING MARCH 1995 = +$57.9 MILLION (NET PROFIT): +19.3% (RPK) PASSENGER TRAFFIC, +19.2% (ASK) CAPACITY, +67.3% (FTK) FREIGHT TRAFFIC, 69.8% LF LOAD FACTOR.

2 A300B4-203'S (CF6-50C2) DELIVERIES.

SEPTEMBER 1995: THREATENS TO BOYCOTT AIRBUS (EDS), UNLESS MALAYSIA AIRLINES (MAS) GETS 2/DAY FLIGHTS TO FRANCE, INSTEAD OF PRESENT 3/WEEK. NOW HAS 8 A330'S (LARGEST NUMBER IN ASIA).

737-4H6 (27191) LEASED TO (UKL). 1 DC-10-30 (CF6-50C2), EX-(LOT) POLISH AIRLINES.

NOVEMBER 1995: CODE SHARE WITH CANADIAN INTERNATIONAL (CDI) TO TAIPEI - VANCOUVER (747-400). NEW ROUTES: OSAKA KANSAI (747-200F), PENANG, DUBAI, AMSTERDAM, CHICAGO (MD-11F).

777 PRELIMINARY CONFIGURATION DISCUSSIONS. POSSIBLE +10 ORDERS 747-400'S & 15 ORDERS 777'S. 1 A330-300 (PW4168) DELIVERY. 2 ORDERS (JANUARY 1996) A330-322'S (PW4168) (ILF) LEASED.

JANUARY 1996: $4 BILLION, 10/2 ORDERS (1997) 747-400'S & 15/3 ORDERS (1997) 777-200/-300'S (RR TRENT). ALSO 35 "FLOATING" OPTIONS OF 777-100X'S & 747-500/-600'S. 10TH A330-300 (PW4168) DELIVERY.

APRIL 1996: FISCAL YEAR (FY) 1995 ENDING MARCH 1996 = +$93.9 MILLION (+67%): 62% LF LOAD FACTOR (-2).

2 DC-10-30'S (46955; 48282) LEASED TO WORLD AIRWAYS (WLD).

JUNE 1996: SEPARATES TECHNICAL SIDE OF AIRLINE INTO A NEW "PROFIT CENTER" (MAS) AEROTECHNOLOGIES WITH PRESIDENT, NOOR AMIRUDDIN M NORDIN.

KUA SAI LING, BECOMES HEAD OF AVIATION AND AEROSPACE TRAINING ACADEMY.

WITH NEW ROUTES TO MALDIVES (A330) AND VIENTIANE (CAMBODIA) (737), MALAYSIA AIRLINES (MAS) NOW FLIES TO 114 INTERNATIONAL DESTINATIONS.

JULY 1996: QUALITY ASSURANCE IS RESPONSIBLE FOR DEVELOPING THE MALAYSIA AIRLINES (MAS) MAINTENANCE OPERATIONS SPECIFICATION AND GETTING REGULATORY AUTHORITY APPROVAL.

CURRENTLY DOES NOT PLAN TO EXPAND EXISTING COMPUTER SYSTEM TO UTILIZE DIGITAL DATA, HOWEVER, WANTS 777 MAINTENANCE PLANNING DOCUMENT (MPD) IN DIGITAL FORM TO SAVE SIGNIFICANT MANHOURS OVER MANUAL LOADING INTO THEIR PERSONAL COMPUTERS (PC)'S (AS STATED IN 777 PROGRAM DIRECTIVE). TO COMPLY, "DIGITALLY" MEANS THE MANUFACTURER SUPPLIES (MAS) WITH A "FLOPPY" WHICH THEY CAN EDIT WITH THEIR PC'S.

SEAGA AIRLINES (SGA), BASED IN SABAH, EAST MALAYSIA, HAS BEEN DESIGNATED BY GOVERNMENT AS NATIONAL CARRIER, WITHIN EAST ASIA GROWTH AREA (EAGA). TAN SRI TING PEK KHIING (SGA) CHAIRMAN, SAID THEY ARE CONSIDERING ACQUIRING WIDE BODIES.

(MAS) IS INTERESTED IN ACQUIRING UNISYS SOFTWARE CALLED "CUSTOMER MANAGEMENT SYSTEM (CMS)" TO AMASS IMPORTANT, CURRENT AND COMPLETE CUSTOMER INFORMATION ON A DATABASE. THE ONLY OTHER AIRLINE IN THE REGION TO BUY THIS IS ANSETT (ANS).

(MAS) IS PLANNING A NEW HANGAR AT SUBANG FOR COMPLETION 8/97, WHICH
CAN HANDLE NEW 747-600'S.

NEGOTIATING FOR FEDEX (FED) 25 MD-11'S.

SEPTEMBER 1996: SAEAGA AIRLINES (SGA) MALAYSIAN DOMESTIC CARRIER, MAKES 10 ORDERS 737-700'S.

TAN SRI TING PEK KHIING (SGA) CHAIRMAN, FOR INTERNATIONAL ROUTES TO TAIWAN AND AUSTRALIA.

MALAYSIA'S 2ND NATIONAL CARRIER, AIR ASIA (ASW), TO START OPERATIONS IN NOVEMBER 1996 WITH 3 INTERNATIONAL DESTINATIONS, PATTAYA (THAILAND), SUBIC BAY (PHILIPPINES) & KAOHSIUNG (TAIWAN), WITH 2 LEASED 737-300'S, AND TO LATER BECOME PACIFIC EAGLE AIRLINES.

OCTOBER 1996: CODE SHARE WITH LAUDA AIR (LAL) TO VIENNA (747).

PACT WITH (GE) TO BUY 70% OF AIRCRAFT ENGINE REPAIR OPERATIONS (AERO) AND TAKE OVER MANAGEMENT FUNCTIONS AS REGIONAL OVERHAUL FACILITY FOR (CFM56), & (PW4000) ENGINES, AND (APS2000) (APU)'S.

TO INVEST $79 MILLION TO BUILD A 737 MAINTENANCE FACILITY IN MYSORE, INDIA BY 1998.

13TH 747-400 (9M-MPI) DELIVERY (16 HOURS, 22 MINUTES, NON-STOP). 2 DC-10-30'S (CF6-50C2), WORLD (WLD) WET-LEASED 32 MONTHS. 1 A330 DELIVERY.

DECEMBER 1996: JOINT CARGO OPERATION WITH JAPAN AIRLINES (JAL) USING 747-200F FOR PENANG, NARITA, AND KANSAI. TO TAKE OVER PELANGI AIR (PLG).

JANUARY 1997: NEW LOGO DESIGNED FOR 50TH YEAR ANNIVERSARY IN APRIL 1997.

TO YANGON, MYANMAR (737) AND NEW ROUTES TO SHANGHAI, XIAMEN, AND SHENZHEN.

FEBRUARY 1997: (PW4056) FOR 10 ORDERS 747-400'S & (TRENT 800) $500 MILLION (RR) ORDER FOR 777'S. MAINTENANCE CONTRACT FOR AIR MICRONESIA (MCR) 727-200'S.

MARCH 1997: 1 737-400 DELIVERY. MEMO OF UNDERSTANDING (MOU) 15 777-200X'S, 8,500 NM.

APRIL 1997: 50TH ANNIVERSARY!

19,616 EMPLOYEES (INCLUDING 3,127 FLIGHT CREW (FC) & 2,363 MAINTENANCE TECHNICIANS (MT)).

1ST FLIGHT TO SHANGHAI (3RD IN CHINA & 116TH WORLDWIDE).

EXTENDED TWIN-ENGINE OPERATIONS (ETOPS) ON HOLD UNTIL AIRWORTHINESS DIRECTIVE (AD) ACCOMPLISHED FOR REDESIGNED ENGINE PARTS DUE TO 10 OIL LOSS & 1 BEARING FAILURE ON ROLLS ROYCE (RRc) (TRENT 800) ENGINES.

777 (12F, 33C, 233Y PAX) DELIVERY. NOW IS THE LARGEST BOEING (TBC) OPERATOR OUTSIDE THE USA. Malaysia Airlines (MAS) signed a Memo of Understanding (MOU) for the purchase of up to 15 of the proposed 777-200Xs, according to Executive Chairman, Tajudin Ramli. The airplane, which has not been launched formally by Boeing (TBC), features increased range and Maximum Take Off Weight (MTOW) over the 777-200IGW. Ramli went on to say the new airplane and the advent of "open skies" between Malaysia and the USA, will allow the carrier "nonstop capability from Kuala Lumpur to New York, Los Angeles and Chicago." Ramli's remarks come as (MAS) faces public criticism and new competition from startup AirAsia (ASW). (MAS) no longer will get priority on landing rights obtained by the government, Transport Minister Ling Liong Sik said. "We cannot say that all future landing rights belong to (MAS) and that nobody else should have them except (MAS)."

MAY 1997: 737-400 DELIVERY. 2 737-4H6'S SOLD TO JET AIRWAYS (JPL). MASKARGO 707-331C (20069) RETURNED TO LESSOR.

JUNE 1997: FISCAL YEAR (FY) 1996 = +$139.6 MILLION (NET PROFIT).

2ND 777-200 DELIVERY. 2ND 777 STARTS MUNICH, VIENNA, PARIS, ROME AND
PERTH.

RECEIVES 120 MINUTES (ETOPS) APPROVAL.

JULY 1997: TO CAIRO (NOW, 79 DESTINATIONS).

4TH 777 DELIVERY.

AUGUST 1997: 2 737-4H6'S (26452; 26453) RETURNED FROM (RAB).

SEPTEMBER 1997: CODE SHARE WITH SWISSAIR (SWS), TO ZURICH (777). NEW ROUTE TO (VIENNA) - ZAGREB. PLANS TO ADD BELGRADE, PRAGUE, AND SARAJEVO.

PRIME MINISTER, DR MOHD MAHATHIR, TO USE 777 FOR STATE VISIT TO KYRGYZSTAN & MONGOLIA, INSTEAD OF A330, BECAUSE OF SUPERIOR COMFORT LEVEL AND RELIABILITY, 4 DAYS AT EACH.

ROOF FITTED ON NEW HANGAR TO MAKE IT CAPABLE OF HANDLING 2 747'S & 1 737.

OCTOBER 1997: 15,766 EMPLOYEES.

USING ITS EXTENDED TWIN-ENGINE OPERATIONS (ETOPS) EXPERIENCE ON A330 (TRENT 892), NOW OPERATES 120 MINUTES 777 (ETOPS) TO PERTH (PER)/PARIS CHARLES DE GAULLE (CDG)/MUNICH (MUC)/VIENNA (VIE).

NOVEMBER 1997: FREIGHTER SERVICE CODE SHARE WITH VIRGIN ATLANTIC AIRWAYS (VAA), LONDON HEATHROW - KUALA LUMPUR - MELBOURNE/OSAKA - KANSAI (MD-11F). TO ZAGREB, VIA VIENNA, (777). CODE SHARE WITH CROATIA (CRH).

747-400 LANDS AT NEW KUALA LUMPUR INTERNATIONAL AIRPORT AT KLIA, TO BE COMPLETED BY APRIL 1998.

2 737-4Q8, PEGASUS (PGS) WET-LEASED TIL APRIL 1998.

DECEMBER 1997: 1ST ASIAN CUSTOMER FOR 737 BBJ ($40 MILLION).

CAIRO BECOMES 116TH DESTINATION (A330).

JANUARY 1998: PLANS ALLIANCE WITH (KLM) TO AMSTERDAM.

PLANS TO SELL 4 DC-10'S & 1 A300. 1 777-200 IGW (TRENT 892B) DELIVERY.

MARCH 1998: TO DUBAI - NEWARK (777-200).

PHIL CONDIT, BOEING (TBC) CHAIRMAN SIGNS CONTRACT WITH 4 MALAYSIAN PARTNERS INCLUDING MALAYSIA HELICOPTERS (PARENT COMPANY OF MALAYSIA AIRLINES (MAS) FOR MANUFACTURE OF COMPOSITE SUB-ASSEMBLY PARTS FOR BOEING AIRPLANES TO EMPLOY 300 MALAYSIANS.

"D" CHECK MAINTENANCE CONTRACT FOR (KLM) DC-10-30 LEASED TO AFRICAN SAFARI AIRWAYS (AFS), INCLUDING SEVERAL LARGE MODIFICATION PROGRAMS.

LEASES 2 737-400'S TO AIR MALTA (MLT) FOR 8 MONTHS. 1 747-400 AND 6TH 777 DELIVERIES.

APRIL 1998: JOINT VENTURE WITH ALLIED SIGNAL FOR REPAIR & OVERHAUL OF 85 SERIES (APU)'S. RETROFITS ALL 737'S (APU)'S.

MEDIA REPORTS SAY DUE TO SOUTH EAST ASIAN ECONOMIC CRISIS, MALAYSIA AIRLINES (MAS) IS LOSING -$55 MILLION /MONTH.

23,524 EMPLOYEES (INCLUDING 1,223 FLIGHT CREW (FC) & 1,931 MAINTENANCE TECHNICIANS (MT)).

2 747-400'S DELIVERIES. SELLS 777-200 IGW (28411) TO SALE & LEASES BACK FOR 12 YEARS.

MAY 1998: 7TH 777 DELIVERY.

JUNE 1998: NEW KUALA LUMPUR INTERNATIONAL AIRPORT OPENS, 40 MINUTES FROM TOWN AND 55 MINUTES FROM MALAYSIA AIRLINES (MAS) ENGINEERING OFFICES AT THE OLD SUBANG LOCATION.

(MAS) BEGINS SERVICE FROM NEW SULTAN ABDUL AZIZ SHAH INTERNATIONAL AIRPORT.

FISCAL YEAR (FY) 1997 = -$80.7 MILLION.

WILL DELAY DELIVERIES OF 9 747-400'S AND 777-200'S BY 36 MONTHS AND SELL 4 737'S. 2 A330-300'S TO BE RETURNED TO (ILF) IN NOVEMBER 1998 & 1999. MEMO OF UNDERSTANDING (MOU) SALE 2 747-400'S TO QANTAS AIRWAYS (QAN).

JULY 1998: IN 1999, TO EXPAND TO MANILA, HONG KONG, AND JAKARTA. TECHNICAL SUPPORT BY MALAYSIA AIRLINES (MAS). CODE SHARE WITH SWISSAIR (SWS) TO ZURICH MAY EXTEND TO CARGO.

"BUSINESS TRAVEL WORLD" MAGAZINE AWARDS MALAYSIA AIRLINES (MAS) "BEST ASIAN BUSINESS AIRLINE" FOR 3RD YEAR IN A ROW.

1997 TOP WORLD AIRLINE COMPARISONS:
EMPLOYEES (K): 17 AIN 23; 18 IBE 22; 19 SAS 22; 20 ACN 22; 21 TII 22; 22 PIA; 23 AIN 19; 24 ALI 19; 25 VAR 18; 26 JAL 17; 27 KAL 17; 28 ANS 17; 29 SWS 17; 30 GUN 16.0; 31 MAS 15.8.

(RPK) (TRAFFIC) (B): 16 TWA 41; 17 KAL 40; 18 CAT 39; 19 ACN 37; 20 ALI 36; 21 TII 31; 22 MAS 29; 23 IBE 28; 24 SWS 28; 25 AMW 26.

TO WET-LEASE 2 747-400 COMBI'S TO NEW SRI LANKAN OPERATOR "PEACE AIR" STARTING OPERATIONS IN 9/98 TO KUALA LUMPUR, SINGAPORE, AND BANGKOK. 8TH 777 DELIVERY, AFTER 15 HOUR, 33 MINUTES NONSTOP, FROM SEATTLE.

AUGUST 1998: "D" CHECK ON WINAIR (WII) 737-200 (22703), EX-EAST WEST (BOM).

ALL 737'S LEASED TO JET AIRWAYS (JPL) TO BE RETURNED DUE TO GOVERNMENT RESTRICTIONS ON FOREIGN AIRLINE ISSUE. WITH DWINDLING ASIAN TRAFFIC, IS TRYING TO DISPOSE OF 10 A330-300'S (TO LEASE OUT) AND RETURN 2 TO LESSOR. CURRENTLY USED ON DOMESTIC & REGIONAL SHORT- TO MEDIUM-RANGE ROUTES. IF LEASES ARE ARRANGED, 737-400'S WILL TAKE OVER THE SHORT RANGE & 777-200'S THE MEDIUM-RANGE ROUTES.

SEPTEMBER 1998: IN JULY 1999 TO MANCHESTER, ENGLAND (777-200) TO ESTABLISH ITSELF FOR COMMONWEALTH GAMES IN 2002, VIA MUNICH, BOTH DIRECTIONS.

747-4H6 (858-25126) SOLD TO QANTAS AIRWAYS (QAN). 737-5H6 (26454) WET-LEASED TO ANGEL AIRLINES (ANE). SELLS 2 737-4H6'S TO MITSUI AIRCRAFT LEASING. 2ND 737-4H6 LEASED TO SHAHEEN AIR (SHK). 737 FLEET TRIMMED FROM 54 (18 MONTHS AGO) TO 31, WITH 13 SOLD, AND REMAINDER LEASED OUT.

OCTOBER 1998: MOVES ALL DOMESTIC FLIGHTS BACK TO "OLD" SULTAN ABDUL AZIZ SHAH AIRPORT, EXCEPT IPOH, BECAUSE PASSENGERS COMPLAINED OF LONG WAY TO NEW AIRPORT, FOR TAKING A SHORT DOMESTIC FLIGHT.

THE NEW AIRPORT IS INFESTED WITH RATS, FROM THE NEARBY JUNGLE, AND ARE EVEN FINDING THEIR WAY ON-BOARD MALAYSIA AIRLINES (MAS) AIRPLANES. ONE TRAPPING EXERCISE CAUGHT 600 IN A SINGLE DAY.

FISCAL YEAR (FY) 1997 = -$67.6 MILLION (+$84.83 MILLION).

A330-322 (143) RETURNED TO (ILF), NOW LEASED TO (LTU), GERMANY. 9TH 777-200 DELIVERY.

NOVEMBER 1998: 737-4H6 (27353) RETURNED FROM AIR MALTA (MLT).

DECEMBER 1998: 2 737-5H6'S (26445; 26446) RETURNED TO GECAS (GEH). SOLD 11 737'S FOR TOTAL 43 LEFT. OFFERS 1 747-300 (JT9D-7) AND 2 747-400'S COMBI (CF6) FOR SALE THROUGH FORTIS AVIATION (FOS).

JANUARY 1999: TO LAY OFF -6,000 (-27%) OF EXISTING 21,882 EMPLOYEES, INCLUDING RECALL OF 1,100 STATIONED ABROAD.

IN APRIL 1999 TO RESTRUCTURE INTO 4 DIVISIONS: VIRTUAL AIRLINE; PHYSICAL AIRLINE; SHARED SERVICES; & DERIVATIVE BUSINESS. VIRTUAL = RESERVATIONS, TRAFFIC, SALES & MARKETING, PASSENGER SERVICES, CARGO OPERATIONS, SECURITY, & TICKETING; PHYSICAL = SCHEDULE PLANNING, FLIGHT OPERATIONS, ENGINEERING AT KUALA LUMPUR INTERNATIONAL AIRPORT SEPANG, & FLIGHT MANAGEMENT CENTER; SHARED = HUMAN RESOURCES & FINANCE; DERIVATIVE = CATERING, ASSET MANAGEMENT, & HEAVY MAINTENANCE AT SULTAN ABDUL AZIZ SHAH AIRPORT. ASSET MANAGEMENT WILL TAKE OWNERSHIP OF ALL AIRPLANES & LEASING.

RAZALI HARUN, FORMER FLIGHT ENGINEER, VP ASSET MANAGEMENT GROUP (AMG).

TOOK DELIVERY OF 1 747-400 & 2 777-200'S, & SOLD 1 747-400 & 1 DC-10-30. REPOSSESSES 737-4H6 (27384) FROM SHAHEEN (SHK) FOR NON-PAYMENT OF LEASE SINCE OCTOBER 1998 ($840,000). 737-5H6 (27355), RETURNED TO (GEH), LEASED TO JET AIRWAYS (JPL).

FEBRUARY 1999: CODE SHARE WITH PHILIPPINE AIRLINES (PAL), KUALA LUMPUR, KOTA KINABALU, KUCHING, TO CEBU AND MANILA.

WAN MALEK WAN IBRAHIM, MANAGING DIRECTOR RETIRES.

SOLD DHC-6-300 (791) TWIN OTTER TO DODSON AVIATION (DSN).

MARCH 1999: STARTS EARLY FLIGHTS TO MANCHESTER, UK (777), VIA MUNICH (112TH DESTINATION).

CHAIRMAN DECIDES NOT TO LAY OFF 6,000 EMPLOYEES - WANTS THEM TO WORK "LEAN."

MASKARGO (2 747-200F/2 MD-11F) SELECTS HAHN AIRPORT, LAUTZENHAUSEN,
70M WEST OF FRANKFURT, GERMANY, AS ITS EUROPEAN HUB, 4 FLIGHTS/WEEK.

LEASES 2 737-4H6'S (27673; 27674) TO AIR MALTA (MLT) TIL NOVEMBER 1999. DECIDES TO SELL 1 737-300F, 1 747-300 COMBI, 2 747-400'S COMBI AND 10 A330'S. (LOI) BY ATCHLEY & ASSOCIATES, TENNESSEE, TO BUY 2 737-400'S (27353; 27384).

APRIL 1999: MALAYSIA AIRLINES (MAS) ACADEMY (MAA) GAINS (ISO) 9001 CERTIFICATION.

3RD PARTY MAINTENANCE FOR 737'S OF ISTANBUL (IST), ANSETT (AWW), JET
AIRWAYS (JPL) AND PLM INTERNATIONAL.

$135 MILLION ENHANCEMENT OF 747/777 INTERACTIVE IN-FLIGHT ENTERTAINMENT (IFE), INCLUDING IN-SEAT FAX SERVICE.

23,309 EMPLOYEES. SITA: KULDZMH. KULWPMH.

(http://www.malaysia-airlines.com.my).

JUNE 1999: FISCAL YEAR (FY) 1998 = -$184 MILLION, DUE TO WEAK CURRENCY AND FOREIGN EXCHANGE LOSSES, PLUS DECLINE IN TRAFFIC, PARTICULARLY IN DOMESTIC, SINGAPORE AND REGIONAL MARKETS.

CODE SHARE WITH UZBEKISTAN AIRWAYS (UZB) TO TASHKENT.

DC-10-30 (234) SOLD TO GHANA AIRWAYS (GHN). POSSIBLE SALE OF 2ND (159). 2ND LEASED A330 RETURNED TO AIRBUS. 10TH 777-2H6 (9M-MRJ) DELIVERY (28417).

1998 TOP WORLD AIRLINES TRAFFIC (RPM) (BILLION):
17 TWA 24.42; 18 ACN 23.21; 19 ALI 22.10; 20 TII 21.34; 21 IBE 20.19; 22 KAL 19.95; 23 MAS 18.25; 24 SWS 17.43; 25 CDI 16.70; 26 AMW 16.36; 27 VAR 16.25; 28 SAS 12.98; 29 CHI 12.64; 30 VAA 12.23.

JULY 1999: SOLD 3 777-200'S (28409; 28410; 28413) TO (GEH), & LEASED BACK.

AUGUST 1999: 1998 = -$179.8 MILLION (-$69.8 MILLION): 18.25 BILLION (RPM) TRAFFIC (+2.1%), 2.59 BILLION (FTM) FREIGHT TRAFFIC (-.2%).

DC-10-30 SOLD TO TRANSASIAN, WITH ALENIA AERONAVALI TO CONVERTED TO FREIGHTER.

AUGUST 1999: TAJUDEN ABU BAKAR, VP AIRCRAFT MANAGEMENT REPLACES ARIFIN ISMAIL, WHO RETIRED AFTER 35 YEARS.

11TH 777-200 (28418, 9M-MRK) DELIVERY.

SEPTEMBER 1999: PLANS TO SELL ITS STAKES IN AIR MALDIVES (MLD) & ROYAL AIR CAMBODGE (RAB).

CODE SHARE WITH TURKISH (THY) TO ISTANBUL VIA DUBAI (A310/A330) & WITH NORTHWEST AIRLINES (NWA) TO LOS ANGELES (LAX) AND TO DETROIT IN JANUARY 2000.

OCTOBER 1999: IN NOVEMBER 1999, CODE SHARE WITH KOREAN AIR (KAL) TO SEOUL NONSTOP.

2 ORDERS (JANUARY 2001) 777-200ER'S (TRENT 892), S A L E (SIL) LEASED. SOLD 2 OTHER 777-200ER'S TO (SIL) AND LEASED BACK. HAS CONTRACT WITH (SIL) TO REMARKET 2 747-400'S.

NOVEMBER 1999: CODE SHARE WITH ROYAL BRUNEI AIRLINES (RBA) TO BANDAR
SERI BEGAWAN.

3 747-200F'S & 1 747-400F, ATLAS AIR (TLS) WET-LEASED FOR MASKARGO OPERATIONS. 737-7H6, BBJ DELIVERY.

DECEMBER 1999: 737-3H6F (27125, 9M-MZA) OPERATES FOR TRANSPAC EXPRESS. 2ND DC-10-30 (46933) LEASED TO GHANA AIRWAYS (GHN). 737-4H6 (27085) RETURNED FROM ANGEL AIRLINES (ANE).

JANUARY 2000: MASKARGO SWITCHES ITS EUROPEAN HUB FROM HAHN TO MAASTRICHT.

FEBRUARY 2000: MASKARGO HAS 2 737-300C'S & 5 747F'S TO GROW PAYLOAD FROM 65% TO 74%.

CODE SHARE WITH GARUDA INDONESIAN (GIA) TO JAKARTA.

EXPECTS 45/17 ORDERS A320'S (CFM56) FAMILY TO REPLACE 737-400/-500'S, +10 ORDERS A340-500 & 8 A340-600'S TO REPLACE 747'S. FINANCING & SUB-CONTRACT WORK MAY DELAY FORMAL ANNOUNCEMENT UNTIL MID 2000.

MARCH 2000: TO VIENNA - MUNICH (777).

NOW EXPECTED TO ORDER 20 777-200LR/-300ER'S. A330-300, (9M-MKB) GROUNDED AT KUALA LUMPUR AFTER CARGO OF CORROSIVE & POISENOUS HYDROXY QUINOLENE LEAKED AFTER LANDING, WHICH COULD RESULT IN WRITE-OFF (W/O) OF AIRPLANE.

APRIL 2000: TAJUDIN RAMLI, CHAIRMAN, WHO HOLDS 29% OF MALAYSIA AIRLINES (MAS), THROUGH HIS COMPANY NALURI, PLANS A PARTIAL OR WHOLE SALE AS PART OF (MAS)'S DEBT RESTRUCTURING SCHEME.

22,800 EMPLOYEES (INCLUDING 1,300 FLIGHT CREW (FC), 4,300 CABIN ATTENDANTS (CA), & 1,220 MAINTENANCE TECHNICIANS (MT)).

REPOSSESSED 2 737-500'S FROM ANGEL AIRLINES (ANE) DUE TO NON-PAYMENT OVER LAST 3 MONTHS. 1 A300B4-203F (147), RETURNED FINOVA (GRB), LEASED TO CHANNEL EXPRESS (CXP).

MAY 2000: 1 747-4H6 DELIVERY. PLANS TO RETURN 2 ORDERS 777'S BACK TO SALE LEASING (SIL).

JUNE 2000: (FAA) AUDIT BEING CONDUCTED.

CODE SHARE WITH MIDDLE EAST AIRLINES (MEA) TO BEIRUT FROM SYDNEY VIA KUALA LUMPUR (747-400, 3/WEEK).

JOINT VENTURE WITH FRENCH FIRM LINKED TO AIR FRANCE (AFA) TO SET UP AN ENGINE SERVICING COMPANY AT SUBANG INTERNATIONAL AVIATION & AEROSPACE PARK (SIAP), POSSIBLY GIVING (MAS) EXTRA LANDING RIGHTS TO PARIS. FACILITY WILL SPECIALIZE IN ENGINE THRUST REVERSERS, ONE OF VERY FEW IN ASIA.

737-4H6 (2479-26447, 9M-MMU), RETURNED FROM SAHARA AIRLINES (SAQ).

JULY 2000: TALKS BY QANTAS AIRWAYS (QAN) FOR POSSIBLE 13% STAKE IN MALAYSIA AIRLINES (MAS).

MASKARGO AGREEMENT WITH SWISSCARGO FOR JOINT SERVICE TO BASEL (747-200F), TO HAHN, AND CHICAGO - EUROPE.

1999 PRE-TAX = +$16 MILLION (-$189M): 32.24 BILLION (RPK) TRAFFIC (+19.3%); 1.17 BILLION (FTK) FREIGHT TRAFFIC; 15.66 MILLION PASSENGERS (PAX) (+25.1%). 1999 NET = -$183 MILLION.

22,800 EMPLOYEES.

1999 TOP WORLD AIRLINES COMPARISONS:
TRAFFIC (RPK) (BILLION): 19 TII 38.5; 20 ALI 36.7; 21 KAL 36.7; 22 IBE 35.4; 23 SWS 34.7; 24 MAS 32.2; 25 AMW 28.5.

EMPLOYEES (K): 15 SIA 27.4; 16 KLM 27.3; 17 SAS 25.8; 18 TII 24.1; 19 QAN 23.4; 20 ACN 23; 21 MAS 22.8; 22 IND 22; 23 TWA 21; 24 EGP 20.1; 25 JAL 19; 26 ALI 18.8.

LAST 2 737-3H6C'S SOLD TO PETRAIR, SWITZERLAND.

AUGUST 2000: IN SEPTEMBER 2000, CODE SHARE WITH CATHAY PACIFIC (CAT) TO HONG KONG.

MEDIA RUMOR THAT AHMAD TAJUDDIN ALI, TO BE CHAIRMAN. PRESENT
HEAD, TAJUDIN RAMLI IS EXPECTED TO SELL HIS STAKE IN MALAYSIA AIRLINES (MAS).

2 737-3H6F'S (27125; 27347), SOLD TO AVIACARGO, LEASED TO FRENCH POST OFFICE (FPO). 737-5H6 (26448) RETURNED TO (GEH), LEASED TO AIR FRANCE (AFA).

SEPTEMBER 2000: 737-5H6 (27365) RETURNED TO (GEH), LEASED TO AIR FRANCE (AFA).

OCTOBER 2000: TO BANGALORE AND HYDERABAD. MASKARGO TO BASEL (747-200F, 2/WEEK).

21,970 EMPLOYEES (INCLUDING 1148 FLIGHT CREW (FC), 4,005 CABIN ATTENDANTS (CA), & 2,023 MAINTENANCE TECHNICIANS (MT) (-5%).

OCTOBER 2000: CODE SHARE WITH KLM AMSTERDAM - COPENHAGEN,
GOTHENBURG, HELSINKI, MALMO, OSLO, SANDEFJORD, STOCKHOLM.

MASKARGO MOVED ITS MIDDLE EAST HUB FROM DUBAI TO SHARJAH.

737-5H6 (27354) RETURNED TO GEH, LEASED TO BRITISH AIRWAYS (BAB). 1 747-2D7BF (21784, N524MC), ATLAS AIR (TLS) WET-LEASED FOR MASKARGO.

NOVEMBER 2000: IN JANUARY 2001, WILL REMOVE -20 AIRPLANES FROM SERVICE: 737-400/-500'S FROM 37 TO 36; 747'S FROM 16 TO 8; 777'S FROM 11 TO 8; A330-300'S FROM 10 TO 8, & F 50'S FROM 10 TO 4.

APPROXIMATELY -5,000 WORKERS WORLDWIDE WILL BE LAID OFF.

DECEMBER 2000: OUTSOURCES ITS INFORMATION TECHNOLOGY (IT) TO ATRAXIS, THE (IT) SUBSIDIARY OF SAIRGROUP (SWS).

GOVERNMENT PURCHASES CONTROLLING STAKE IN MALAYSIA AIRLINES (MAS) FOR $471 MILLION FROM TYCOON, TAJUDIN RAMLI, CHAIRMAN, A MERCHANT BANKER, TURNED ENTREPRENEUR, WITH CLOSE TIES TO GOVERNMENT LEADERS. THIS WILL ALLOW THE LONG-AWAITED RESTRUCTURING EFFORT TO PROCEED. WILL PROBABLY CUT -5,000 JOBS.

(MAS) 737-7H6 BBJ HAS "MASTAR" ABOVE FUSELAGE WINDOWS.

JANUARY 2001: PLANS SERVICE TO YOKOHAMA.

TOP WORLD AIRLINES 2000 - TRAFFIC (RPM) (BILLION):
19 ALI 25.24; 20 KAL 25.15; 21 IBE 24.87; 22 MAS 23.58; 23 SWS 21.28; 24 AMW 19.10; 25 VAA 18.31; 26 VAR 16.33; 27 CHI 16.14; 28 SAS 14.07; 29 ANZ 13.82.

FEBRUARY 2001: AZIZAN ZAINUL ABIDIN, NON-EXECUTIVE CHAIRMAN. MOHAMAD NOR MOHAMAD YUSOF, MANAGING DIRECTOR.

APRIL 2001: 21,687 EMPLOYEES (INCLUDING 1,300 FLIGHT CREW (FC), 4,300 CABIN ATTENDANTS (CA), & 1,220 MAINTENANCE TECHNICIANS (MT)).

1 777-2H6ER (29066, 9M-MRM), SALE (SIL) LEASED.

MAY 2001: MASKARGO MOVES ITS EUROPEAN HUB FROM HAHN, GERMANY TO AMSTERDAM AFTER INVESTING $20 MILLION TO UPGRADE THE FACILITY.

CHEJU - HONG KONG (3/WEEK). TO BANGALORE (2/WEEK). TO HYDERABAD (WEEKLY). NOW HAS TOTAL OF 95 DOMESTIC & INTERNATIONAL DESTINATIONS.

A330-322 (068, 9M-MKB) WRITTEN OFF (W/O) AFTER MARCH 2001 CHEMICAL SPILL.

JUNE 2001: FISCAL YEAR (FY) 2000 = -$342 MILLION.

CODE SHARE WITH AIR-INDIA (AIN) TO MUMBAI BANGALORE, AND HYDERABAD. CODE SHARE WITH QATAR AIRWAYS (QTA) TO DOHA.

OCTOBER 2001: DROPS 12 INTERNATIONAL ROUTES: MUNICH; ROME; ZURICH; MANCHESTER; BUENOS AIRES; AUCKLAND; DARWIN; CAIRNS; CAIRO; BEIRUT; KARACHI; AND ISTANBUL.

WILL CREATE A SURPLUS OF 6 747-400'S INCLUDING 3 TO BE DELIVERED BETWEEN NOW AND APRIL 2002 AND 2 777-200'S IN 2002. SELLS ITS LAST DC-10-30 (48283) TO DASH AVIATION, USA. 1 767-316F (32573, N314LA), LANCHILE (LAN) WET-LEASED TO MASKARGO.

DECEMBER 2001: SUBANG AIRPORT, 14 MILES OUTSIDE KUALA LUMPUR, &
CURRENTLY HANDLING 50 DOMESTIC SCHEDULED SERVICES WILL CEASE OPERATIONS IN APRIL 2002, WHEN NEW HIGH-SPEED EXPRESS TRAIN FROM THE CITY TO THE KUALA LUMPUR INTERNATIONAL AIRPORT COMMENCES SERVICE.

1 747-4H6B (28433, 9M-MPO) DELIVERY.

JANUARY 2002: AS PART OF ITS RESTRUCTURING PLANS TO SEPARATE ITS INTERNATIONAL AND CARGO OPERATIONS, FROM ITS DOMESTIC OPERATIONS. WILL SET UP A NEW COMPANY, AS A SUBSIDIARY, OF THE AIRLINE. (MAS) WILL HANDLE THE CORE OPERATIONS OF THE AIRLINE: FLIGHT OPERATIONS AND ENGINEERING, WHILE THE PROPOSED COMPANY WILL BE CREATED WITH ADMINISTRATION, CORPORATE, AND MANAGEMENT RESPONSIBILITIES. THIS WILL ALLOW THE PRIVATE EQUITY INVESTORS TO SHIFT PORTFOLIO FOCUS TO THE INTERNATIONAL PASSENGER & CARGO SERVICES, WHILE THE GOVERNMENT WILL HOLD THE STAKE FOR THE DOMESTIC BUSINESS. CURRENTLY, THE GOVERNMENT HOLDS 83% STAKE, WITH THE REMAINING 17%, FLOATED ON THE OPEN MARKET.

2001 TOP 50 WORLD AIRLINES - TRAFFIC (BILLION) (RPK):
1 UAL 116.60; 2 AAL 106.15; 3 DAL 97.60; 4 NWA 73.11; 5 BAB 64.24; 6 AFA 59.54; 7 CAL 58.76; 8 DLH 56.76; 9 JAL 50.77; 10 USA 45.93; 11 SWA 44.50; 12 SIA 42.76; 13 QAN 42.14; 14 ACN 41.49; 15 KLM 35.76; 16 ANA 33.16; 17 CAT 27.81; 18 TII 27.43; 19 IBE 25.64; 20 KAL 23.73; 21 ALI 22.45; 22 MAS 22.29; 23 AMW 19.06; 24 VAA 17.65; 25 VAR 16.02; 26 CHI 16.00; 27 EAD 14.37; 28 SAS 14.26; 29 ANZ 13.54; 30 SAA 12.70; 31 SVA 12.56; 32 BEJ 12.39; 33 ASA 12.23; 34 JAS 10.06; 35 THY 9.35; 36 AMX 8.51; 37 PAL 8.36; 38 GIA 8.15; 39 CMA 7.99; 40 ELA 7.79; 41 GUL 7.65; 42 PIA 7.24; 43 AIN 7.10; 44 TAP 6.43; 45 EGP 5.53; 46 OLY 5.24; 47 AUL 5.06; 48 FIN 4.93; 49 IND 4.52; 50 CQT 4.51.

MARCH 2002: 747-4H6B (29900) DELIVERY.

APRIL 2002: GOVERNMENT TAKES LEGAL ACTION AGAINST FORMER (MAS) CHAIRMAN TAN SRI TAJUDIN RAMLI AND 3 FORMER SENIOR EXECUTIVES CONCERNING MANAGEMENT "IRREGULARITIES" WITH PARTICULAR FOCUS ON SEVERAL TRANSACTIONS INVOLVING ITS CARGO DIVISION, MAKSKARGO. ALSO, WANTS SOME SETTLEMENT RE-$263.1 MILLION OF PERSONAL DEBTS.

22,064 EMPLOYEES.

MAIN BASE: KUALA LUMPUR INTERNATIONAL AIRPORT (KUL).

OWNERS/SHAREHOLDERS: GOVERNMENT (29.09%); KUMPULAN WANG AMANAH PENCEN (19.59%); AIRLINE EMPLOYEES PROVIDENT FUND BOARD (13.25%); AMANAH RAYA NOMINEES (TEMPATAN) SDN BHD A/C SKIM AMANAH SAHA (10.29%); STATE FINANCIAL SECRETARY SARAWAK (4.42%); WARISAN HARTA SABAH SDN BHD (3.9%); BANK SIMPANAAN NASIONAL (2.26%).

June 2002: 2001 Top World Airlines by Traffic (RPK) (Billion):
1 UAL 187.67; 2 AAL 170.88; 3 DAL 163.66; 4 NWA 117.66; 5 BAB 106.27; 6 CAL 98.37; 7 AFA 94.42; 8 DLH 86.70; 9 JAL 84.27; 10 USA 73.93; 11 SWA 71.59; 12 SIA 69.15; 13 QAN 67.89; 14 ACN 67.03; 15 KLM 57.85; 16 ANA 56.90; 17 CAT 44.79; 18 TII 44.04; 19 IBE 41.30; 20 KAL 38.45; 21 MAS 38.31; 22 ALI 36.52; 23 SWS 32.98; 24 TWA 31.85; 25 AMW 30.69.

MALAYSIA AIRLINES (MAS) 2001 = -# MYR835.6 MILLION/-$219.79 MILLION (-$ MYR417.4 MILLION/-$109.79 MILLION): 38.31 BILLION (RPK) TRAFFIC (+9.7%); 74.8% LF LOAD FACTOR; 16.75 MILLION PASSENGERS (PAX) (+8.9%); 1.84 BILLION (FTK) FREIGHT TRAFFIC (+10.4%); 21,072 EMPLOYEES (-.4%).

August 2002: Government comes to rescue to make Malaysia Airlines (MAS) the only Asian airline with no debt. A restructuring plan involves the government creating a holding company, that will take care of the airline's fleet of nearly 100 airplanes, and assume its liabilities. (MAS) is currently $2.4 billion in debt. (MAS) will become an international and cargo services operator, leasing airplanes from the holding company, Penerbangan Malaysia (PMB). (MAS) will run domestic flights on behalf of (PMB) for a fee.

To Colombo (2/week).

October 2002: 3 747-236Fs (23711; 24088), Air Atlanta Icelandic (AID) 3-year wet-leased for MASKARGO (MKO). To fly to the Netherlands, Germany, Japan, Australia, Hong Kong, and Taiwan.

Government of Malaysia, has granted AirAsia (ASW) approval to service equal routes as Malaysia Airlines (MAS), to allow a competitive market to exist in Malyasia.

November 2002: Malaysia Airlines (MAS) is having difficulties with the need for the Malaysian government to update its bilateral air service agreements with China and India, which is hampering its plans for expansion. (MAS) currently, makes 17 weekly flights, to 5 Indian cities, and 24 to 4 cities in China. (MAS) is seeking more services to Xiamen, Guangzhou, Bangalore, Chennai, and Hyderabad.

$120 million fleet upgrade, with flat beds for 17 747-400's, and reconfiguartion of 15 777's and 9 A330-300's to business class (C) and economy class (Y) two-class only, with business (C) class seat pitch extended to 58 inches, from 52 inches. The Matsushita 2000E in-flight entertainment system will be upgraded to the 3000 Series.

December 2002: Sultan of Pahang, on his 72nd birthday, conferred the title of Darjah Indera Mahkota Pahang (DIMP) to Malaysia Airlines (MAS) Managing Director, Dato' Md Nor Yusof.

Scheduled service to Bangalore, and Hyderabad. Receives OK for service to +10 Chinese destinations (5 immediately, & 5 in 2005).

Now government has control of (MAS), the Prime Minister states they will acquire A380's, 555 PAX, including $210 Million contract to Malaysian state-owned company to design and produce panels for the lifetime of A380 production.

January 2003: Malaysia Airlines (MAS)'s parent company, Penerbangan Malaysia Berhad (PMB) announces a Memo of Understanding (MOU) for 4/2 orders (June 2007) A380-800's, 555 PAX. 747-4H6 (24315) sold to Boeing (TBC).

3 orders (February 2003) A330-223's (290; 299; 300), ex-Sabena (SAB)/Delsey(VGZ), (ILF) 3 year leased, for service to Singapore, China, and Kolkata, India.

February 2003: Plans to establish hubs in Kota Kinabalu and Kuching.

2 A330-223's (290, 9M-MKX; 300, 9M-MKW), (ILF) 3 year leased.

April 2003: 21,661 employees.

May 2003: Fiscal Year (FY) 2002 = +RM 339.1 Million/+$89.2 Million (-RM 835.6 Million), due to radical restructuring in which government vehicle, Penerbangan Malyasian Berhad took over Malaysia Airlines (MAS)'s massive debt and most of its assets and now holds 69.4% of its stock. (MAS) became a virtual airline operating international flights and freight services, while providing domestic flights under contract. International traffic was 32.98 Billion (RPK) traffic (+9.4%); domestic 4.67 Billion (RPK) traffic (+2.4%); 2.07 Billion (ASK) capacity (+17.7%); 68.8% LF load factor (+3.3); domestic 74% LF (+4.2). Traffic has slumped because of the Iraq war and the Asian Severe Acute Respiratory Syndrome (SARS) virus epidemic, resulting in the grounding of 8 airplanes.

2002 = +$88.2 Million (-$230.5 Million): 37.65 Billion (RPK) traffic (+8.5%); +3.2% (ASK) capacity; 69.4% LF load factor (+3.4); 16.3 Million passengers (PAX) (+3.8%); 2.07 Billion (FTK) freight traffic (+17.7%); 17,839 employees (+9.5%).

2002 TOP 25 WORLD AIRLINES - TRAFFIC - (Billion) - (RPK)
1 (AAL) 195.81; 2 (UAL) 176.15; 3 (DAL) 152.66; 4 (NWA) 115.91; 5 (BAB) 99.71; 6 (AFA) 96.80; 7 (CAL) 95.51; 8 (DLH) GRP 88.57; 9 (JAL) 83.54; 10 (QAN) 75.23; 11 (SWA) 73.05; 12 (SIA) 71.12; 13 (ACN) 69.42; 14 (USA) 69.42; 15 (KLM) 58.89; 16 (ANA) 52.97; 17 (CAT) 49.04; 18 (TII) 48.51; 19 (KAL) 41.80; 20 (IBE) 40.47; 21 (MAS) 36.90; 22 (AMW) 31.98; 23 (SAS) GRP 30.91; 24 (EAD) 30.17; 25 (ALI) 29.84.

2002 TOP 25 WORLD FREIGHT CARRIERS - (Billion) - (FTK)
1 (FED) 13.20; 2 (LUB) 7.16; 3 (UPS) 6.62; 4 (KAL) 6.25; 5 (SIA) 6.08; 6 (AFA) 4.87; 7 (CAT) 4.85; 8 (CHI) 4.60; 9 (JAL) 4.39; 10 (CLX) 4.16; 11 (BAB) 4.12; 12 (KLM) 3.99; 13 (EVA) 3.28; 14 (NWA) 3.24; 15 (AAL) 2.93; 16 (UAL) 2.79; 17 (AAR) 2.75; 18 (NCA) 2.21; 19 (POA) 1.97; 20 (EAD) 1.96; 21 (MAS) 1.92; 22 (BEJ) 1.88; 23 (TII) 1.824; 24 (DAL) 1.823; 25 (ACN) 1.58.

July 2003: 22,800 employees.

Code share with Garuda Indonesia (GIA), Kuching - Balikpapan, and Kota Kinabalu - Balikpapan (2/week).

2002 Fiscal Year (FY) = +$89.20 million (-$219.79 million): 36.90 million (RPK) traffic (+3.5%); 69.6% LF load factor; 16.21 million passengers (PAX) (+.6%); 1.92 billion (FTK) freight traffic (+8.4%).

August 2003: A few days after AirAsia (ASW) announced plans to expand internationally to India, Malaysia Airlines (MAS) hired +800 cabin crew (CA) and may also add airplanes as part of its Asian expansion drive.

(MAS) selects B/E Aerospace to provide a turnkey, cabin interior upgrade package. The retrofit program will create a luxurious supr-premium environment for 1st class (F) and business class (C) passengers on the airline's wide-body airplanes. (MAS) is retrofitting its entire fleet of 17 747-400's with a highly advanced premium class cabin, offering many comfort amenities for the long-haul traveler. The lavish cabin environment will feature B/E's next-generation electric lie-flat seats, Full Spectrum digital lighting system, electric window shades, executive cabinetry and storage closets. Also included are customized lavatories, luggage bins and sidewalls. In addition, (MAS) will upgrade its 15 777-200's with B/E's lie-flat business class (C) seats, modified economy class (Y) seating, and the Full Spectrum digital lighting system. B/E will handle interior reconfiguration engineering, program and supplier management, and certification for both airplane upgrade programs through its Flight Structures, Inc, subsidiary. Product deliveries are scheduled to begin in the fall of 2004 and continue through late 2005. (MAS) will also install Matsushita Avionics System 3000i (AVOD) system on the airplanes.

Kuala Lumpur - Manado. Plans to add service to Jogjakarta and Padang. Code share with Garuda Indonesian (GIA), Kuala Lumpur to Frankfurt & London Heathrow, Surabaya - Kuala Lumpur, and Denpasar to Darwin.

September 2003: In October 2003, London - Penang (747-400, 2/week). London (LHR) - Langkawi (2/week). In December 2003, charter service Langkawi - Milan (Malpensa) (weekly).

October 2003: Code share with Lauda Air (LAL), Vienna - Kuala Lumpur.

2 orders (January 2004) A330-322 (PW4168A), ex-Skyservice (SKB), (ILF) 3 year leased.

Novemmber 2003: Kuching - Kota Kinabalu - Guangzhou (737-400, 3/week).

December 2003: 13 weekly charters between Milan and Langkawi until April 2004, on behalf of Hotelplan Italia. MASKargo (MKO), Kuala Lumpur - Basel - Manchester.

January 2004: A330-223 (262, 9M-MKT), (ILF) leased.

February 2004: MASKargo (MKO), Kuala Lumpur - Dubai - Manchester - EuroAirport (Basel/Mulhouse/Freiburg) - Dubai - Kuala Lumpur (747-200F). In March 2004, resumes Sydney - Kuala Lumpur - Dubai - Manchester - Basel/Mulhouse - Dubai - Kuala Lumpur - Sydney.

(MOU) with Pemco re-joint venture for 737F freighter conversions at Subang.

A330-223 (255, 9M-MKU), (ILF) leased.

April 2004: MASKargo (MKO) (http://www.maskargo.com & media@mas.com.my) plans to expand its cargo capacity by +30% with the addition of new routes including Bangalore, Bangkok, Basel, Beijing, Beirut, Manchester, and Milan.

Ahmad Fuaad Mohd Dahlan, Managing Director.

May 2004: In June 2004, Kuala Lumpur - Siem Reap (737-400, 3/week). Kuala Lumpur - Ahmedabad (777, 3/week). For rest of year will concentrate on new destinations in India and China: Kolkata; Ahmedabad; & Cochin, + Kunming; Wuhan; & Chengdu.

Fiscal Year (FY) 2003 = +461.1 Million ringgit/+$121.4 Million (+37.2%) (+336.5 million).

A330-322 (095, 9M-MKR), (ILF) leased.

September 2004: Selected (SITA)'s Aircom SMS for installation on 17 747-400's & 15 777-200's, which enables passengers to send and receive short text messages and e-mails through individual inflt entertainment systems.

Deploys Movement Manager, part of the Sabre AirOps Suite for "enhanced monitoring and scheduling of its daily flight operations.

October 2004: Discusses with AirAsia (ASW) possible cooperation through sharing of Engineering, distribution channels, cost-sharing, and co-promotion.

To expand its codeshare operations with Korean Air (KAL) into a "free sale dynamic codeshare" that will cover 2 additional routes: Seoul - Kota Kinabalu & Seoul - Penang.

Mohamed Munir Abdul Majid, Chairman, ex-Chairman of mobile telephone network company Celcom, replaces Azizan Zainul Abidin, who died suddenly last July 2004.

November 2004: Kuala Lumpur - Stockholm (ARN) - Newark (3/week). Resumes Kuala Lumpur - Fukuoka (3/week).

December 2004: Kuala Lumpur - Ahmedabad (3/week).

Malaysia Airlines (MAS) and PEMCO Aviation Group have agreed to establish a 737-300 passenger-to-freighter conversion operation at Kuala Lumpur. The 1st conversions are expected to begin in 2005 to convert 2 to 3 airplanes in 1st year.

747-267B (22530, TF-ABA), Air Atlanta Europe (EUK) wet-leased. 777-2H6ER (28421, 9M-MRP) (equipped with Electronic Flight Bags) delivery.

January 2005: 17,839 employees.

MASKargo 2004 = +19.5% (FTK) freight traffic.

777-2H6ER (28422, 9M-MRQ) delivery.

February 2005: Expected to order 60 737-800's.

June 2005: As national carrier of Malaysia, Malaysia Airlines (MAS) operates scheduled services to Asia, Europe, the Middle East, South Africa, and the USA. An extensive domestic network is also operated.

17,939 employees.

(IATA) Code: MH - 232. (ICAO) Code: MAS - MALAYSIAN.

(media@mas.com.my). SITA: KULDZMH KULWPMH.

Parent organization/shareholders: Penerbangan Malaysia Berhad (PMB) (69.34%); Employees Provident Fund Board (8.19%); Amanah Raya Nominees (Tempatan) (5.45%); State Financial Secretary Sarawak (2.71%); & Warisan Harta Sabah (2.4%).

Alliances: Air Mauritius (MAU); Air-India (AIN); All Nippon Airways (ANA); BMI British Midland (BMA); Cathay Pacific (CAT); Dragonair (DRG); Egyptair (EGP); Garuda Indonesia (GIA); Iran Air (IRN); (KLM); Korean Air (KAL); Lauda Air (LAL); Philippine Airlines (PAL); Qatar Airways (QTA); Royal Brunei Airlines (RBA); SilkAir (SLK); Singapore Airlines (SIA); SriLankan Airlines (LNK); Swiss (CSR); Thai Airways (TII); Uzbekistan Airways (UZB); Vietnam Airlines (VIE); & Virgin Atlantic Airways (VAA).

Main Base: Kuala Lumpur International airport (KUL).

Domestic, Scheduled Destinations: Alor Setar; Bakalalan; Bario; Belaga; Bintulu; Ipoh; Johor Bahru; Kota Bahru; Kota Kinabalu; Kuala Lumpur; Kuala Terengganu; Kuantan; Kuching; Kudat; Labuan; Lahad Datu; Langkawi; Lawas; Limbang; Long Akar; Long Banga; Long Lellang; Long Seridan; Marudi; Miri; Mukar; Mulu; Penang; Sandakan; Sibu; Tawau; & Tomanggong.

International, Scheduled Destinations: Adelaide; Ahmedabad; Amsterdam; Auckland; Bandar Seri Begawan; Bangalore; Bangkok; Beijing; Beirut; Brisbane; Buenos Aires; Cairo; Cape Town; Cebu; Chegdu; Chennai; Colombo; Delhi; Denpasar Bali; Dhaka; Dubai; Frankfurt; Fukuoka; Guangzhou; Hanoi; Hat Yai; Ho Chi Minh City; Hong Kong; Hyderabad; Istanbul; Jakarta; Jeddah; Johannesburg; Kaohsiung; Karachi; Kolkata; Kunming; London; Los Angeles; Male; Manchester; Manila; Mauritius; Medan; Melbourne; Mumbai; Nagoya; New York; Osaka; Padang; Paris; Perth; Phnom Penh; Phuket; Pontianak; Rome; Seoul; Shanghai; Siem Reap; Singapore; Stockholm; Surabaya; Sydney; Taipei; Tarakan; Tokyo; Vienna; Xi'An; Xiamen; Yangon; & Zurich.

Selects Honeywell's Runway Awareness & Advisory System (RAAS) for its fleet of 92 airplanes and 3 flight simulators.

July 2005: 5 orders (October 2005) 737-700's, leased. To be used for flights to secondary airports in India and China, starting with services to Fuzhou, Cochin, Trichy, Shenzhen,and Guilin.

August 2005: 20,789 employees (+11.1%).

Ahmad Fuaad Dahlan, Managing Director, retired after 32 years.

September 2005: Boeing (TBC) is moving closer to the launch of the 747-400 with the announced sale of four 747-400Fs to Nippon Cargo Airlines (NCA). According to insiders at the manufacturer, the next delivery slots are 747-400 airplanes. This year, Boeing (TBC) has sold 24 747-400s and now has a backlog of 30 net of five cancellations logged in 2005.

Low-cost carrier AirAsia (ASW) and loss-making Malaysia Airlines (MAS) are close to a wide-ranging agreement, according to (ASW) founder & CEO, Tony Fernandes. Fernandes said, "we will have an announcement shortly as our relationship with (MAS) Airlines is improving rapidly, which gives us ways of potentially maximizing our revenue."

The airline group continued its spectacular growth in July, with passengers up 24.8% to 395,667 on (ASW) and 16.1% to 148,953 in Thailand. The Indonesian operation, (AWR), carried 56,256 passengers.

Malaysia Airlines (MAS) advised the markets that its first A380 will be delivered six months late, similar to the revised delivery schedules for all launch customer airlines. (MAS) said in a media release, "Airbus (EDS) confirmed that the first A380-800 airplane will be delivered in July 2007 instead of January 2007 and the last (sixth) airplane will be delivered in May 2009." Executive Director, Tengku Azmil Zahruddin said, "We are naturally disappointed with this delay. We are considering our options on this matter, but will continue to engage with Airbus (EDS) to ensure that any inconvenience to our customers and financial impact to the airline are minimized." (MAS) has stated that it will be seeking compensation from Airbus (EDS) for the delayed deliveries.

Cargolux (CLX) has announced its intention to order 10/20 747-400F freighters. Other carriers identified with the program are China Airlines (CHI), Malaysia Airlines (MAS), Japan Airlines (JAL), Singapore Airlines (SIA), and British Airways (BAB).

October 2005: Malaysia Airlines (MAS) will consolidate its network and eliminate service to five cities in India and China as part of an effort "to contain its cost growth and improve performance," the carrier said yesterday. The announcement came nearly two months after Chairman Mohamed Munir Abdul Majid said (MAS) would "focus on significant short-term improvement initiatives and implement a longer-term plan to improve operating performance as well" in the wake of a MYR280.7 million/$74.5 million second-period loss.

Planned service to Amritsar, Cochin, Fuzhou, Guilin and Shenzen will be deferred indefinitely. Meantime, the airline will add three flights per week from Kuala Lumpur to New Delhi and one per week to Xiamen. It also intends to add capacity into Perth and Auckland using 747s.

"The realignment of the network is expected to result in improving route financials," (MAS) said, adding it "will further realign and consolidate its services to complement traffic demand."

(MAS) trims route expansion as it drops plans to start flights to five cities in India and China. Services to the Indian cities of Amritsar and Cochin, and the Chinese cities of Fuzhou, Guilin and Shenzen, will be deferred indefinitely. (MAS) will boost capacity on flights to Australia and New Zealand by using 747s instead of 777s. (MAS) will increase the frequency on its Kuala Lumpur to New Delhi route from 4 to 7 flights a week from Oct 31st. At that point (MAS) will operate daily service to 3 Indian destinations including Chennai and Mumbai with weekly service to Ahmedabad, Hyderabad and Kolkata.

Malaysia Airlines will consolidate its network and eliminate service to five cities in India and China as part of an effort "to contain its cost growth and improve performance," the carrier said yesterday. The announcement came nearly two months after Chairman Mohamed Munir Abdul Majid said MAS would "focus on significant short-term improvement initiatives and implement a longer-term plan to improve operating performance as well" in the wake of a MYR280.7 million ($74.5 million) second-period loss.

737-86N (28595, OK-TVD) & 737-8QN (30278, OK-TVC), Travel Service (TSF) wet-leased.

December 2005: A profitable carrier at this time last year, Malaysia Airlines (MAS) was unable to handle rising costs during the fiscal second quarter ended September 30, posting a net loss of -MYR367.7 million/-$97.3 million that reversed earnings of +MYR132.7 million in the year-ago quarter. (MAS) said it does not expect an immediate return to profitability. "Systematic transformation initiatives are underway," Chairman Mohamed Munir Abdul Majid said in a statement. "However, while the company is already realizing several quick wins in areas such as revenue enhancement, procurement, fuel efficiency and automation of business services, it must be appreciated some issues of many years standing will take time to be resolved."

Operating performance dropped from a +MYR146.2 million profit to a -MYR373.2 million loss in the quarter. While operating revenues remained steady, rising +9.7% to MYR2.98 billion, expenses surged +29.6% to MYR3.41 billion. The company said a +45% jump in fuel costs to MYR1.2 billion was the most critical factor in its financial downturn.

Yield excluding fuel surcharges decreased -1.5% to MYR0.19 as (RPK)s (passenger traffic) grew +11.1% against a +4.4% rise in (ASK)s (capacity). Load factor was up +0.3 point to 62.2% LF. MASKargo (MKO)'s revenue increased +2% to MYR581.2 million.

The airline outlined in its report several of the "transformation initiatives" mentioned by the chairman. They include a fuel efficiency task force coordinating weight reduction and flight management improvements, a new flight planning and operations system designed to save -MYR150 million per year and other cost-cutting and strategic measures.

(MAS)'s half-year performance showed a -MYR648.4 million loss against income of +MYR159.3 in 2004. Operating losses of -MYR660.8 million compared to a +MYR153.8 profit. Revenues rose +12.5% to MYR5.76 billion while expenses grew +29.3% to MYR6.54 billion.

Malaysia Prime Minister Abdullah Ahmad Badawi told reporters that the government is prepared to lend money to troubled Malaysia Airlines (MAS) but will not bail it out, Reuters reported. He also did not rule out selling some of the government's stake depending on the content of (MAS)'s new business plan.

Malaysia Airports wants to lift passenger spending at its showcase Kuala Lumpur International by +50%. Speaking at the Centre for Asia Pacific Aviation (CAPA)'s 2006 Outlook Summit in Kuala Lumpur, Malaysia Airports Holdings Managing Director Seri Bashir Ahmad unveiled a plan to improve retail offerings by finding new uses for underutilized assets, such as the possible construction of a theme park on vacant land adjacent to the airport, to boost nonaeronautical revenues. On the other hand, Airports Council International Director-Economics Paul Behnke called on governments and airport operators across the region for increased investment in airport capacity. According to Behnke, "with today's constraints and without more intelligent airport investment, by 2020, the worldwide airport system may be unable to comfortably accommodate more than 1 billion passengers of the 7 billion forecasted to demand air transport services." As a complementary measure to airport investment, he suggested that countries should adhere to (CAPA)'s "Manifesto for Growth," which calls on Asia/Pacific governments to grant foreign carriers access to secondary airports, alleviating congestion at hubs while benefiting secondary airports and cities.

AirAsia (ASW) confirmed that it has submitted a proposal to the Malaysian government to operate all but three of Malaysia Airlines (MAS)'s domestic routes. The plan is part of the government's review of a domestic airline system that has been a continual loss-maker for (MAS). Earlier this month, (ASW) took delivery of the first of 100 A320s and announced an additional eight destinations in Indonesia from Kuala Lumpur. (MAS) has deferred a decision on a replacement for its fleet of 737s, but if (ASW) is successful in its bid, which is highly likely, the order for up to 50 airplanes will be reduced greatly or scrapped.

January 2006: Evans & Sutherland (E&S) Computer Corporation said Malaysia Airlines (MAS) will equip its Thales A380 flight6 simulators with (E&S)'s EP-1000CT visual system. Emirates (EAD), Qantas (QAN) and Singapore Airlines (SIA) also recently placed orders for the system. (E&S) signed a deal with (CAE) to produce an EP-1000CT/ESCP-2000 system for an Embraer E170 simulator ordered by Saudi Arabian Airlines (SVA).

February 2006: Messier Services secured 777 landing gear Maintenance Repair & Overhaul (MRO) contracts with Malaysia Airlines (MAS) and Thai Airways International (TII) covering nine and 14 shipsets respectively. In addition, Boeing selected Messier Services Asia Pte as an approved facility for landing gear and component repair and overhaul.

Aeroxchange announced that (MAS) signed a marketplace subscription for products including AeroAOG, AeroBuy, AeroRepair, AeroSell and AeroSourcing.

(MAS) warned yesterday that "on its current business assumptions, course and speed, [it] will likely fail," exhausting its cash "in April 2006" and posting a -MYR1.7 billion/-$472 million loss for the year." A real business turnaround is an imperative for (MAS). The management team and our staff believe strongly in our ability to transform the business and, indeed, to go beyond expectations," Managing Director Idris Jala said as he revealed the company's Business Turnaround Plan aimed at returning the airline to profit by 2007, with net earnings of -MYR500 million in Fiscal Year (FY) 2008.

For the fiscal third quarter ended December 31, (MAS)'s parent company reported a loss of -MYR616.4 million compared to a net profit of +MYR57.6 million in the year-ago quarter. It marked the carrier's third consecutive quarterly loss. Third-quarter revenues increased +6.3% to MYR3.09 billion against a +27.5% rise in operating expenses to MYR3.78 billion, resulting in an operating loss of -MYR605.1 million compared to a profit of +MYR72.8 million in the year-ago period. Fuel costs climbed +24.6% to MYR1.26 billion.

The turnaround plan is based on five themes central to the airline's revitalization, among them, "Flying to win customers," "Mastering operational excellence" and "Winning coalitions." (MAS) said it aims to "relentlessly increase profits" while tackling its low yield, which it called its "biggest immediate profitability challenge." Key initiatives this year include an overhaul of pricing and revenue management to drive increased performance from the network; airplane cabin reconfiguration to ensure the optimal mix of first, business and economy class passengers, and optimizing the network and fleet portfolio "to ensure the right airplane is going to the right market at the right time."

The company intends to raise MYR4 billion in cash this year "through internal and external sources" to see it through current difficulties. Next year, it will concentrate on improving efficiency, leaving expansion for 2008.

In the nine-month period, (MAS) lost -MYR1.26 billion compared to a net profit of +MYR216.9 million in April - December 2004. Revenues climbed +10.3% to MYR8.85 billion but expenses increased +28.8% to MYR10.33 billion. Operating loss for the period was -MYR1.25 billion versus a +MYR226.6 million operating profit in the corresponding 2004 period.

March 2006: A business turnaround plan released by Malaysia Airlines (MAS) charts a course for a return to the black by 2007 and outlines an economic, operational and philosophical overhaul of the underachieving carrier, which admitted that low yields and surging costs will exhaust its cash by April, unless it implements drastic changes. Following three consecutive loss-making quarters, (MAS) said its "primary obligation to the government and all other shareholders is to drive top-tier financial performance. Everything we do must be designed to achieve that objective."

The airline said it will start by shifting from a "business focus" to a "leisure focus," as its premium traffic to and from Malaysia is too small to fund investment in larger airplanes with lower seating density. For example, it said its 777-200 has 247 economy (Y) seats compared to 293 on Singapore Airlines (SIA) airplanes. (MAS) will decrease the size of its premium cabins and eventually shift to a fleet comprising smaller, more fuel-efficient airplanes. To secure better connecting flows, it will abandon the point-to-point model on its long-haul routes and concentrate on serving popular markets from its Kuala Lumpur hub. "We will fly only where there are large attractive flows of leisure customers," it said. Business (C) class will provide "gravy" but will not "carry the day."

(MAS) hopes to overhaul its loss-making domestic operation and is aiming to take over (P&L) responsibility from Penerbangan Malaysia Berhad and operate independently, with government support, following a "radical" restructuring to include an increase in domestic fares for the first time in 13 years. AirAsia (ASW) wants access to the domestic market as well.

In order to "strategically differentiate itself," the airline will counter competitors' growing capacity with "stronger cost controls, superior labor and asset productivity and more efficient processes." It said it has not made a firm decision on layoffs, although it promised its ratio of employees to unit of capacity will drop. Government input and the successful conclusion of route profitability initiatives will contribute to the decision, expected to come in 2007.

(MAS) promised a relentless pursuit of profit at the expense of "political favor," "image" and its "stature in the international community." Projects with long lead times will be put aside. It said its leaders will be accountable for reaching specific financial targets and their performance will be "transparently reported." It declared that implementation of the plan will narrow its loss to -MYR620 million/-$167.3 million in Fiscal Year (FY) 2006 and return a profit of +MYR50 million in (FY) 2007.

The Malaysian government ended the wrangling over domestic routes between (MAS) and (ASW), announcing that (MAS) will operate flights to more popular destinations like Penang, Kuching, Kota Kinabalu and others tied to its international network while (ASW) will fly the remaining routes, according to local press reports. Further details will be announced in the future. (MAS) has been losing money on its domestic operations on behalf of parent company PMB.

(MAS) announced it will discontinue service from Kuala Lumpur to 6 International destinations in the coming 3 months. These cities are in Asia : Ahmedabad, Kolkata, Padang and Xian; in Europe: Manchester and Vienna. (MAS) also plans to reduce frequency on the following routes:
Kota Kinabalu to Shanghai;
Kuala Lumpur to Auckland;
Kuala Lumpur to Frankfurt;
Kuala Lumpur to Nagoya;
Kuala Lumpur to Sandakan;
Penang to Singapore.

Industrial action is brewing at (MAS) over the government's recent decision to allow (ASW) to take over most of the national carrier's loss-making domestic routes. (MAS) unions are threatening picket-line action, which may escalate. The unions fear that up to 7,000 staff may lose their jobs. The move to allow (ASW) access to all (MAS) routes has been on the table for more than 18 months as (ASW) posts solid profits while (MAS) struggles to find blue skies. Unions representing (MAS) employees are asking for time to turn the company around and claim they are victims of previous management's mistakes.

(MAS) later delivered the news its employees feared, announcing it will abandon all but 19 domestic routes to (ASW), take 19 airplanes out of service and lay off approximately -6,500 employees, or about -28% of its workforce. (ASW) will take over the remaining 96 routes and compete with (MAS) on the other 19, giving passengers the option of choosing a full-service or a low-cost carrier. The Malaysian government said it will stop subsidizing (MAS) from August 1, according to press reports, although the carrier said in a statement that the government will compensate it for costs incurred in the restructuring of its domestic network.

The government decided two weeks ago that (MAS), which operates domestic services on behalf of Penerbangan Malaysia Berhad (PMB), will retain several popular routes while ceding most services to AirAsia (ASW). (MAS) has been losing money on its domestic routes but said when it unveiled its Business Turnaround Plan, that it did not expect to make a definitive decision on layoffs until 2007.

"Our original intention was to take back the P&L for the domestic sector from (PMB) in 2007 and build this out as a viable business unit. Having said that, we understand the government's vision to establish two national champions in the international aviation sector, one in full service and the other in low cost," (MAS) Managing Director, Idris Jala said.

(MAS) said each of the 19 routes it will continue to operate generates an annual average of 15,000 international connecting passengers and/or 13,000 business/first class passengers. It will operate seven routes between Kuala Lumpur and peninsular cities, six between (KLIA) and Sabah/Sarawak and six within Sabah and Sarawak. It said it has a "free hand" from the government to control capacity, frequency and pricing.

September 2006: Malaysia Airlines (MAS) announced additions to its international network for the winter schedule. From October 29, it will increase Paris Charles de Gaulle service to daily aboard 777s and add a sixth weekly 747-400 flight to Los Angeles. Weekly services to Hanoi will increase to nine and to Cebu to four. Last week it announced a comprehensive codeshare agreement with Virgin Blue (VOZ) covering 22 (MAS) flights into Australia.

(MAS) resumed nonstop service from Kota Kinabalu to Miri (Malaysia). The airline now operates 2 flights a day using a 737-400. (MAS) resumed nonstop service from Kuching to Bintulu (Malaysia). (MAS) now operates 2 flights a day using a 737-400. (MAS) increased frequency from 3 to 4 flights a day on its route from Kota Kinabalu to Sandakan (Malaysia) and are operated with a 737-400. (MAS) increased frequency from 2 to 3 flights a day on its route from Kota Kinabalu to Labuan (Malaysia) and are operated with a 737-400. (MAS) will further increase to 4 flights a day on October 1st. (MAS) will increase frequency on its Kuala Lumpur to Labuan (Malaysia) route from 1 to 2 flights a day on October 1st and operate with 737-400s.

(MAS) and Gulf Air (GUL) will codeshare on flights between Kuala Lumpur and the Middle East. (MAS) will add its code to (GUL)-operated flights to the Malysian capital from Bahrain and Muscat in Oman.

October 2006: Malaysia Airlines (MAS) announced a number of changes on the following routes:
Kuala Lumpur (KUL) - Beirut, resumes on October 15th via Dubai with 3 flights a week, using an A330-200;
(KUL) - Cairo, service to be discontinued on November 1st;
(KUL) - Cebu, frequency increases from 2 to 4 a week on October 30th using a 737-400;
(KUL) - Hanoi, frequency increased from 7 to 9 a week on October 3rd, using a 737-400;
(KUL) - Newark, service via Stockholm to be discontinued on January 15th; will now continue to operate the route beyond that date with 3 flights a week, on Mondays, Thursdays, & Saturdays, using a 777-200.(KUL) - Paris, frequency increases from 5 to 7 a week on October 29th using a 777-200.

November 2006: Malaysia Airlines (MAS)'s Business Turnaround Plan, which included the ceding of a significant chunk of its domestic network to AirAsia (ASW), is working "ahead of schedule," the carrier said yesterday as it reported its first three-month profit in more than a year, a +MYR240 million/+$65.7 million windfall that stands in stark contrast to a -MYR366 million loss in the third quarter of 2005.

The result was boosted by a +MYR194 million gain from the sale of properties and compensation related to the transfer of domestic services to AirAsia (ASW).

"Declaring victory too soon would be a big mistake," CEO & Managing Director, Idris Jala warned. "Whilst we have achieved an improvement of more than +MYR1 billion in the last nine months, we still have a long distance to go. We have a high mountain to climb." Year-to-date, (MAS) lost -MYR258 million compared to a deficit of -MYR533 million in the first nine months of 2005.

(MAS) posted a third-quarter operating profit of +MYR73 million, which it said was driven by a +14% rise in passenger revenues to MYR2.54 billion on a +25% gain in yield and a +24% lift in unit revenue. Increasing yield was a critical part of the turnaround plan, Jala said.

Commercial Director, Rashid Khan said higher fuel surcharges, an "administration fee," more competitive pricing and better inventory management, were critical to lifting yield. In addition, business class (C) revenue grew +19% as (MAS) dispensed with loss-making, low-yield, domestic services. It also boosted the number of codeshare and interline agreements.

On the cost side, the airline already has exceeded its full-year target, having realized -MYR441 million in savings. It cut -2,622 jobs and -MYR85 million from the payroll, slashed marketing -MYR124 million and enacted other cost-saving initiatives.

December 2006: Malaysia Airlines (MAS) suspended its Kuala Lumpur (KLIA) - Cairo service. It will maintain a marketing presence in Cairo and serve it, via codeshare. It also will cancel its (KLIA) - Stockholm Arlanda (ARN) - Newark service on January 15. It will codeshare with (KLM) from Amsterdam (AMS) to (ARN) and said it is "in active discussions" with other carriers to develop links to the USA via (AMS). It also increased its 777-200 service to Paris Charles de Gaulle to daily from five-times-weekly and added a sixth weekly 747-400 flight to Los Angeles via Taipei, two weekly 737-400 flights to Hanoi (now nine) and two to Cebu (now four).

Later, (MAS) decided to retain and maintain its Kuala Lumpur - Stockholm Arlanda - Newark service, which it originally had chosen to suspend from January 15. "Our earlier decision was guided by the initial findings from our route profitability exercise. However, in response to a call from the Malaysian government to reconsider our decision, we reviewed this route," Managing Director & (CEO), Idris Jala said. (MAS) will continue operating the service 3x-weekly aboard a 777-200.

(MAS) and (SITA) signed a 10-year deal to implement (SITA)'s Horizon portfolio of passenger management solutions. (MAS) said it will invest MYR300 million/$82.1 million and realize annual savings of MYR100 million.

February 2007: Malaysia Airlines (MAS) reported a net loss of -MYR136 million/-$39 million for full-year 2006, improved over a loss of -MYR1.7 billion the prior year.

"The improvement is the result of a considerable increase in revenue due to major improvements in passenger and cargo yields, network restructuring, improvement in productivity and cost savings," the airline said in a statement. (MAS) said it would have earned a net profit of +MRY676 million if fuel costs and airplane lease rates had remained constant. Passenger revenue was up +10% to MYR9.3 billion from MYR8.5 billion the previous year. Yield increased +21% to MYR0.24 as (RASK) grew +17% to MYR0.17.

(MAS) reported a net profit of +MYR121 million for the fourth quarter, reversed from a net loss of -MRY611 million in the year-ago quarter. Managing Director & (CEO), Idris Jala credited the "single-mindedness" of the company's Business Turnaround Plan (BTP) unveiled last February with improving its earnings toward the end of the year. "We have exceeded all our (BTP) financial targets," he said, but warned that the carrier "cannot afford to be complacent . . . We are not out of the woods yet."

MASkargo (MKO), the company's airfreight division, was a bright spot. Its full-year revenue increased +8% to MYR2.5 billion and net earnings were +MYR150 million, a record cargo profit for the airline.

(KLM) and (MAS) are strengthening their codeshare cooperation to include (MAS) flights from Kuala Lumpur to Penang, Langkawi and Kota Kinabalu. (KLM) passengers arriving from Amsterdam will have access to the flights from March 1.

March 2007: Malaysia Airlines (MAS) will launch a new subsidiary next month called "Firefly" that will operate two F 50s out of Penang, according to press reports. Firefly will serve Kota Bahru, Langkawi, Kuantan, Kuala Terengganu (all 2x-daily) and the Thai cities of Phuket and Koh Samui (daily). (MAS) (CEO), Idris Jala told reporters that Firefly will break even in its first year, "should be able to make money" in its second and is not subsidized by the government.

(MAS) and Transaero Airlines (TRX) have launched a partnership to develop Moscow Domodedovo - Kuala Lumpur service. The initial phase lasts through this month, during which Transaero (TRX) will operate the route with a 767-300 with (MAS) as a codeshare partner.

(SAA) and (MAS) announced a code share pact effective June 1, under which (SAA)'s code will be placed on (MAS)'s 3x-weekly Johannesburg - Kuala Lumpur service, giving customers from each country access to multiple onward connections.

Intra-Asian air transport liberalization was dealt a blow with confirmation that the governments of Singapore and Malaysia do not intend to open access on the Singapore - Kuala Lumpur route ahead of the (ASEAN) capital city liberalization deadline of year end 2008. The move is seen as protection for (MAS) as it continues its restructuring, although it is to post its third consecutive quarterly profit later this month, according to the Centre for Asia Pacific Aviation (CAPA). (CAPA) said more encouraging news continues to come from Japan, which announced an Asia Gateway Plan aimed at easing access for international carriers to its domestic and regional airports. "Japan is considering a more flexible approach to allocating slots for foreign carriers at its airports, including Kansai International Airport and Central Japan International Airport. Currently, foreign airlines using a full entitlement of slots, are not eligible to take up slots that are not being used by their Japanese counterparts," (CAPA) said.

(MAS)'s spectacular turnaround continued in the first quarter with a net profit of +MYR133 million/+$39.2 million that represented a reversal from the year-ago period's -MYR321 million loss and a significant premium over the +MYR50 to +MRY99 million profit the carrier had forecast. "We really had a good quarter," Managing Director & CEO, Idris Jala said. "We are now aiming to hit our stretched profit target of +MYR300 to +MYR700 million for the year." First-quarter revenues climbed +21% to MYR2.59 billion on a yield increase of +15% to MYR0.251. Traffic rose +5% to 9.92 billion (RPK)s against a +2% lift in capacity to 13.99 billion (ASK)s, giving the airline a +2-point gain in load factor to 71% LF.

(MAS) now is ready to move forward with its long-awaited fleet renewal program, with a Request for Proposal (RFP) for up to 55 twin-aisle airplanes to be launched shortly, pitting the 787 against the A350XWB. Its current long-haul fleet is built around the 747-400, 777-200ER and A330, with six A380s on order, although current management still has not ruled out canceling the A380s. It also is in the market for a similar number of 737NG or A320 family airplanes.

June 2007: Soaring on the wings of a +MYR133 million/+$39 million first-quarter profit, that exceeded the carrier's full-year earnings target of +MYR50 million, Malaysia Airlines (MAS) CEO, Idris Jala said (MAS) will continue to focus on building both yield and network.
"We are working on improving our customer value proposition, looking at every aspect of our work, at every touch point," Jala told media in Vancouver at this week's (IATA) (ITA) Annual General Meeting (AGM).
Commenting on the first-quarter performance, he said (CASM) increased just +5% despite the additional MYR632 million in expenses resulting from taking over profit-and-loss responsibility for the domestic network. One contributing factor to revenue growth was the decision last January to "open its storefronts" by permitting any (IATA) (ITA)-approved and registered travel agent to sell (MAS) tickets, eliminating the exclusive agreements it had with a select number of them. Under its "Project Omega," it aims to achieve full e-ticketing and interline e-ticketing by December.

Additionally, it is growing its third-party maintenance business. "When I started with (MAS), we were making around +MYR100 million from third-party maintenance. Last year, we increased it to +MYR200 million. This year, we are challenging our team to deliver +MYR300 million," Jala said.

Although it is not a member of one of the major global alliances, he said (MAS) is in discussions with two airlines - - one Indian, one Chinese - - about bilateral partnerships. It already has crafted codeshare relationships with Gulf Air (GUL), Alitalia (ALI), Virgin Blue (VOZ), and South African Airways (SAA) over the past 18 months.

(MAS) reduced its workforce from 22,700 to 19,700 in 2006, and will lose another -500 to -700 this year, as retirees are not replaced and contracts expire, he noted. As previously reported, it has a Request For Proposal (RFP) out for up to 55 narrowbodies and expects to issue a widebody (RFP) for an undetermined number of airplanes in a few months.

August 2007: Malaysia Airlines (MAS) recorded a second-quarter net profit of +MYR113 million/+$32.4 million, improving its performance from a -MYR177 million loss a year earlier and marking its fourth straight profitable quarter since the February 2006 launch of its Business Turnaround Plan. Sales leaped +17% to MYR3.55 billion, while yield grew +13% and load factor lifted +1.2 points to 70% LF on a +3% rise in capacity to 27.84 billion (ASK)s, that was outpaced by a +6% hike in (RPK)s passenger traffic to 19.62 billion. However, cargo numbers were down - - revenue declined -8% to MYR559 million and cargo load factor fell -1 point to 61.8% LF.

CEO, Idris Jala said, "We made good progress, turning an operating profit of +MYR48 million in quarter two, which traditionally has been the airline's worst financial period. But to sustain the airline's profitability, we need to make radical changes."

Six-month profit of +MYR246 million was a reversal from a -MYR498 million loss in the year-ago semester. (MAS) is targeting a full-year net profit of +MYR300 to +MYR700 million, and Jala said it expects a record result thanks to one-off gains related to airplane sales, Thomson Financial reported. The previous record was a +MYR460 million profit in 2003, the news agency said.

(MAS) appointed George Snyder as its Senior Technical Consultant, Safety & Security. Snyder was closely associated with the operational and safety turnaround at Korean Air (KAL) in the early part of the decade, when he served there as Senior VP Corporate Safety, Security & Compliance. Prior to that, he was US Airways (USA)'s VP Safety & Regulatory Compliance.

September 2007: The Singapore and Malaysia governments stated that unlimited access to the Singapore - Kuala Lumpur route, which a number of carriers have expressed interest in operating, will not be allowed until at least the end of 2008.

October 2007: Kuala Lumpur - Singapore service is set to see a major price war erupt after the Malaysian government decided to abandon its protection of the route and several others, well ahead of the originally scheduled January 2009 date. Malaysia Airlines (MAS) CEO, Idris Jala said, "Whilst we are all for fair competition, and we believe in the concept of open skies, we are disappointed that the Kuala Lumpur - Singapore route will be prematurely opened to limited flights." He added, "We needed time to put (MAS) strongly on the path of growth, as we are working on a number of major initiatives to ensure sustained profitability. We will now need to fast-track these plans."

The Centre for Asia Pacific Aviation said it expects traffic to treble in just three years, as AirAsia (ASW), Jetstar Asia (JSA), and Tiger Airways (TGR) enter the route as early as December. The Singapore government is expected to rubber stamp Malaysia's change of heart on liberalization, which also includes routes between Singapore and Penang, Kuching and Kota Kinabalu.

747-4H6 (25700), Penerbangan Malaysia Berhad sold to World Airways (WLD), to be converted to freighter.

November 2007: Malaysia Airlines (MAS)'s resurgence continued in the third quarter as net profit soared +51.7% year-over-year to a record +MYR364 million/+$106 million from +MYR240 million, the carrier reported, crediting "strong passenger demand and sustained yield improvement" for the result. "This is indeed a very encouraging development, as we have now achieved our [Business Turnaround Plan] profit target, one year earlier than originally scheduled," CEO & Managing Director, Idris Jala said. "Over the last 18 months, we have made radical changes in the way we are operating, simplifying processes to reduce expenses, whilst investing in enhancements to our product and services." But Jala said "there is more to be done" and (MAS) has "426 ongoing initiatives for improving our products and services, to further bring down our costs across the network by another -10% by the next financial year," which will translate into -MYR1 billion in savings. Among those projects are an effort to boost Internet sales in order to reduce Global Distribution System (GDS) charges and an increase in third-party, Maintenance Repair & Overhaul (MRO) work, (MAS) said.

Passenger revenue climbed +12% to MYR2.46 billion, which when combined with the efficiency improvements and gains related to the releasing of airplanes, boosted operating profit +254% to +MYR358 million from +MYR101 million in the third quarter of 2006. Load factor rose +5.1 points to 74.1% LF, and yield was up +7% to MYR0.271.

Looking ahead, Jala said bookings are "very strong" for the fourth quarter, but that the financial result "will be dampened by the impact of higher oil price, like all other airlines."

Nine-month profit was +MYR610 million, which surpassed the company's full-year record of +MYR460 million, posted in 2004, and its 2008 profit forecast of +MYR500 million. It lost -MYR258 million over the first three quarters of 2006, and now has reported a profit for five consecutive quarters.

(MAS) and China Southern Airlines (GUN) expanded their code share agreement to cover 35 weekly flights between Kuala Lumpur and Beijing, Shanghai, and Guangzhou, as well as all (MAS) domestic flights from Kuala Lumpur.

(MAS) signed a Memo of Understanding (MOU) with ATR for 10 ATR 72-500s to be delivered in 2009 and 2010 with options, for five additional ATR 72-500s. The agreement is valued at $285 million including options. The ATR 72-500s, configured with 68 seats, will be operated by wholly owned subsidiary "MASWings." They will be used to expand service in the states of Sabah and Sarawak in East Malaysia. "MASWings" commenced operations in East Malaysia on October 1, and currently operates four F 50s and four Twin Otters. "The new airplanes will enable "MASWings" to expand its capacity by +150%," (CEO), Tengku Azmil Zahruddin said. "This will allow "MASWings" to meet the future demand in air travel within Sabah and Sarawak." In July, (MAS) signed an (MOU) with ATR to acquire 10 ATR 72-500s with options for 10 additional airplanes for "Firefly," another wholly owned subsidiary.

December 2007: Qantas (QAN) and (MAS) Aerospace Engineering, a wholly owned subsidiary of Malaysia Airlines (MAS), signed a Memo of Understanding (MOU) to form a joint venture (JV) to provide airplane maintenance services from Malaysia. Qantas (QAN) (CEO), Geoff Dixon said the new company will target the rapidly growing Asia/Pacific (MRO) market, which is expected to reach $15 billion by 2016. It also will perform overflow airframe maintenance for (QAN) and its subsidiary airlines. Dixon said he was confident the companies would create a world-class yet cost-competitive (MRO). "Qantas (QAN) Engineering will have a significant input into the Management, Engineering and Quality system of the new company, which will commence operations in 2008," he said. (QAN) has for decades contracted overflow engineering work to a variety of (MRO)s in Asia, and the operation in Malaysia will provide it the opportunity to consolidate this work. The (JV) will complement the A$300 million/$257.8 million investment, (QAN) committed earlier to its Australian Engineering operations. "This venture reflects the Qantas (QAN) Group's objectives of growing our aviation-related businesses into growth markets in Asia and the Pacific," Dixon said.

Miascor Catering, a joint venture in the Philippines between Gate Gourmet, Citadel Holding and Malaysia Airlines (MAS), recently broke ground for a new catering facility at Diosdado Macapagal International, also known as Clark International. First phase is to feature a 1,000-sq-m building, designed for 1,200 meals daily, allowing for expansion to 5,000 meals per day. Scheduled to open in June 2008, the new kitchen will occupy 3,000 sq m of land.

(MAS) ordered 20 ATR 72-500s for its wholly owned subsidiaries "Firefly" and "MASWings." Each carrier will receive 10 airplanes, with 10 options earmarked for "Firefly" and five for "MASWings." The deal, excluding options, is valued at $650 million. "Firefly" will take delivery of its first airplane next year, while the first for "MASWings" will arrive in 2009. "Firefly"'s ATR 72-500s are intended for expansion of its network as it establishes hubs at Kuala Lumpur Subang, Penang, Johor Bahru, and Kota Kinabalu, while progressively replacing its F 50s. "MASWings" will expand its services in the states of Sabah and Sarawak, well-known tourist destinations in eastern Malaysia.

January 2008: Malaysia Airlines (MAS) flew 3.55 billion (RPK)s passenger traffic in December, down -0.9% from the year-ago month. Capacity fell -2.3% to 4.8 billion (ASK)s, lifting load factor +1.1 points to 73.9% LF.

2007 statistics: 40.1 billion (RPK)s passenger traffic; -4.7% capacity (ASK)s; +1.7 load factor for 71.5% LF. SEE ATTACHED COMPARISON CHART TO SELECTED OPERATORS - "MAS-2007-STATS."

(MAS) unveiled a five-year growth plan dubbed "BTP2" (Business Transformation Plan 2) in Kuala Lumpur, targeting a minimum full-year net profit of +MYR1.5 billion/+$463.6 million by 2012. (MAS) appears well on its way to achieving that goal after posting a record +MYR610 million profit in the first nine months of 2007, with a forecast of a +MYR700 million profit for the full year. But (CEO) & Managing Director, Idris Jala warned that high oil prices are a "big worry, with (MAS) implementing competitive hedging to mitigate risk." "BTP2" is an extension of the original Business Turnaround Plan revealed in February 2006, that has produced a dramatic improvement after massive losses. Jala also cautioned that there is little separating success from failure, saying that a -5% drop in yield or a -6-point fall in load factor would result in a loss of more than >MYR1 billion. However, he said that if the magnitude of the region's anticipated overcapacity and liberalization is less than anticipated, (MAS) may return a profit nudging +MYR3 billion per year. The airline is aiming for a +MYR1 billion profit in 2008. Jala explained to media that the philosophy behind "BTP2" is "aiming and planning for the best and assuming the worst." He said (MAS) must keep reinventing itself to fend off competition from both full-service and low-cost carriers (LCC)s. The five key platforms of "BTP2" are developing a five-star product, lower structural and operational costs, competitive fares, increased passengers and network growth. (MAS) is examining every element of its operation, and cited the new box meals on short-haul flights, that have been well accepted, while costing less and improving turn times. A key part of the carrier's transformation is its fleet renewal, with a decision to be taken by the end of the first quarter on either the A350 or 787, and A320 or 737-800. On the future of its order for six A380s, (CFO) Tengku Azmil Zahruddin told media that it is still talking, but "progress is not as good."

(MAS) was presented with the Air Transport World magazine's "Phoenix Award," which recognizes carriers that have gone through a life-changing transformation. (MAS) came within months of shutting down in 2006, due to financial losses, but turned itself around through a restructuring program, that contributed to record earnings for the first nine months of 2007.

February 2008: Three years after facing bankruptcy, Malaysia Airlines (MAS) is enjoying record-breaking profits, saying that it achieved a +MYR852.7 million/+$260.7 million net income in 2007, reversed from a -MYR133.7 million loss in 2006, and the best result in the company's 60-year history. Managing Director & (CEO) Idris Jala said (MAS) surpassed its original 2007 target by +184%. It had forecast a +MYR700 million profit last month. It cited strong demand, "sustained yield improvements" and operational improvements valued at MYR2.6 billion for the achievement. "However, we have just arrived at base camp," Jala warned. "From turnaround, we now move to transformation. We must secure our future success in view of the overcapacity and liberalization, which will impact all the airlines' profits and margins." He said (MAS) will move forward with a "radical restructuring" of its procurement, distribution and e-ticketing operations, in an effort to generate an additional MYR1 billion in savings this year.

As Air Transport World (ATW) Magazine's 2008 "Phoenix Award" winner, (MAS) enjoyed a +12.4% increase in full-year operating revenue to MYR14.69 billion, against a +5.2% rise in costs to MYR14.41 billion. Operating result swung to a +MYR875.2 million profit from a -MYR201.7 million loss in 2006. It said load factor lifted to 71.5% LF and yield climbed +12% to MYR0.27.

Fourth-quarter net profit of +MYR242.3 million was just under double the +MYR122 million reported in the final 3 months of 2006. Operating profit jumped +75.5% to +MYR260.8 million. "We have come a long way from our -MYR1.3 billion losses and near bankruptcy in 2005," Jala said. "We also have money in the bank, a healthy cash position of MYR5.3 billion, which we will use to grow Malaysia Airlines (MAS)." He said that "barring exceptional circumstances," (MAS) should achieve its "stretch" target of +MYR1 billion in profit this year, and be in position to "double or even triple" that figure by 2012.

(MAS) increased its daily, Delhi - Kuala Lumpur service to 9x-weekly. The route is operated with A330-200s/-300s.

March 2008: Malaysia Airlines (MAS) said it will gain annual incremental revenue of MYR70 to MYR100 million/$22 to $31.4 million, thanks to an "enhanced" hub-and-spoke network, that now includes 25 airline partners and affords customers the opportunity "to connect to most destinations worldwide." Managing Director & (CEO) Idris Jala said, "We are now driving this harder, ensuring that we can extract the maximum value from our network." (MAS) revealed that codeshare agreements with India's Jet Airways (JPL) and Turkish Airlines (THY) will be finalized soon.

(SAA) and (MAS) signed a code share agreement on Johannesburg - Kuala Lumpur route. China Southern Airlines (GUN) and (MAS) signed an expanded codeshare agreement in Guangzhou that will include sales of tickets by each carrier for travel to regional destinations in the other country. (GUN) began code sharing with (MAS) in November on routes to Kuala Lumpur from Beijing, Shanghai, and Guangzhou. "We can expand our route network from Kuala Lumpur to other cities in Malaysia , as well as facilitate Malaysian passengers to reach our more than 100 Chinese domestic destinations," (GUN) Chairman, Liu Shaoyong said at the signing ceremony.

(MAS) announced an order for 35 737-800s and 20 options plus an agreement with Airbus (EDS) regarding the delayed delivery of its six A380s. The narrowbody order is worth $4.2 billion at list prices assuming all options will be exercised. Delivery will begin in September 2010, "when the weakness of the global economy should be less of a concern," (MAS) Managing Director & (CEO) Idris Jala said. They will replace 737-400s. (MAS) said it can swap 737-800s for 737-900s if it chooses. "We will likely partially purchase the 737-800 on our own, and partially lease them, as that would give us the flexibility to manage our balance sheet and financing commitments, and to sell some of them, when the time is right," Jala said.

(MAS) will take its 6 A380-800s in January - August 2011, under an agreement with Airbus (EDS) that "include[s] an agreed amount of compensation for the delay," (MAS) said. It originally was scheduled to take delivery from January 2007 to December 2008. "We are now looking at the wide body airplane replacement, and will intensify our discussions with the manufacturers," Jala said. "(MAS) is committed to expand its network for the medium- and long-haul market."

May 2008: Malaysia Airlines (MAS) cited "higher operating expenses mainly from the increase in fuel costs" for a -9.5% dip in first-quarter profit to +MYR120.5 million/+$37.1 million from +MYR133.1 million earned in the year-ago period. During a quarter that concluded with a large 737 order, (MAS) enjoyed a +5.6% year-over-year increase in operating revenue to MYR3.66 billion but could not offset a +6.5% rise in expenses to MYR3.62 billion. Operating profit slipped -9.5% to +MYR132.9 million from +MYR146.8 million in the 1st 3 months of 2007.

(MAS)'s airline operations segment reported a +MYR64.8 million operating profit with the cargo services segment performing nearly as well at +MYR63.5 million.

(MAS) said its concerns for the second quarter are "managing the high fuel prices, coupled with seasonal soft demand, in view of the shoulder season in Europe, USA and North Asia," and it admitted that increasing fuel surcharges and fares "will alter traveling patterns and frequency" for both business (C) and long-haul leisure customers. "Revenues are under tremendous downward pressure" also because of growing competition and a "huge" capacity increase.

(MAS) said it continues to target a minimum +MYR400 to +MYR550 million net profit for the full year, assuming a jet fuel price of $100 per barrel.

(MAS) is offering 1 million free domestic fares this month to promote its new "Everyday Low Fares (ELF)" program, which Managing Director & (CEO) Idris Jala said "will redefine the rules in the travel industry" if successful. (MAS)'s effort to compete against low-fare giant AirAsia (ASW) will feature nonrefundable 1-way fares of MYR76/$24 and MYR120 between East and West Malaysia, excluding airport taxes and surcharges, and will be available online at least 30 days prior to departure. Jala said there will be no loss in revenue, as the fares represent 30% of surplus seats that otherwise would go unsold. (ELF)s will "only [be] offered on lean flights," (MAS) said. "We have studied our customers' booking profiles very carefully, on a route-by-route and flight-by-flight basis. We know passengers usually book their tickets only within the last 30 days before the flight departs. With Everyday Low Fares, we want them to plan their travels and book early," Jala said. (ELF)s on routes to (ASEAN) destinations such as Jakarta, Bangkok, Manila, Singapore, and Surabaya will be "rolled out soon."

June 2008: Malaysia Airlines (MAS) will reduce capacity by -6% and enact other cost-saving measures, according to Managing Director, Idris Jala, who said (MAS) will "freeze . . . recruitment, defer spending, adjust fares, and review routes and flights, which are losing money," "Thomson Financial" reported from Kuala Lumpur. He said (MAS) also may decline to exercise its option for 20 737-800s that accompanied its firm order for 35 in March.

(MAS) is prepared to "take the lead" in increasing fuel surcharges and perhaps raising fares by as much as +50% in order to negotiate a "frightening" economic environment, Managing Director & (CEO) Idris Jala wrote in an open letter last week. "Change, and I mean drastic change, is absolutely vital for our survival. That, and a willingness to reinvent the way we operate, including through mergers and acquisitions," Jala said. He said (MAS) "kept our head above water" with a first-quarter profit of +MYR120.5 million/+$37 million, but that it will "face more pressure in the near future."
He said that despite "customer resistance," (MAS) will raise surcharges on international flights, will be "focused on cutting costs right down to the bone" - - including cutting capacity - - and will "continue to innovate" to lower costs and increase revenue through programs like its Everyday Low Fares initiative.

July 2008: At the Farnborough Air Show, Malysia Airlines (MAS) placed an order for 35 737-800s valued at more than >$2.6 billion. (MAS) Executive Director & (CFO) Tengku Azmil Zahruddin said the airplanes will replace our existing 737-400 fleet, allowing (MAS) to expand to points which were not previously economically viable." He added that the 737NGs will enable (MAS) better to take advantage of "the fast-growing economies of China and India."

August 2008: Despite operating amid "the perfect storm" of high fuel prices and overcapacity, Malaysia Airlines (MAS) reported its eighth consecutive quarterly profit, a +MYR40 million/+$11.9 million figure that represented a -64.6% decline from the +MYR112.8 million/+$35 million posted in the year-ago period. "It's an extremely tough environment, and with overcapacity and global downturn, the situation is going to get even more challenging," Managing Director & (CEO) Idris Jala warned. He credited the second-quarter profit to (MAS)'s cost and capacity cuts as well as "dynamic pricing" and innovations like its "Everyday Low Fares (ELF)" initiative, which sells surplus seats at reduced fares. He said sales of normal fares also rose once (ELF) was implemented in May. Quarterly revenue climbed +7.9% year-over-year to MYR3.65 billion and expenses were up +9.6% to MYR3.72 billion as fuel costs soared +56%. Operating profit slipped -32% to +MYR62 million from +MYR91.2 million in the 2007 second quarter. The airline operation posted a +MYR17.8 million operating profit and its cargo arm was -MYR48.4 million in the black. Unit revenue rose +7% to 19.2 sen and yield was up +11% to 28.6 sen.

Jala said (MAS) is increasing its commitment to driving ancillary revenue through "travel insurance, hotel and car bookings" and "many more initiatives" including inflight connectivity, mobile check-in, and payment agreements with local banks.

Indonesia's economy grew +6% (year/year) in the second quarter (Q2).

(MAS) said it is targeting a +MYR400 to +MYR500 million full-year profit, based on "into plane" fuel prices of $100 per barrel. For the first semester, net earnings of +MYR160.5 million were down -34.7% from +MYR245.9 million in the year-ago half. Operating profit fell -18.1% to +MYR194.9 million.

(MAS) Engineering & Maintenance (E&M) released a statement attempting to distance itself from reports that it is linked to some of the highly publicized safety and maintenance incidents suffered recently by Qantas (QAN). (MAS) Managing Director & (CEO) Idris Jala said allegations linking the company's (E&M) subsidiary to the ruptured 747-400 hull that forced a diversion to Manila last month are "totally baseless" and that the airplane was maintained in Australia. (E&M) said it has worked only on (QAN) 737-400s. The one airplane on which it has performed heavy Maintenance Repair & Overhaul (MRO) recently was grounded in Melbourne with an air-conditioning problem and Jala said (QAN) "has stated that the air-conditioning fault on the airplane is unrelated to heavy maintenance checks done in Malaysia." He said the "root cause" of a "static/mild electric shock" suffered by a flight attendant (CA) was identified, and while "it is not possible to ascertain if the defect originated from the work at (MAS) (E&M), this will be monitored for future similar work to eliminate such instances from recurring."

(MAS) also defended itself against Australian reports claiming that (QAN) decided not to send two additional 747-400s to (MAS) as a result of problems with the aforementioned airplanes. Jala said (QAN) intends to send only "overflow" airplanes abroad and that space became available in Melbourne to work on the airplane in question.

(MAS) and (GMR) Hyderabad International Airport signed a Memo of Understanding (MOU) to establish a Maintenance Repair & Overhaul (MRO) company at Rajiv Gandhi International capable of handling "all types of airplanes," including the A380. Financial details, ownership structure and timetable for launch, were not disclosed. (MAS) Executive Director & (CFO) Tengku Azmil Zahruddin said the timing was "perfect" for (MAS) to enter the Indian market, which he said "is experiencing strong airplane growth with manufacturers bullish on airplane orders." The companies said they expect 200 new airplanes to enter the market in the next two years and 2,000 in the next 8 to 10 years. " The current (MRO) providers in India are unable to cope with the requirements. Currently, most of the airplanes are sent to Malaysia and other (MRO) providers overseas for heavy maintenance. As such, we will be able to capitalize on these opportunities and position the (JV) company as a leading (MRO) player in the subcontinent," he said, adding that (MAS) Engineering & Maintenance already is training 70 Indian technicians (MT).

September 2008: Malaysia Airlines (MAS) and Etihad (EHD) signed a code share agreement that will extend each carrier’s reach into the other’s home market. (MAS) will place its code on (EHD)’s from Abu Dhabi to Bahrain, Doha and Muscat, while (EHD) will place its code on Malaysia’s flights from Kuala Lumpur to Penang, Kota Kinabalu, Kuching, and Langkawi. Neither carrier belongs to an alliance.

October 2008: Malaysia Airlines (MAS) is postponing its decision on its long-haul fleet renewal owing to current market conditions, (CEO) & Managing Director Idris Jala said at the World Route Development Forum in Kuala Lumpur. "It is clear that we will delay the process to look at a wide body airplane order. We are not in a hurry," he said. (MAS) had anticipated analyzing future wide body requirements in the current quarter to complement its spring commitment for 35 737-800s plus 20 options. It will not defer deliveries scheduled to begin in September 2010. "By that time the present difficulties and crisis will have improved somewhat, so the timing is right," Jala noted. But it may not firm the options. "The 35 737-800s will replace our older narrow bodies, whereas the options were to secure future capacity expansion. If some airlines will go down or slim down their order for 737s, we might pick up some airplanes that way." (MAS) has reduced capacity by -7% year-over-year, during the past 6 months in response to decreasing passenger demand. Jala also said (MAS) "will be holding alliance talks soon, maybe next year," conceding that joining an alliance was impossible until recently. "We achieved a turnaround and built a hub-and-spoke. Now, we have something to offer." (MAS) posted a company-record profit of +MYR852.7 million/+$238.5 million in 2007, reversed from a -MYR133.7 million loss the previous year.

December 2008: Malaysia Airlines (MAS) said it "proved its resilience" with a +MYR38.6 million/+$10.3 million 3rd-quarter profit that, while representing an 89.4% plunge from the +MYR364.6 million profit reported in the year-ago period, was the 9th straight quarter in the black for the restructured airline. "We made money, and this is almost impossible in such adverse times," Managing Director & (CEO) Idris Jala said. "Compared to 2005, when we lost -MYR1.3 billion, we have a strong balance sheet, MYR4.8 billion in cash, and a low debt position. With the credit crunch, and in an environment where financing is almost impossible . . . cash is king. We are in a good position to capitalize and ride on any opportunities that may arise."

(MAS) reported a flat operating revenue of MYR4.12 billion and a +8.9% lift in operating expenses to MYR4.07 billion. Operating profit fell -88.2% to +MYR44.3 million from +MYR376.4 million in the third quarter of 2007, when airplane and property sales helped boost the bottom line. Yield climbed +17% to 31.7 sen and unit revenue rose +11% to 22.1 sen.

Jala warned, "The question now is which airline can innovate fast enough to overcome the challenges. Nibbling at the edges of what used to work is not good enough." He said (MAS) implemented "some 700 initiatives" in the past 18 months, resulting in cost efficiencies of MYR427 million during the quarter, and MYR900 million year to date. (MAS) launched a turnaround time improvement program starting with 737-400s that will free up the equivalent of 1 airplane daily.

Through the 1st 9 months, the company was +MYR199.1 million in the black, down -67.4% from the +MYR610.5 million earned in the year-ago period. Operating profit fell +61.1% to +MYR239.2 million.

(MAS) announced recently that Jala had his contract extended 3 years to November 30, 2011. He joined (MAS) in 2005.

British Airways (BAB) faces some turbulence in its bid to take major equity stakes in both Iberia (IBE) and Qantas (QAN), with (IBE) (CEO) Fernando Conte claiming that (BAB)'s ambitions are "too complex." Speaking at an Aviation Club lunch in London, Conte reportedly argued that it would be "more reasonable" and "more rational" for (BAB) to focus on intra-continental consolidation before trying to strike a transcontinental deal. He also revealed that (BAB) (CEO) Willie Walsh told him about the (QAN) discussions only an hour before (BAB) publicly confirmed them. "I do believe in global consolidation, but at this point, from a regulatory point of view and maybe a political one, we are still not prepared for that," Conte said. "I can tell you very sincerely that (QAN) is a brilliant company. However, I think a merger or collaboration within the European Union (EU) is a totally different scenario from one between companies on different continents." He said he did not have "too much information" about the (BAB)/(QAN) discussions and plans to meet with Walsh in order "to clarify what we are talking about." The Oneworld (ONW) partners confirmed merger talks in July. (IBE) controls 9.9% of (BAB), which in turn holds 13.2% of (IBE). (IBE) insiders have said (IBE) is far from happy with (BAB), as (IBE) has rebuffed overtures from Lufthansa (DLH) and Air France (AFA)/(KLM) in order to pursue the (BAB) equity tie-up.

In Australia, editorial and public opinion appears firmly against a merger, while speculation has erupted in Malaysia that (MAS) also may be involved in talks with (BAB) and (QAN). Reports of talks between (QAN) and (MAS) were not denied by the latter, which remained coy on the subject of consolidation. "We are in talks with a number of airlines on collaborating and creating synergies for growth. This ranges from joint ventures and code shares to interlining partnerships," (MAS) (CEO) Idris Jala told "The Malaysian Insider."

(MAS) is in talks with (QAN) regarding some kind of partnership and intends to "pursue strategic partnerships to create additional value," (CEO) Idris Jala confirmed. "We are in talks with a number of airlines, including (QAN). This ranges from joint ventures and code shares to interlining partnerships. More details will be announced as and when we have finalized the terms of any of these partnerships," Jala said. Rumors of an (MAS)/(QAN) relationship gained steam after (QAN) and (BAB) revealed their merger discussions.

Malaysia Deputy Prime Minister and Minister of Finance Najib Razak was quoted as saying that the "present conditions in the world tell us to be creative and innovative provided we can agree on the participation of foreigners on a win-win basis."

(SITA) said (MAS) selected its in-house reservations system as part of a $130 million improvement program. The 10-year deal includes e-ticketing and departure control system upgrades allowing for self-service options including kiosk and Web check-in.

January 2009: 2 737-8Q8's (30702, N164LF; 30703, N161LF), (ILF) 5 year leased. 1 737-86N (32690, 9M-MLC), (GEF) leased.

February 2009: Malaysia Airlines (MAS) reported a +MYR245.7 million/+$67 million profit in 2008, a -69.7% decrease from the +MYR852.7 million earned in 2007 but a result that Managing Director, Idris Jala called "solid" and evidence "that if we set our minds to do the impossible, we can do it." Jala credited "dynamic pricing, optimizing the network, managing cost and innovation" for (MAS)'s 2nd straight full-year profit and a 4th quarter that marked its 10th consecutive 3-month period in the black. Its +MYR46.6 million profit was down -80.8% from the +MYR242.3 million earned in the 2007 4th quarter. He cited the "radical" Everyday Low Fares and Value Fares initiatives as a key innovation last year.

Full-year revenue rose +2.8% to MYR15.04 billion against a +5.9% increase in costs to MYR15.2 billion. Operating profit fell -65.1% to +MYR305.5 million from +MYR875.2 million.

(MAS) will cut capacity by -5% (ASK)s this year and will seek cost savings of MYR700 million to MYR1 billion. "There will be tremendous push for consolidation if airlines cannot get out of the red," Jala said. "We will continue to seek opportunities which provide a solid, and right, platform for (MAS)." (MAS) acknowledged talks with Qantas (QAN) in December. It said it is targeting a -MYR499 million loss to a +MYR50 million profit in 2009.

March 2009: Malaysia Airlines (MAS) is freezing all recruitment, discretionary training and non-essential employee travel.

(MAS) Engineering & Maintenance said it is targeting a +15% year-over-year increase in 2009 revenue to MYR520 million/$142.4 million. Senior General Manager, Mohd Roslan Ismail said 3rd-party revenue has doubled in the past two years to MYR438 million in 2008 and that "there continues to be a high demand for our services." The company also said its Maintenance Repair & Overhaul (MRO) joint venture with (GMR) Hyderabad International is scheduled to be operational by the 3rd quarter of 2010.

Honeywell (SGC) provided upgraded satellite communications equipment to Malaysia Airlines (MAS) that will permit passengers to use mobile phones and Personal Digital Assistants (PDA)s in-flight as part of a pilot program through mid-2009. (SGC)'s HD710 high-speed data satcom unit replaces the high-power amplifier (HPA) with a unit that contains both the (HPA) and a high-speed data unit.

The Malaysian government finally agreed to fund the construction of a new low cost carrier (LCC) terminal at Kuala Lumpur International costing MYR2 billion/$541 million. The promise to build the facility, scheduled to be completed in the 2nd half of 2011, ends an impasse between the government and AirAsia (ASW), which had threatened to build its own exclusive airport just east of the capital in order to ease congestion at the current terminal that can handle only 15 million passengers per year. Malaysia Airports Holdings said the new terminal will have an annual capacity of 30 million passengers.

ATR 72-212A (856, 9M-MWB), delivery for MASwings operations.

April 2009: The relationship between Qantas (QAN) and Malaysia Airlines (MAS) appears to have fizzled following the expiration of a December 2007 Memo of Understanding (MOU) designed to establish the framework for a joint maintenance repair & overhaul (MRO) organization in Kuala Lumpur. The new (MRO) was supposed to launch last year and handle overflow work for both the (QAN) mainline and its subsidiaries. But the project never got off the ground, for reasons that are unclear, and (QAN) confirmed to several news agencies that no further discussions are planned.

(MAS) told a different story over the weekend, with Senior General Manager Engineering & Maintenance, Roslan Ismail telling media that (MAS) "is in discussions with (QAN) for an extension to the (MOU), but we have yet to come to an agreement." But (MAS) acknowledged that "no active discussions are taking place, unless the (MOU) is subsequently renewed," in a stock market release cited by "Sinchew."

In December 2008, (MAS) confirmed reports that the two airlines were discussing an expanded relationship that could include everything from code sharing to a possible merger. No agreement was reached.

According to Melbourne's "Herald Sun," (QAN) sent a single 737 to Malaysia (MAS) for maintenance in 2007 but has not had any work performed in the country since. A (QAN) spokesperson told the paper that the (MRO) (MOU) "resulted from elementary discussions" that did not bind (QAN) to continue working with (MAS). "This is not a case of the (MOU) being dissolved now. It's just that (QAN) has no need to send airplanes to Malaysia for maintenance."

ATR 72-212A (863, 9M-MWC), delivery for MASwings operations.

May 2009: ATR 72-212A (873, 9M-MWD), delivery for MASwings operations.

June 2009: A "collapse in demand" contributed to a -MYR694.8 million/-$196.8 million first-quarter loss for Malaysia Airlines (MAS) compared to a +MYR120.5 million profit in the 1st 3 months of 2008. An operating loss of -MYR137.9 million, reversed from a +MYR132.9 million profit in the year-ago period, was the revitalized company's 1st since the 2006 3rd quarter and resulted from a "triple squeeze - - overcapacity, extreme fuel volatility and a global slump which hit passenger and cargo demand," (MAS) said.

Revenue plunged -26.2% year-over-year to MYR2.7 billion "due to the worst global recession in 70 years," while expenses were cut -20.5% to MYR2.88 billion as (MAS) reduced capacity -11% and fuel prices decreased. Load factor fell -13.1 points and yield rose +4% to 29.5 sen. The passenger airline unit suffered a -MYR42.5 million loss while the cargo segment was -MYR85 million in the red.

Second-quarter demand "is expected to remain soft" but forward booking trends, especially long-haul, are "expected to stabilize into the second half of the year with the various sales incentives planned," (MAS) said, admitting that yields would remain under pressure. (MAS) now expects a full-year net result ranging from a -MYR499 million loss to a +MYR50 million profit.

(MAS) said it could see a hedging gain of +MYR1.1 billion in the current quarter based on the $66 per barrel fuel price on May 29. It was $71 on June 10. "We have also decided not to unwind our fuel hedges to ensure that we remain protected against the volatile fuel prices," Managing Director & (CEO) Idris Jala said. (MAS) has 47% of its 2009 fuel requirements hedged at $103 per barrel. Jala said other cost-cutting programs will net -MYR700 million to -MYR1 billion this year.

(CASC) (CSC)/Airbus (EDS) Customer Services training and support center in Beijing is looking to adjust its business model as more airlines acquire their own full flight simulators (FFS)s, Managing Director Administration & Programs, Michelle Pierre Petit said. The 18,800-sq-m facility, which opened in 1997, includes 2 A320 and one A330/A340 simulators. "More airlines buying their own simulators means we have to also focus on training the trainers," Petit said. The facility has about 20 airline customers, but there currently are 16 A320 (FFS)s in China with more to come. The expected addition of an A380 simulator at (MAS) will present competition on that front as well, Petit said.

July 2009: (IBS) and Malaysia Airlines (MAS) reached a deal for implementation of the AvientCrew crew management system over the next 2 years.

August 2009: Malaysia Airlines (MAS) Fuel hedges helped boost Malaysia Airlines to a +MYR876.3 million/+$250 million profit in the 2nd quarter, which compares to a restated +MYR40 million profit in the year-ago period and is the largest quarterly surplus in (MAS)'s history. (MAS) gained +MYR1.3 billion on its hedges during the quarter compared to a -MYR640 million loss in the 2nd 3 months of 2008. Operating revenue fell -31.8% to MYR2.5 billion and costs were down -19.6% to MYR2.99 billion. Its operational result swung to a -MYR420.8 million loss from a +MYR62 million profit.

"We have managed well in this crisis. While the operating environment remains tough, the load factors have increased [from 56% LF in the 2009 1st quarter to 66% LF in the second] due to our aggressive strategies to boost sales," Managing Director & (CEO) Idris Jala said. "On the domestic front, more passengers are traveling with us. On the international routes, we have performed better than the industry average as we are less dependent on the front end [of the airplane]."

Domestic loads of 69% led (MAS) to increase capacity by +6%, while international seat factor rose +11 points from the 1st quarter to 65% LF. On the promotional front, it said the (MAS) Stimulus Package launched 4 months ago led to MYR93 million in sales.

"Our forecasted booking numbers for the 2nd half of the year are encouraging. With the loads on an upward trend, we will now be able to work on increasing the yield," Jala said. "We will also be ramping up our advertising spend for the rest of the year." He added that (MAS) expects the economy to "recover" in 2010 and that (MAS) plans to increase frequencies to Southeast Asia, South Asia, China and Australia and add "at least" 3 destinations in the Middle East.

Half-year net earnings of +MYR181.5 million were up +13% from the year-ago semester, while the operating loss of -MYR558.7 million compared to a +MYR194.9 million profit last year.

(MAS) will suspend its 3x-weekly, Kuala Lumpur - Stockholm Arlanda - New York (JFK) service in October.

Later, Malaysia Airlines (MAS) Managing Director & (CEO) Idris Jala resigned from (MAS) upon being appointed to join the government as a cabinet minister in charge of a new Performance Management and Delivery Unit. (CFO) Azmil Zahruddin was named (MAS)'s (CEO) effective immediately. Jala leaves (MAS) having overseen one of the more remarkable turnarounds in recent airline industry history. He joined the carrier as Managing Director/(CEO) on December 1, 2005, with little background in air transport, having been recruited from Shell Malaysia. (MAS) faced a life-or-death crisis; its books showed that it would be insolvent and out of business by April 2006, if the rate of loss continued.

Jala presented a Business Turnaround Plan to (MAS)'s board, the Prime Minister and the Ministry of Transport on his 1st day on the job. It identified 4 critical weaknesses at (MAS): Low yield, inefficient network, low productivity, and lack of cost control. By 2007, after implementing a number of Jala's strategies to counter the flaws, (MAS) was enjoying record-breaking profitability. Air Transport World (ATW)'s "2008 Phoenix Award" winner has continued to produce strong results even in the global economic downturn, recently announcing the largest quarterly surplus in its history with a +MYR876.3 million/+$250 million profit for the 3 months ended June 30.

September 2009: Malaysia Airlines (MAS) will add a 6th weekly, Kuala Lumpur (KUL) - Incheon frequency and a 13th weekly, (KUL) - Taipei flight on September 17. Senior General Manager Network & Revenue Management Amin Khan said, "We believe that this is the beginning of air travel recovery and we are starting to see more leisure travel and we expect business travel to pick up as well." Its cargo subsidiary, MASkargo (MKO), launched a weekly, Kuala Lumpur - Senai - Tokyo Narita flight aboard a 747-400F.

(MAS) has appointed Azha Abdul Jalil as its Chief Financial Officer (CFO), filling the role recently vacated by (MAS)'s (CEO) Azmil Zahruddin. Azha joined (MAS) in July 2007 as Senior General Manager Finance. Prior to this, he worked with Shell, where he held 8 differnt roles over 17 years. The previous (CFO) was Azmil Zahruddin, who became (CEO) of (MAS) on August 28, replacing Idris Jala who joined Malaysia's cabinet as a Minister.

"I am pleased to announce Azha's appointment as (CFO)," said Zahruddin. "In the last 2 years, Azha, Idris and I have worked closely on all key initiatives, and Azha's financial advice has been invaluable." He added that as (CFO) Azha will take the lead in cost optimization, the implementation of enterprise resource planning and addressing our financing needs especially for new airplane deliveries.

Lufthansa Systems signed a 5-year deal with (MAS) to provide its Lido RouteManual navigation charts. (MAS) eventually will introduce Lido eRouteManual.

October 2009: Malaysia Airlines (MAS)' new Managing Director & (CEO) Azmil Zahruddin told reporters in Kuala Lumpur that (MAS) will accelerate its "business transformation plan" with a focus on lowering costs while raising service standards. (MAS) has performed well this year despite the global economic downturn, posting a record +MYR876.3 million/+$250 million profit in the 2nd quarter due to a massive +MYR1.3 billion gain on its fuel hedges. Nevertheless, Azmil said reforms are "critical in light of the industry's worst losses ever. We will focus on 3 core areas: Enhancing customer satisfaction, generating revenue and intensifying structural cost reduction. This [is] a 2-pronged approach: Address current operational losses and position the airline for growth."

(MAS)'s positive 2nd-quarter net earnings masked the reality of its operating revenue falling -31.8% to MYR2.5 billion, resulting in an operating loss of -MYR420.8 million. Azmil, who replaced Idris Jala in late August, said (MAS) "must get customers to continue flying with us. They must also be willing to pay a premium to fly with us. We will concentrate on serving customers better, enhancing in-flight experience including food, website experience and cabin serviceability." He said (MAS) plans to open up more distribution channels, implement a more aggressive sales strategy and place a greater focus on targeted market segmentation. But he emphasized that it has no intention of turning into a low-cost carrier (LCC). "We are a full-service carrier with a vast network and superior services," he said.

(MAS) also is proceeding with a fleet renewal plan including delivery of 35 737-800s starting in the 2010 4th quarter. The airplanes will be deployed in Malaysia, South Asia, China, and Australia. Its 6 A380s will begin delivering in 2011 to be used on high-density routes such as Kuala Lumpur to London Heathrow, Sydney and Amsterdam.

Azmil said the carrier is aiming at reducing structural costs by -MYR700 million this year, building on the MYR2 billion saved over the past 3 years. It also intends to grow its cargo operations as well as its Maintenance Repair & Overhaul (MRO) business. He said MASkargo (MSK) aims to return to profitability next year, while (MAS) Aerospace Engineering aims to achieve revenue targets of MYR1 billion by 2010 and MYR3 billion by 2013.

Malaysia’s government expects 19 million tourist arrivals in 2009, which would be -3 million fewer than the 2008 total, not
to mention the lowest figure since 2006. Nevertheless, air
traffic at the country’s airports was running +3% ahead of
last year’s levels through July. Airport traffic doesn’t include land and sea arrivals and does include outbound and connecting passengers.

ATR 72-212A (889, 9M-MWF), delivery for MASWings operations.

November 2009: Malaysia Airlines (MAS) returned to the red in the 3rd quarter, reporting a -MYR298.9 million/-$88.2 million loss that represented a reversal from the restated +MYR38.6 million surplus earned in the year-ago period and its 2nd deficit in 3 quarters this year. A precipitous -26.8% year-over-year plunge in operating revenue to MYR2.89 billion, plus a -MYR202.1 million loss on fuel hedges, proved too much for (MAS) to overcome. Nevertheless, Managing Director & (CEO) Azmil Zahruddin said that "fuel prices are on an upward trend [and] hedging is the right policy as fuel prices remain volatile." He added that (MAS) is "seeing some signs of recovery. Our strategy is to continue to strengthen our domestic and (ASEAN) operations and position ourselves for the recovery and growth of the long-haul sector" while offering "competitive and compelling fares." Domestic capacity is set to rise +10% during the current quarter and forward bookings "are looking good," he said.

3rd-quarter operating costs fell -25.5% to MYR3.03 billion and the operating loss of -MYR73.3 million compared to a +MYR44.3 million profit in the 2008 3rd quarter. (MAS) carried 3.3 million passengers during the period and load factor was 76.7% LF. The airline operation suffered a -MYR35.7 million loss, (MKO) cargo a -MYR36.9 million loss and the company's catering arm was +MYR1.1 million in the black.

(MAS) plans to add 2 leased 737-800s next year and has deliveries of purchased airplanes scheduled through 2014.

9-month loss of -MYR117.5 million was a reversal from the +MYR199.1 million profit in the year-ago period. Operating deficit of -MYR632 million compared to a +MYR239.2 million profit last year.

"The outlook for the 4th quarter 2009 continues to be challenging," (MAS) said. "There is an early sign of improvement in passenger and cargo traffic, partly stimulated by intensive marketing campaigns, but yields remain under pressure." (MAS) said its "on target" expectation for the full year ranges from a -MYR499 million loss to a +MYR50 million profit.

(MAS) has transitioned to the (SITA) Reservations platform, part of a 10-year, $130 million contract under which (SITA) will install/manage a variety of (MAS) Information Technology (IT) systems. The changeover to the (SITA) reservation system took 13 hours on November 1 and involved the transfer of almost 1.5 million (PNR)s. (MAS) (CEO) Azmil Zahruddin said, "Upgrading to a new reservations platform is the equivalent of a heart transplant for an airline. >3,000 reservations and ticketing staff have been fully trained in preparation for this change."

The (SITA) Reservations suite of products includes reservations, inventory and distribution with code share, automated schedule and re-accommodation management. (SITA) (CEO) Francesco Violante said that the "successful [MAS] cutover to (SITA) Reservations sets a new industry benchmark for how such a complex project can be delivered with minimal disruption . . . The most striking statistic of all is that only 67 (PNR)s needed to be reworked during the cutover just 0.007%." Under (SITA)'s contract with (MAS), it also has implemented an upgraded departure control system to allow (MAS) to offer self-service options to passengers including kiosk and Web check-in.

SEE ATTACHED "AIRLINE BUSINESS ARTICLE" - - "(MAS)-CEO-NEWS-2009-11."

ATR 72-212A (895, 9M-MWG), delivery for MASwings operations.

December 2009: Pratt & Whitney (P&W) and Malaysia Airlines (MAS) signed a Memo of Understanding (MOU) to establish an engine nacelle repair joint venture (JV) facility in Kuala Lumpur. Ownership will be split 50/50. It is expected to service nacelles, including for non-Pratt engines, from (MAS)'s fleet and also to perform 3rd-party repair work for Asia/Pacific and Middle East carriers. Pratt Global Repair Services VP, Tom Hutton said the (JV) will allow the company "to strengthen our position in the Asia/Pacific region, where the aviation market is expected to see significant growth in the coming decades. Our service experience and technical excellence along with the reputation and fleet size of (MAS) provide this venture with the right ingredients to succeed." The (JV) will become a unit of Pratt's Global Service Partners network and complement its existing nacelle repair operations in Michigan.

Lufthansa (DLH) Systems said Malaysia Airlines (MAS) will use Flight Management System (FMS) data from the Lido/(FMS) navigation database for its new 737-800s.

(MAS) whose current long-haul fleet comprises 747s, 777s and A330s, announced plans to purchase 15 A330-300s for delivery in 2011 to 2016, with options for an additional 10.

(CEO) Azmil Zahruddin said the order is worth up to $5 billion if all options are exercised and will be financed in part through a rights issue, according to press reports. The new airplanes will be used on Asian, Middle Eastern, and Australian routes, and will replace some older planes but also will add new capacity. (MAS) has 6 A380s on order as well, that eventually will operate to Europe and North America, plus 35 737-800s and 20 options.

A spokesperson said that "this decision by (MAS) underscores once again the ongoing popularity of the A330 with airlines around the world" and that the company "look[s] forward to finalizing this order soon."

(MAS) currently operates 13 747-400s, 17 777-200s, 11 A330-300s, three A330-200s and 37 737-400s. Zahruddin said the A330 "can carry more payload and has a longer range compared to our 777s, which we are using now."

"Agence France Presse" reported that (MAS) plans a rights issue worth MYR2.67 billion/$776.5 million. "We expect the listing of the rights issue to be in early March 2010," the (CEO) said. "We are investing in the future. We are looking for funding for the replacement of our fleet. This is the best time to order the new airplanes as we are anticipating recovery."

He also said Airbus (EDS) will pay "in excess" of >MYR330 million in compensation for the delay in A380 deliveries. (MAS) expects its 1st A380 in August 2011 (bumped back from January 2011) and the 6th in January 2012. According to "The Malaysian Insider," (MAS) has decided to purchase the 6 airplanes directly rather than lease them through state-owned Penerbangan Malaysia (PMB), established in 2002 to oversee the assets of (MAS). Acquisition of the A380s, along with ownership of 2 747s and 2 777s, will transfer to (MAS) at a cost of MYR3.19 billion. The (CEO) said (MAS) eventually wants to own at least a 3rd of its fleet.

(MAS) said the deal with (PMB) will add +MYR648 million to its bottom line over a 3-year period. "While leasing ensures that we have flexibility with our fleet, we pay premium for this," Zahruddin said. "With this, we have the option either owning the airplanes or doing a sales and leaseback depending on our requirements." (MAS) was -MYR117.5 million in the red through the 1st 9 months of 2009.

3 747-4H6s (25701, HZ-AWA3; 27672, HZ-AWA1; 28426, HZ-AWA2), leased to Alwafeer Airlines (ALR).

January 2010: Malaysia Airlines (MAS) received shareholder approval for a MYR2.67 billion/$784.6 million rights issue designed to fund future fleet growth and expansion. (MAS) said the rights shares priced at MYR1.6 each will be offered to current shareholders on a one-for-one basis. No date for the issue was announced. (MAS) is aiming to own at least a 3rd of its fleet and is purchasing 6 yet-to-be-delivered A380s, 2 747s and 2 777s from state-owned Penerbangan Malaysia Berhad for INR3.19 billion. (MAS) expects to take delivery of 3 new 737-800s this year.

Mobiqa is providing its mobile boarding pass solution to Malaysia Airlines (MAS) as part of (MAS)'s flymas.mobi suite of applications developed by (SITA).

(MAS) is seeing growth with its Maintenance Repair & Overhaul (MRO) business with contracts with Jet Airways (JPL) and SpiceJet (ROJ).

February 2010: Malaysia Airlines (MAS) reported 2009 net income of +MYR493.1 million/+$147.5 million, double the +MYR245.7 million profit earned in 2008, as a strong 4th quarter enabled it to overcome an uneven year in which it was in the red in the 1st and 3rd quarters.

(MAS) said its full-year profitability was attributable primarily to mark-to-market fuel hedge gains of +MYR1.15 billion. For its 4th-quarter result, (MAS) credited "aggressive domestic and global sales campaigns . . . coupled with the seasonal peak travel season" for a +12% increase in passengers carried to 3.4 million, its highest quarterly total since the 2008 1st quarter. It also pointed to lower fuel costs and "a rebound in the cargo business, which saw MASkargo (MKO)'s revenue increasing +7% [compared to the 2008 4th quarter] to MYR414 million."

4th-quarter profit was +MYR610.6 million,>13 times greater than a +MYR46.6 million profit in the year-ago period, helped by a +MYR581.7 million gain on fuel hedges.

Managing Director & (CEO) Azmil Zahruddin said 2010 will be spent "positioning ourselves to capture the growth" he projects is on tap in the Asia/Pacific region: "By 2013, an additional 217 million travelers are expected to take to the skies within Asia/Pacific." (MAS)'s growth will be achieved via "the modernization of our fleet and expanding our network." It will take delivery of 3 737-800s this year and in December, it announced plans to purchase 15 A330-300s for delivery in 2011 to 2016, with options for an additional 10.

It also has 6 A380s on order, with the 1st slated for delivery in August 2011. It said its "new fleet" in 2015 will comprise "up to" 17 ATR 72-500s, 55 737-800s, 25 A330-300s and 6 A380s, with much of its current fleet (13 747-400s, 17 777-200s, 11 A330-300s, 3 A330-200s and 37 737-400s) retired. (MAS) will move "from a 100% leased fleet to owning at least a 3rd of our airplanes," Azmil said.

"The A380 will serve key long-haul destinations such as London and Sydney, the A330 medium-haul markets, while the 737-800 will be used to strengthen the domestic and regional routes." Azmil noted that the "feasibility" of adding destinations to its network to correspond with future airplane deliveries is being assessed, promising "more details" on route expansion in the 2nd half of the year.

Revenue in 2009 decreased -24.8% to MYR11.31 billion, while expenses lowered -19.7% to MYR12.2 billion. (MAS) operating loss was -MYR628.3 million, reversed from an operating profit of +MYR305.5 million in 2008.

Rolls Royce (RRC) won a long-term TotalCare services agreement with Malaysia Airlines (MAS) covering its fleet of 17 777s powered by (Trent 800)s.

ATR 72-212A (904, 9M-MWI), delivery.

April 2010: Malaysia Airlines (MAS) firmed a December Memo of Understanding (MOU) for 15 A330-300s and added 2 A330-200Fs to the order. Passenger airplane deliveries will begin in the 1st half of next year while the 1st freighter will join the MASkargo (MSK) fleet later in 2011. (MAS)'s A330s will seat 283 passengers across 2 classes. The freighters will be able to carry nearly 70 tonnes up to 3,200 nm. (MAS) currently operates 11 A330-300s and 3 A330-200s. It also has 6 A380s on order.

ATR 72-212A (910, 9M-MWJ), for MASWings operations.

May 2010: Malaysia Airlines (MAS) posted a net profit of +MYR310 million/+$96.5 million for the 1st quarter, reversed from a net loss of -MYR694.8 million in the year-ago period, on a +21% rise in revenue to MYR3.3 billion that it attributed to "the economic recovery which boosted global travel."

Operating income, which included compensation for the delayed delivery of an A380, was +MYR290 million, reversed from an operating loss of -MYR137.9 million in the year-ago period. (MAS)'s traffic increased by +29% (RPK)s, "outperforming the Asia/Pacific's traffic growth of +12% as recorded by the Association of Asia Pacific Airlines." MASkargo (MKO)'s traffic jumped +31% and the airfreight unit's revenue increased +53% to MYR456 million.

Managing Director & (CEO) Azmil Zahruddin said "It has been an encouraging quarter. Both the passenger and cargo business showed strong growth, boosted by the economic recovery and our swift response in capitalizing on the increase in demand. We have increased frequencies to key destinations, launched direct flights as well as introduced a new destination. We are also delighted to see the revival of the front end traffic with the return of business (C) class passengers. We will continue to work on improving our yield."

He added that "fuel price volatility will be 1 of the industry's main challenges this year. Although fuel supply has remained constant, the speculators are back, driving the prices upwards." (MAS) said it is 60% hedged at $100/barrel for 2010 and 40% hedged at $100/barrel for 2011.

737-4YO (24915, 9M--MQQ), ex-(SX-bkl), Oakhill Capital leased and 737-8GQ (35793, 9M-MLD), ex-(N793AW), (AWAS) (AWW) leased.

June 2010: Malaysia Airlines (MAS) starts flying to Bandung (Indonesia) next month.

Code share with Oman Air (OMN).

Malaysia Airlines (MAS) has started selling tickets in Kuala Lumpur through a kiosk powered by Apple’s iPad. The kiosk, developed by (SITA), was launched June 23 in tandem with an unveiling at the information technology (IT) company's annual summit in Brussels.
Azmil Zahruddin, (MAS)'s Managing Director & (CEO) said, “It will mean better queue management at our ticket offices during peak hours, when customers can be redirected to ‘stand-alone’ iPad MHkiosks.” The kiosks will soon use an application developed for Apple’s
iPhone that provides access to ticket sales. “MHdeals is an
iPhone-augmented reality application that uses the (GPS) to determine your location and display the nearest airports from which you can access great deals,” says (SITA) Chief Technology Officer, Jim Peters.
“You simply hold the phone in front of you to view the surrounding airports and select one to view flight offers. Passengers can then book their flights through the MHmobile application, which (SITA) Lab developed and launched for (MAS) last year.” Peters adds, “(SITA) regards these 2 innovations as very significant breakthroughs for the airline industry which is seeking to provide the online public with additional sales channels and attractive functionality to build customer loyalty.”

July 2010: Malaysia Airlines (MAS) will launch 3x-weekly, Kota Kinabalu - Tokyo Haneda service on November 15 aboard a 737-800.

August 2010: Malaysia Airlines (MAS) moved into the red in the fiscal 2nd quarter, but is still planning to add new airplanes to its fleet. In the 3 months to June 30, (MAS) had a net loss of -534 million ringgit/-$170 million, compared with a net profit of +876 million ringgit for the corresponding period last year, (MAS) said.

Operating revenue rose +27% to 3.16 billion ringgit from 2.48 billion ringgit, while operating expenses rose +18% to 3.50 billion ringgit from 2.97 billion ringgit. The 2nd-quarter loss was partly due to a loss of -217 million ringgit/-$69 million from fuel hedging, said (MAS). The quarter also suffers in comparison with last year’s 2nd quarter because in the earlier period (MAS) received a boost due to compensation payments from Airbus (EDS) for delays in (MAS)’s Airbus A380 deliveries, (MAS) added.

For the 1st half, (MAS) posted a loss of -223 million ringgit/-$71 million, compared with last year’s 1st-half net profit of +181 million ringgit/+$58 million. For the 2nd half, the challenge will be strengthening yield and mitigating fuel costs, said (MAS). “There will be more opportunity to increase yield as (MAS) starts to receive new planes,” said (MAS) (CEO) Azmil Zahruddin. “(MAS) has ordered up to 55 737-800s and 25 A330-300s. A total of 3 737-800s [from the airplane order] will be received in 2010, 1 each in October, November and December.” Azmil added, “We have also completed our discussions with Airbus (EDS), and will be taking the 6 A380s. The 1st will be delivered in April 2012.”

(MAS) is developing a new hub in Kota Kinabalu in the eastern province of Sabah, to tap new opportunities and expand its network into China, Taiwan, South Korea, Indonesia, and Australia. (MAS), which now has a single main base at Kuala Lumpur, will base 6 737s, 150 flight crew (FC) and 250 cabin crew (CA) in Kota Kinabalu by June 2011. This eastern hub will be developed over several stages from November 2010 to June 2011, building frequencies and adding new international destinations.

Zahruddin said "This also provides us the opportunity for growth and expansion to new destinations. We currently expect a potential improvement per annum of between 60 million ringgit/$19 million and 100 million ringgit to our bottom line."

Among the new destinations from Kota Kinabalu will be Tokyo Haneda from November 15 and 2x-weekly flights to Osaka from January 15, 2011. In January, (MAS) will also double the number of flights to Seoul to 4 a week. By June 2011, (MAS) will operate daily flights to Taipei and Hong Kong, as well as 4 weekly services to Kaohsiung, Taiwan. Other international destinations in the planning, include cities in China, Indonesia and Australia.

To facilitate access to the new services for customers in the nearby city of Kuching, in the eastern state of Sarawak, (MAS) said it will also increase the number of services between the 2 cities from 14 to 25 a week.

MASkargo (MKO) is considering converting 747-400 passenger airplanes from parent Malaysia Airlines (MAS) into freighters and is also in negotiations to firm up options for +2 more A330F freighters. (MKO) has been relying primarily on 747-200Fs on wet-lease from USA carrier Southern Air (SOF), but (MKO) Managing Director Shahari Sulaiman says (MKO) recognizes it needs to move to newer airplanes. “We are looking at freighter conversions, and one of the options is to receive some of Malaysia Airlines (MAS)’s 747-400s from the passenger fleet.” (MAS) plans to replace some of its 747-400s with 6 A380s it has on order, with 1st deliveries set for April 2012.

Shahari said valuations on 747-400 passenger airplanes are falling, especially in light of Japan Airlines (JAL)’S decision, announced in April, to retire its 36 747-400s by the end of March 2011. The cost of converting aircraft to freighters is expensive, but with 747 passenger airplanes becoming cheaper to buy, freighter conversions are becoming more appealing, says Shahari. He also said (MKO) is considering ordering new 777F freighters because this type has a good reputation in the market. (MKO) has two 747-400F freighters of its own and wet-leases 4 747-200F freighters from Southern Air (SOF).
A 5th 747-200 from Southern Air (SOF) is due to arrive this month, said Shahari. It also has 2 A330-200F freighters on order, with options for +2 more. The 1st will be delivered in September next year and the 2nd in November, he said. He also said negotiations are underway to convert the options into firm orders. “What we are trying to do is move away from a simple model of having just 1 airplane type.”

On “some routes it is better to move to a smaller airplane and have more frequencies,” says Shahari, adding that the 747s will continue to serve long-haul routes that the A330s will take over (MKO)’s intra-Asian routes.

Malaysia Airlines (MAS) (CEO) Azmil Zahruddin said (MKO) wants the 3rd and 4th A330F freighters delivered in the 1st half of 2012.

(MAS)'s turboprop operation Firefly (FFM) is planning to add 737s to
compete directly against low cost carrier (LCC) AirAsia (ASW), as well as moving into its hub airport. Industry sources said (FFM) plans to add 737-400s as early as this year and it will start competing on routes served by (ASW). (FFM) operates a fleet of 7 ATR 72-500s. It started operations in early 2007 and has until now refrained from directly competing against (ASW). It has instead focused on serving domestic and international destinations that are underserved by major carriers or destinations that can only be served using turboprop airplanes. Industry sources say Firefly (FFM) is profitable and is now looking to add 737-400s for major domestic trunk routes, particularly those routes linking West and
East Malaysia. As a consequence, (FFM) will be establishing a base at Kuala Lumpur International Airport, home of (ASW). (FFM) has its main base at Kuala Lumpur’s Subang Airport, but the authorities only allow passenger airlines to operate propeller airplanes to Subang.

Firefly (FFM) Managing Director Eddy Leong said "(FFM) has submitted an application to relevant authorities for expansion of its operations.” It is unclear where the 737-400s will be acquired from, but (FFM)’s parent, Malaysia Airlines (MAS) has a large fleet of 737-400s that it is phasing out as it takes delivery of 737-800s on order. (MAS)’s 1st 737-800 on order is due to arrive in October.

September 2010: Malaysia Airlines (MAS) increased 5x-weekly, Kuala Lumpur – Yangon service to 7x-weekly.

Baltia Air Lines (BLT) 747-282B (21035, N705BL) has entered (MAS)' Engineering & Maintenance facility at Kuala Lumpur to undergo a full "D" airplane maintenance check.

(MAS) firmed options for 2 A330-200Fs, doubling its order book for the A330-200F variant of the twinjet. The airplanes will be powered by Pratt & Whitney (PRW) (PW4000) engines and will be operated by Malaysia's cargo subsidiary, MASkargo (MKO).

"We are confident that the A330-200F is set to become a game changer in the mid-size freighter market," said (MKO) Managing Director Shahari Sulaiman. "The airplane will enable (MKO) to efficiently match capacity closely to demand on many medium lift sectors across our cargo network, and especially those operating via intra Asia."

737-8FZ (31779, 9M-MLG), Babcock (BBB) leased.

November 2010: Malaysia Airlines (MAS) has returned to the black after recording a +MYR233 million/+$74.2 million net profit for the 3rd quarter ended September 30 on the back of a +15% lift in revenue to MYR3.39 billion from both passengers and cargo.

The profit is a significant turnaround on the -MYR300 million loss in the same period last year and a major improvement over the loss of -MYR533 million in the prior period, which was related to fuel costs. In the 3rd quarter, (MAS) achieved a 78.6% LF load factor, its highest in 15 years, and yield improved +7%.

MASkargo (MKO) saw its 4th consecutive quarter of profits with a +34% revenue increase, with load factors outperforming other airlines in the Asia Pacific by +4% as reported by the Association of Asia Pacific Airlines.

In the 3rd quarter, (MAS) recorded a +16.9% lift in (RPK)s traffic to 27.77 billion, while capacity (ASK)s increased just +2% to 36.61 billion. While belly cargo was up +9.5% to 1.02 billion load tonne kms, (MAS)’s freighter uplift leapt +54.8% to 778.9 million (LTK)s.

Managing Director & (CEO) Tengku Dato’ Sri Azmil Zahruddin said, "We are delighted to be returning to profitability this quarter with both passenger and cargo segments performing well. Amidst a tough operating environment, we have managed to increase passenger load factors and yield. This is due to aggressive domestic and global sales campaigns, competitive pricing coupled with the economic recovery in the Asia Pacific area."

(MAS) has taken delivery of its 1st 737-800 (31779, 9M-MLG), Babcock (BBB) leased, with +2 more to arrive before year end. Financing is in place for all 14 737-800s scheduled to be delivered through 2012. (MAS) also said its 1st of 6 A380s will arrive in April 2012.

Azmil said that (MAS) will continue to strengthen yields by focusing on gaining premium customers and putting in place aggressive sales programs to increase corporate customers. "We are firmly on track with our 5-year (2008 - 2012) business transformation plan (BTP2) and remain confident in the long-term future of Malaysia Airlines (MAS)," Azmil said, noting that "We are in a challenging and unpredictable industry and have to be mindful of the many things–economic fluctuations, rising fuel prices, even volcanic eruptions, that can quickly have an impact on our business."

With the volatility of fuel price remaining a key challenge, (MAS) has restructured its hedge levels to 33% at $93 per barrel from 40% at $100 per barrel.

(MAS)' turboprop operation "Firefly" (FFM) is adding 737-800s, which will be based at Kuala Lumpur International Airport (KLIA). (FFM), which already has ATR 72-500s at Kuala Lumpur Subang Airport, has secured leases on 737-800s and plans to launch services on January 15 from (KLIA) to Kuching and Kota Kinabalu, East Malaysia, said (FFM) Managing Director Eddy Leong.

These 2 routes will start with 2x-daily services and increase to 3x-daily and 4x-daily for Kota Kinabalu and Kuching, respectively, said Leong. It has already secured leases on 4 737-800s for delivery next year and is in the market to lease +2 more for delivery in 2011, said Leong. The airplanes were sourced from “the open market,” he said. (FFM) will have a total of 6 737-800s next year, followed by 7 in 2012, 7 in 2013, 5 in 2014 and 5 in 2015, he said.

(FFM) plans to decide in next year’s 3rd or 4th quarter on an order for about 30 airplanes, with 1st deliveries in 2013 or 2014, said Leong. Even though (FFM) has chosen to lease 737-800s, it will consider the A320 when it comes to placing an order, he said. (FFM) will initially focus its jet operations on domestic routes but later plans to expand internationally, with destinations in Southeast Asia high on its list, said Leong. “Make no mistake, our fares will be extremely competitive,” said Leong, who unveiled introductory one-way fares of 9 ringgit/$3. “Our cost [per (ASK)] will be the lowest in Malaysia,” he said, adding that the 737-800 has 189Y seats, compared with the A320, which has 180Y seats. Firefly (FFM)’s major competitor, AirAsia (ASW), operates A320s. “We can leverage our costs on our existing (FFM) turboprop operation’s infrastructure and expertise. (FFM) will also leverage off (MAS)’s expertise, especially in Engineering.”

In terms of market positioning, he said “We won’t be cannibalizing (MAS) because (MAS) focuses on premium travel, and we focus on value and the price sensitive market.” (FFM), which celebrated its 3rd anniversary in April, is based at Subang Airport but has to establish its jet operations at (KLIA) because the authorities allow only passenger carriers to serve Subang with turboprops. Firefly (FFM) has a fleet of 7 ATR 72-500s with +3 more on order. The last is due to come in January next year, said Leong. He said (FFM) has agreed with the manufacturer to purchase more ATR 72s. But he declineds to elaborate, because the purchase is still awaiting approval from (MAS)’s board.

AirAsia (ASW) responded to (FFM)’s announcement by offering 1 million seats at zero fares. “We have 96 airplanes and built a network of 145 destinations. We only fear ourselves,” (ASW)’s Group (CEO) Tony Fernandes said in a reply email to a query from "Aviation Week." He says (ASW) will continue to expand at a faster rate than (FFM). Fernandes also said (ASW) has a stronger brand and a lower cost base than Firefly (FFM).

(MAS) received its 1st 737-8H6 (40128, 9M-MXA - - SEE PHOTO - - "MAS-737-8H6-2010-11"), ordered directly from Boeing (TBC), complete with a newly designed livery and outfitted with (TBC)’s new "Sky Interior." It will use the 737 to serve Tokyo Haneda from Kota Kinabalu. Another 2 units will arrive before year’s end. The delivery coincided with USA Secretary of State Hillary Clinton’s visit to Malaysia. One of her stops was Kuala Lumpur’s Subang International Airport.

December 2010: Malaysia Airlines (MAS)’s turboprop operation
Firefly will have 10 ATR 72-500s by the end of January and it is poised to place an order for +4 more. “The 9th one will be delivered as planned on December 27 and another in January 2011,” said Firefly (FFM). “Entry into service (EIS) will be 1 month from delivery date upon thorough pre-service checks.” The 2 airplanes will be used to strengthen (FFM)’s current network footprint and “reinstatement of some Penang-based routes that were previously suspended as a result of a network rationalization due to unfavorable economic conditions.” (FFM) Managing Director Eddy Leong said, “(FFM) is negotiating for an additional 4 ATR 72-500s to be delivered in 2011/12 to fuel its expansion into more secondary routes.”

In a separate development, (FFM) is launching its 1st jet operation on January 15 with 2 189-seat, 737-8Q8s (30702, 9M-FFA) on wet-lease from (MAS) and an ATR 72-500 (941, 9M-FYJ).

737-8FZ (3503-31793, 9M-MLI) and 737-8H6 (3495-40130, 9M-MXC) deliveries.

February 2011: Malaysia Airlines (MAS) reported 2010 net income of +MYR237.3 million/+$77.6 million, down -54.6% from a +MYR522.9 million profit in 2009 that benefited from a +MYR1.16 billion derivative gain.

Despite the earnings drop, (MAS) promised to press ahead with aggressive expansion. (MAS) took delivery of 3 737-800s in the 2010 4th quarter and will receive +4 more 737-800s this year. A

Additionally, (MAS) in April will take delivery of the 1st of 5 A330-300s slated to arrive in 2011. Managing Director & (CEO) Azmil Zahruddin said, "We have put in solid building blocks and are positioning ourselves to capitalize on the action in our backyard, with Asia/Pacific demonstrating strong growth."

Full-year 2010 revenue grew +14.5% year-over-year to MYR12.98 billion, while expenses heightened +9% to MYR13.32 billion. Operating profit was reported at +MYR263.8 million, reversed from a reported operating loss of -MYR614.8 million in 2009. Full-year traffic increased +15% to 37.84 billion (RPK)s on a +3.7% rise in capacity to 49.62 billion (ASK)s, producing a load factor of 76.2% LF, up +7.4 points.

(MAS) said its 4th-quarter yield improved +6% compared to the 2009 December period as (RASK) heightened +6% to MYR0.188 and (CASK) decreased -7% to MYR0.175.

Looking at 2011, Zahruddin remained cautious, citing already high fuel prices that are rising even further owing to Middle East unrest, as well weak economies in Europe and North America. "Competition is also expected to intensify. In a challenging and unpredictable industry such as this, we are vulnerable to many things beyond our control which can quickly have an impact on the business."

Ancra International has a Malaysia Airlines (MAS) contract for 4 firm Main Deck Cargo Loading Systems (MDCLS) for their 4 recently ordered A330-200F airplanes for Maskargo (MKO). Malaysia is now the 8th company to select the Ancra A330-200F (MDCLS).

March 2011: Malaysia Airlines (MAS) launched a (SITA)-developed distribution channel for ticket sales — an application for Facebook called "MHbuddy." The Facebook-integrated application allows customers to book and check-in for a flight directly on the social networking platform, sharing travel details with friends.

Recaro Aircraft Seating received an order from Malaysia Airlines (MAS) for Recaro Comfort Line 6510 seats for its A330-300 fleet. (MAS) took delivery of its 1st airplane equipped with Recaro seats on April 14.

See video "MAS FIRST AND BUSINESS CLASS" - -

May 2011: Malaysia Airlines (MAS) blamed the steep increase in fuel prices and the strengthening of the Malaysian Ringgit for a pre-tax loss of -MYR238.25 million/-$75.7 million for the 1st quarter ended March 31, reversed from a pre-tax profit of +MYR320.25 million in the year-ago period.

(MAS) recorded a +12.8% lift in traffic (RPK)s to 9.89 billion on a +11.2% hike in capacity (ASK)s, pushing load factor up +1.2 points to 76% LF. Cargo traffic, however, fell -8.2% on +4% capacity growth, resulting in a -9.1 point decline in load factor to 68.5% LF.

That decline, plus the strength of the Ringgit, helped drive a -3.3% year-over-year decline in overall 1st-quarter revenue to MYR3.19 billion.

(MAS) said fuel costs rose +32% over the same quarter last year. Managing Director & (CEO) Azmil Zahruddin emphasized that (MAS) remains still focused on its growth strategies, which include acquiring new airplanes and developing an enhanced cabin product.

FireFly (FFM) will launch 2x-daily, Kuala Lumpur service to Sandakan (on August 1), and Sibu (on July 1, increasing to 3x-daily on August 1).

June 2011: Firefly (FFM) launched 2x-daily, Johor Bahru - Kota Kinabalu service.

Australia's Qantas Airways (QAN) will sponsor Malaysia Airlines (MAS)'s entry into the Oneworld (ONW) alliance as it looks to form a close partnership with (MAS) as part of its plan to lift its share of the Asian market.

(MAS) (CEO) Azmil Zahruddin said that the airline had carried out a careful analysis of the alliance options and concluded that "the time is clearly right for our company to join one of the global service groups and the (ONW) alliance is clearly the best option for us."

"The (ONW) alliance already features four of the best airlines in the Asia-Pacific, including member-elect, Kingfisher Airlines (KFH)," said (ONW) alliance (CEO) Bruce Ashby. "Adding another leading Asian carrier, in (MAS), will greatly enhance the (ONW) alliance's offering throughout the world's fast growing region for air travel demand."

(QAN) (CEO) Alan Joyce said (QAN) had been talking to (MAS) for quite some time and would help make the necessary changes for (MAS) to join the (ONW) alliance by the end of 2012. However, he said the entry of (MAS) into the (ONW) alliance would not diminish (QAN)'s presence in Singapore. "I think it opens up opportunities for (QAN) going forward," Joyce said. "However, we will still have a big operation in Singapore." He added, "We are keen to discuss how we can cooperate in the Malaysian and South-East Asian markets. That dialogue will continue; we think there is a lot of opportunity for us to work together."

On the 2nd day of the Paris Air Show, Malaysian Airlines (MAS) ordered 10 737-800s worth $800 million at list prices.

August 2011: Malaysia Airlines (MAS) has blamed soaring fuel prices for a second-quarter net loss of -MYR527 million/-$177 million, similar to the -MYR535 million net loss for the year-ago period, also owing to fuel prices. The loss came despite a +8% lift in revenue to MYR3.48 billion, the result of a +15% increase in passenger revenue to MYR2.08 billion, offset by a -16% drop in cargo revenue to MYR306 million.

Fuel costs were MYR1.55 billion, up +41% compared to the year-ago period, but were balanced by reduced currency hedging losses. Load factor increased +1.5 points to 75.5% LF.

(MAS) said the board “has identified immediate priorities to focus on in the short term” to stem losses. “Working with the new executive committee formed two weeks ago, recovery initiatives will be implemented to turn (MAS)’s fortunes around and to start rebuilding cash reserves,” (MAS) said. Immediate initiatives include managing capacity, implementing pricing to improve yields and revenues, reviewing products and brand positioning and reviewing subsidiary airline Firefly (FFM)’s business.

For the longer term, the executive committee will look to establish a strategic plan to chart (MAS)’s course back to sustainable profitability.

As a result of a partnership announced earlier this month, (MAS) and AirAsia (ASW) formed a joint collaboration committee to look into key areas to realize synergies and reduce costs.

Malaysia Airlines (MAS) and arch rival AirAsia (ASW) are reported to be planning a share swap that would give (ASW)'s parent a 20% stake in (MAS), according to "Reuters." The news wire reported that Malaysia's state investment arm, Khazanah Nasional, which owns nearly 70% of (MAS), would take a 10% stake in AirAsia (ASW). Analysts suggest the deal would enable (MAS) to focus exclusively on premium long-haul services and leave domestic routes and short-haul routes to AirAsia (ASW).

According to the report, (ASW) founder and (CEO) Tony Fernandes and his deputy, Kamarudin Meranun will sit on the (MAS) board following completion of the transaction.

The development has fascinating ramifications for Qantas (QAN) and low-cost subsidiary Jetstar (IMU). In June, (QAN) announced it was sponsoring (MAS)'s entry into the Oneworld (ONW) Alliance and indicated the partnership would be a springboard for growth. In 2010, (IMU) and (ASW) entered into an alliance to reduce costs and pool expertise. At the time, the Centre for Asia Pacific Aviation Chairman, Peter Harbison said the agreement could be the start of something bigger, with code sharing and equity exchanges at a later stage. "This is all about let's live together before we get married," he said.

Later, (ASW), (ASX) and (MAS) announced they have entered into what is termed a Comprehensive Collaboration Framework (CCF), which includes a major share swap and a collaboration agreement to explore opportunities to cooperate on a broad range of areas.

The deal is the first major consolidation in the Southeast Asia region and creates a powerhouse that could set a model for further mergers and joint ventures. As part of the (CCF), 6 (MAS) Directors have resigned and have been replaced with 6 new Directors, including (ASW) (CEO) & Founder Tony Fernandes. 2 (MAS) executives will join the (ASW) board.

According to (ASW), under the (CCF) “all parties will work to complement each other’s businesses so as to leverage on their respective core competencies and optimize efficiency for the benefit of consumers.”

As part of the (CCF), (MAS) and (ASW) are issuing free warrants to each other’s shareholders. A (MAS) shareholder will be granted approximately one warrant in (ASW) for every (30) (MAS) shares held, while an (ASW) shareholder will be granted approximately one (MAS) warrant for every 10 (ASW) shares held.

In addition, Tune Air and Khazanah Nasional Berhad, the major shareholders of (ASW) and (MAS), respectively, have agreed to acquire from each other existing shares of both companies.

As a result, Tune will hold 20.5% of shares in (MAS), and Khazanah will hold 10% in (ASW). In addition, Khazanah proposes to acquire 10% of shares in (ASX) on terms and at a price to be mutually agreed upon later.

According to (ASW), the agreement enables (MAS), (ASW) and (ASX) “to respectively focus on business segments in which they are capable of developing the most value.” The airlines will now assess and review their network services to enhance their offering, which will include partial interlining and flights to new destinations currently not served by any of the airlines.

The first phase of the collaboration will focus on “immediate synergy opportunities, which can be realized without significant effect on any party’s operations.” The (CCF) will become effective immediately upon its execution and shall remain in force for five years, with an option for five more years.

(ASW) (CEO) and (ASX) Director Tony Fernandes said “By focusing on core competencies, it will enable both parties to increase product offerings to our respective customers. (ASW) and (ASX) see growth opportunities in new routes and destinations. Our business model requires us to continue to reduce prices in order to increase volumes for consumers in the low-cost travel segment, which we can now focus on in a more significant way.”

(MAS) Chairman, Nor Yusof added, “The signing of the collaboration agreement heralds an exciting new era of cooperation whereby the airlines involved will stand to gain significantly by tapping the benefits of working together. We believe that the joint collaboration will help (MAS) focus on our strengths in our core markets and work towards deriving higher loads and more efficient resource utilization. We will also be able to offer services in Engineering and other areas to both (ASW) and (ASX).”

(MAS) said it was “continuing with its re-fleeting exercise to strengthen its competitive edge by further enhancing its product and services.” The multi-year fleet renewal program has started with the delivery of five 737-800 airplanes and five A330-300s. The first A330Fs will be delivered next month and six more airplanes (2 737-800s, 2 A330Fs and 2 ATR 72s) will be delivered by the end of the year.

Beyond 2011, (MAS) has firm orders for 38 737-800s, 10 A330s, six A380s and two A330Fs. However, (MAS) said that “in response to the tough operating environment, it is moderating its short-term capacity growth” and will review its current network, adjusting capacity.

According to "The Malaysian Insider," (MAS) is looking to defer some A380 capacity and possibly delay its entry into the Oneworld (ONW) Alliance.

October 2011: The Malaysia Airlines (MAS) Group has launched a network rationalization program with its subsidiary, Firefly (FFM), which will now serve short-haul turboprop routes. (MAS) will focus on enhancing its premium full-service offering, it said. Firefly (FFM)’s turboprop operations will remain unaffected by the restructure.

The takeover is part of service separation plans under the business realignment exercise to address (FFM)’s continuing heavy losses, said (MAS). (FFM) operates two 737-400s and six 737-800s, which will be returned to (MAS).

In the two-month program, all Firefly (FFM) jets will be redeployed into (MAS) operations by December 4.

The first A380 for Malaysia Airlines (MAS) took off for its maiden flight on 20th October after completion of the final assembly and system tests in Toulouse, France. After a successful flight of five hours, the airplane returned to Toulouse to be prepared for its next journey to the Airbus (EDS) facilities in Hamburg, Germany for cabin installation and painting. The Rolls-Royce (RRC) (Trent 900)-powered A380 is the first of six ordered by (MAS), with first delivery scheduled for the second quarter of 2012.

Malaysia Airlines (MAS) used two 747-400s for hajj pilgrimage charters from six Malaysian cities to Jeddah, Medina.

737-8H6 (40133, 9M-MXF), delivery.

December 2011: Etihad Airways (EHD) announced a reciprocal frequent flyer agreement with code share partner Malaysia Airlines (MAS).

Malaysia Airlines (MAS) unveiled a plan to return to profitability by 2013 that includes launching a new regional premium airline, shrinking its network, focusing on costs and making aggressive efforts to win back customers.

The plan targets a net loss of -MYR165 million/-$55 million in 2012, which would be a substantial improvement over (MAS)' net loss of -MYR527 million for just the 2011 second quarter, and estimates a potential 2013 net profit of +MYR1.18 billion - +MYR1.51 billion.

“Malaysia Airlines (MAS) needs to make hard and unpopular decisions simply to survive in order for it to then have the possibility to thrive and realize the airline’s vision,” (CEO) Ahmad Jauhari Yahya said.

(MAS) said that a new regional premium airline will be launched by the second half of 2012 to connect Malaysia to (ASEAN) destinations and key cities in South Asia and Greater China. The new airline will use a fleet of 737-800s. In the longer-term, it will fly all of the domestic and regional routes serviced by (MAS).

(MAS) said it will suspend loss-making routes, including services to/from Cape Town, Johannesburg and Buenos Aires. Capacity (ASK)s will be cut by -12%. But it will also introduce 23 new airplanes in 2012 equipped with state-of-the-art passenger amenities that should drive revenue gains.

(MAS) will cut routes to Europe, Africa and the Middle East starting in January to stem losses and return to profitability. Beginning in January, (MAS) scrap the following routes: daily, Langkawi – Penang – Singapore; 2x-weekly, Kuala Lumpur – Karachi – Dubai; 2x-weekly, Kuala Lumpur – Dubai – Damman; daily, Kuala Lumpur – Surabaya; 3x-weekly, Kuala Lumpur – Johannesburg; 2x-weekly, Kuala Lumpur – Cape Town – Buenos Aires; and 3x-weekly, Kuala Lumpur – Rome route.

(MAS) Group (CEO) Ahmad Jauhari Yahya said: “The withdrawal was based on our own independent internal profitability and yield analysis. This accounts for almost 12% of our passenger capacity and we estimate that the ongoing route rationalization will improve loads, increase yields and have a profit impact of MYR220 - 302 million/$73 - $100 million for 2012.”

(MAS) said it will focus on South Asia, Greater China and North Asia, where the demand outlook is strong, fueled by a growing middle class and increased global and intra-regional trade.

(MAS) will also spin off some ancillary businesses, including its aerospace engineering, pilot (FC) training, cargo and ground services units, for an expected gain of +MYR255 million - +MYR337 million.

January 2012: Malaysia Airlines (MAS) gave a more detailed look at its planned downsizing, the consequence of a severe cash crisis that followed a string of poor financial results. By early next month, (MAS) will have ended all flights from Kuala Lumpur to Surabaya, Karachi, Dammam, Dubai, Rome, Buenos Aires via Cape Town, and Johannesburg, along with Langkawi flights to Singapore via Penang. It will also dismantle its short-lived Kota Kinabalu regional hub, axing service to Tokyo Haneda, Osaka (KIX), Seoul (ICN), and Perth. The cuts represent about 12% of capacity and should improve profits by roughly +$70 million to $90 million this year. In the meantime, (MAS) will work to re-time flight schedules to enhance connectivity at Kuala Lumpur and add more frequencies to key destinations in the (ASEAN) region, the Indian subcontinent, and Northeast Asia.

(MAS) is increasing its weekly frequencies to several (ASEAN) destinations as well as to Beijing (PEK) and Taipei from March 25.

The changes are in line with (MAS)’s business plan rolled out in December to streamline operations, focus on growth and cut losses.

(MAS)’s 2x-daily Kuala Lumpur (KUL) - Manila service will increase to 3x-daily with the addition of another daily 737-800 flight. The (KUL) - Phnom Penh return route will increase from 9x-weekly frequencies to 11 and then to 15x-weekly, effective May 1.

(MAS) is also adding two flights between (KUL) and Jakarta, resulting in 42 weekly services. Connectivity between (KUL) and Medan will double to 2x-daily. (MAS) is adding a flight to Bangkok on Sunday, increasing to 4x-daily, and is doubling its 777-200ER operations to (PEK) to 2x-daily. It will increase its 3x-weekly (KUL) – Taipei – Los Angeles (LAX) service to 4x-weekly and change the routing to (KUL) - Tokyo Narita - (LAX).

(MAS) will also increase frequency on the Kuala Lumpur – Taipei route to daily, with the addition of 3x-weekly 737-800 flights.

(MAS)’s return-to-profitability plan targets a net loss of -MYR165 million/-$55 million in 2012, which would be a substantial improvement over (MAS)'s net loss of -MYR527 million for just the 2011 second quarter, and estimates a potential 2013 net profit of +MYR1.18 billion - +MYR1.51 billion.

737-8H6 (40135, 9M-MXH), delivery.

February 2012: MASwings, the regional subsidiary of Malaysia Airlines (MAS) that launched in October 2007, has introduced new international services from Kota Kinabalu (BKI) and Kuching (KCH) to Bandar Seri Begawan (BWN), the capital of Brunei. The Kota Kinabalu route is less than <200 km and is served 2x-daily with the airline’s ATR 72s. The Kuching service operates 3x-weekly. Brunei is also connected to Malaysia’s capital, Kuala Lumpur, by AirAsia (ASW), (MAS) and Royal Brunei Airlines (RBA). MASwings’ third new route is between Kuching (KCH) and Pontianak (PNK) on the Indonesian side of Borneo. This route will be served daily. These routes are all part of the airline’s plans to grow in the so-called Brunei, Indonesia, Malaysia, Philippines – East Asean Growth Area (BIMP - EAGA).

MASwings, launched a new international route within the island of Borneo on 13 February. The airline now flies from Tawau (TWU) in Sabah on the Malaysian side of the island to Tarakan (TRK) on the Indonesian side (a distance of 125 km). Flights operate 3x-weekly with 68-seat ATR 72 airplanes.

March 2012: Malaysia Airlines (MAS) reported a 2011 fourth-quarter loss of -MYRI 1.28 billion/-$423 million and full-year loss of -MYRI 2.52 billion/-$832 million.

The losses compare to profits of +MYRI 226 million for the year-ago quarter and +MYRI 234 million in 2010.

(MAS)’s fuel costs increased +33% year over year to MYRI 5.85 billion.

Group revenue for the year increased slightly to MYRI 13.9 billion and passenger numbers increased +1.3 million to 17 million.

(CEO), Ahmad Jauhari Yahya promised a raft of “strong measures to stop the bleeding.” (MAS) revealed a return-to-profitability plan at the end of the year. But former Malaysian Prime Minister, Mahathir Mohammad said (MAS) should look to Low Cost Carrier (LCC) AirAsia (ASW) for a way ahead. “AirAsia (ASW) is making plenty of money. They are making profit even though their fares are very low,” he told "Bernama," the national news agency. “So there is something (MAS) can learn from (ASW) in terms of management, cutting down costs and therefore, making a profit.”

(MAS) and (ASW) formed a share swap and collaboration agreement in August.

Malaysia Airlines (MAS) has revealed the design and specifications of its new flagship airplane, the A380-800, which is set to enter the (MAS) fleet in July. New exterior livery mixes traditional “wau” heritage with more contemporary colors.

The 494-seat airplane has a three-class configuration of 8F first-class seats, 350Y economy seats on the main deck, plus 66C business and 70Y more economy seats on the upper deck. For the first time, the airline’s “Chef on Call” service will be extended to business (C) passengers.

The first A380 will operate three-times weekly from Kualu Lumpur to London starting July 1, with the second A380 doubling up on that same route from the end of August. The third A380 will serve Kuala Lumpur - Sydney.

“The investment in this latest A380, its technology, futuristic style and innovative design in cabin comfort are our initiatives to ensure that our passengers continue to experience an exciting new level of comfort, luxury and convenience. This is the identity that will move us from traditional classic to premium contemporary in our efforts to position Malaysia Airines (MAS) as a Preferred Premium Carrier,” (CEO) Encik Ahmad Jauhari Yahya said.

April 2012: Malaysia Airlines (MAS) and AirAsia X (ASX) have signed a re-accommodation agreement following the cancellation of four (ASX) routes to Mumbai, New Delhi, London, and Paris.

(ASX) will use excess capacity on (MAS) flights as it begins to tackle its extensive financial problems. “The related revenue from this arrangement is pure incremental revenue for the airline and would significantly contribute to the profitability of Malaysia Airlines,” (MAS) said, adding that it has already received MYR20million/$6.53 million as prepayment.

Separately, (MAS) and Bangkok Airways (PGB) began a code share agreement on selected domestic flights and international routes between Thailand and Malaysia, (MAS) said.

The agreement, effective March 25, allows MAS to set its MH marketing flight code on (PGB)’s services for Bangkok (BKK) - Koh Samui (USM) (31x-weekly flights), (BKK) - Phuket (HKT) (14x-weekly flights), (BKK) - Chiang Mai (14x-weekly flights), (USM) - (HKT) (14x-weekly flights) and the daily, (USM) - Kuala Lumpur (KUL) service.

(MAS) is also using its new schedule to increase frequencies between (KUL) and Beijing, Manila, Phnom Penh, Los Angeles, Taipei, (BKK), Medan and Jakarta, taking advantage of anticipated increasing demand on these routes.

These sectors will see a gradual increase in capacity from 19,540 seats to 24,820 seats by May 1 and will be operated using mainly 737-800 and 777-200 airplanes.

May 2012: Malaysia Airlines (MAS) reported a first-quarter after-tax loss of -MYR171 million/-$54.3 million, slightly improved from a -MYR242 million loss for the same period last year.

(MAS) said the improved results were “despite higher jet fuel price averaging $135 per barrel during the quarter compared to $120 per barrel in the previous year,” according to a statement.

Total Group revenue stood at MYR3.11 billion, while overall operating expenses were MYR3.42 billion, producing a first-quarter operating loss of -MYR307 million.

“We were able to achieve a lower net loss for the first three months of 2012 compared to the previous year because we made some tough decisions per our business plan. We cut unprofitable routes especially in long haul where yields were low,” (MAS) (CEO) Ahmad Jauhari Yahya said in a statement. “On the cost side, we lowered our fuel bill with improved consumption as a result of newer fuel-efficient airplanes,” he added.

Separately, (MAS) announced details of plans to raise up to MYR2.5 billion/$800 million in Islamic bonds, which it hopes will stabilize its beleaguered balance sheet.

It also plans to lease 6 new A380s and 2 new A330s, valued at MYR5.3 billion, from an external entity. “5 of the airplanes would be delivered in 2012, where the first 2 airplanes are to be delivered by the end of May and another three are to be delivered in the 2nd half of 2012. The remaining 3 airplanes would be delivered in early 2013.”

MASWings is expected to be partially sold to the state governments of the two Malaysian states of Sabah and Sarawak later this year that will then jointly own the majority of the regional carrier so far fully owned by Malaysia Airlines (MAS). MASWings is considering adding 737-800s for international flights from Kota Kinabalu International (BKI) and Kuching (KCH) and seaplanes to serve some destinations in the two states that currently lack airports.

(MAS) is the eighth operator of the A380 following the delivery of its first A380. (MAS) will launch commercial service between Kuala Lumpur and London on July 1.

(MAS) has ordered 6 494-seat A380s with a premium 3-class layout. The (MAS) A380 fleet will be powered by Rolls-Royce (RRC) (Trent 900) engines.

The A380 features include fully flat beds in first (F) and business (C) class, plus new wider seats in economy (Y). Seats in all classes are equipped with individual in-flight entertainment systems, Universal Serial Bus (USB) ports and satellite telephone facilities.

June 2012: An Australian court has fined Malaysia Airlines (MAS) Aus$6 million/$5.98 million for price-fixing linked to a massive international cargo cartel.

Australia’s anti-trust regulator said (MAS)’s cargo division was hit with the fine after it admitted in the Federal Court that it colluded with other airlines on various fuel, security and customs fees.

The admissions related to surcharges on freight from Indonesia between October 2001 and October 2005, a racket in which eight international airlines have already admitted involvement. “This penalty sees the total penalties ordered against this international cartel increase to a record Aus$58 million,” said Rod Sims, Chairman of the Australian Competition and Consumer Commission (ACCC).

“The (ACCC)’s focus on stopping cartel conduct has sent a strong message that cartel conduct is damaging and unlawful because it harms competition and usually inflates prices for consumers,” he added.

Settlement has already been reached with Korean Air (KAL), Japan Airlines (JAL), Qantas (QAN), British Airways (BAB), Cargolux (CLX), Martinair (MTH), and the now-merged AirFrance (AFA) and (KLM).

Cases continue against Singapore Airlines (SIA), Cathay Pacific (CAT), Emirates (EAD), Air New Zealand (ANZ) and Thai Airways International (TII), according to the (ACCC), with proceedings against Garuda Indonesia (GIA) halted pending a High Court challenge.

July 2012: Malaysia Airlines (MAS) is anticipating an extra $100 million in revenue from interlining passengers when it joins the Oneworld (ONW) alliance early next year.

(MAS) currently registers MYR750 million/$235.8 million annually in interlining passenger revenue, Senior VP International Affairs, Germal Singh Khera said at a media briefing. “We are foreseeing the additional revenue to roll in as early as next year, with (MAS) completing all commercial agreements with all other members of the Oneworld (ONW) alliance. We are currently at the last lap of our project to synchronize our system to accommodate the (ONW) alliance members to give our customers a better and holistic network coverage,” he said. (MAS) expects to conclude all work and officially join the (ONW) alliance in the first quarter of next year, Germal said.

(MAS)’s inclusion in the (ONW) alliance also opens up opportunities to forge joint ventures with other airlines in the alliance, he added, specifically mentioning Qantas (QAS).

(ONW) alliance VP Corporate Communications, Michael Blunt said (MAS) will be the (ONW) alliance’s representative in the Southeast Asia region. “We don’t have a representative here. Southeast Asia is a place with many competitor airlines. As such, (MAS)’s inclusion into the (ONW) alliance will serve as the base for the region,” he said.

After (MAS), Sri Lankan Airlines (LNK) will follow and be inducted into the (ONW) alliance.

(MAS) will add 55 extra flights on service from Kuala Lumpur to Medan as well as selected cities within Malaysia August 16 - 28.

As Malaysia Airlines' second A380 is put through its paces in the flying display at Farnborough, (MAS)'s first A380 is now earning money on the Kuala Lumpur - London Heathrow route.

(MAS), which put the 494-seater into service on 1 July, has ruled out earlier plans to offer premium-economy (PY) seating in its A380 fleet. Its A380s are in a three-class layout, comprising 8F first class on the main deck, 66C business class on the upper deck, and 420Y economy seats split between both decks.

(MAS) had originally planned a more spacious "super-economy" cabin in the rear of the upper deck, but this cabin now has 70 seats offering similar leg-room to the 350-seat economy cabin on the main deck. The change enabled around two more rows of business seats to be installed, says (MAS) Group (CEO) Ahmad Jauhari Yahya. "We took premium economy (PY) out because we thought it would be easier for us to sell business class (C), and we think we can manage the yield better through business class (C)," he said, speaking during the A380's Heathrow debut on 2 July.

One novelty is the (MAS) policy to discourage economy (Y) passengers with children from booking seats in the upper-deck cabin until all the main-deck places are allocated, due to concern that noisy children could disturb business-class (C) passengers seated in front of them.

Yahya says that the A380 will go to a daily frequency on the London route from mid-August when the second airplanet arrives. 4 A380s will be delivered this year, and the final 2 follow in 2013. Their arrival will allow (MAS) to retire its 9 747-400s by March next year. Other early destinations earmarked for the (MAS) A380s include Sydney, Tokyo Narita, and Beijing.

Malaysia Airlines (MAS) plans to retire its remaining 7 747-400s currently deployed on the Kangaroo route operating from Kuala Lumpur International (KUL) to London Heathrow (LHR) and Sydney Kingsford Smith (SYD) airports by November 24 according to "Airline Route." It also currently operates some of the airplanes on charter services. The 747-400s on these 2 routes are being replaced by A380-800s with (MAS) expected to have 4 out of 6 on order in operation by November.

737-8H6 (40136, 9M-MXI); A330-323E (1336, 9M-MTH), ex-(F-WWTY); and A380-841 (081, 9M-MNB), ex-(F-WWAJ), deliveries.

August 2012: Malaysia Airlines received its 75th 737 airplane, a 737-800 with the 787 Dreamliner-inspired Boeing "Sky Interior" which features larger pivoting overhead stowage bins, larger window reveals and (LED) lighting to enhance the sense of spaciousness.

Liebherr-Aerospace announced its A380 supplemental cooling system has entered into service, with a delivery to Malaysia Airlines (MAS). The system provides additional cooling to areas such as galleys and the electronic bay.

737-8H6 (40137, 9M-MXJ), and A330-243F (1332, 9M-MTI), ex-(F-WWIH), deliveries.

September 2012: Malaysia Airlines (MAS) increased daily, Kuala Lumpur - Chennai service to 11x-weekly with a 737-800 on September 1.

(MAS) commenced services on the 3,300-km route from Kuala Lumpur (KUL) to the Nepalese capital of Kathmandu (KTM) on September 1. (MAS) now offers 3x-weekly flights on the route to the Nepalese capital, Kathmandu, all of which will be operated using 160-seat 737-800 equipment. (MAS) faces competition from both Nepal Airlines (RNA) and Air Asia X (ASX), which provide 4 and 2 weekly flights, respectively. (MAS)’s Commercial Director, Hugh Dunleavy, said: “We see great potential in Kathmandu. Kathmandu is a hub for independent travellers as well as a growing vacation spot catering to all budgets. Surrounded by serene mountains, it is a perfect place for those who yearn for a relaxing holiday or even a challenging mountain climbing adventure. We also foresee and welcome the labor market traffic from Nepal to Malaysia to use this direct connection.”

(MAS) plans to launch 3 new international services from Kota Kinabalu and increase the flight frequencies of an existing route from Sabah, starting December. (MAS) will operate a total of 7x-weekly services on the 4 routes, using 737-800 airplanes.

"Although we suspended four international routes from Kota Kinabalu in January and February this year, we continued reviewing the situation and are now finalising plans to introduce flights between the Sabah state capital and three cities in the region," (MAS) Group (CEO), Ahmad Jauhari Yahya said.

(MAS) suspended its services from Kota Kinabalu to Osaka Kansai, Tokyo Haneda, Seoul Incheon, and Perth in January and February.

A330-323E (1347, 9M-MTJ), ex-(F-WWCM), delivery.

October 2012: A walk down memory lane for those who can remember Malaysia Airlines (MAS)' original livery, first launched on October 1 1972. SEE ATTACHED - - "MAS-2012-10 - 40 YEARS."

The livery was recently painted on a 737-800 to commemorate (MAS)' 40th anniversary. Notice the moon kite logo in bold red, as well as the words "Malaysian Airline System." The flag carrier, which is due to join Oneworld in February, is now calling this its "Retro Livery".

Starting today, the aircraft is also put on services to Jakarta and Bangkok.

Malaysia Airlines (MAS) will become a full member of the Oneworld (ONW) alliance on February 1. (MAS) received clearance to join the (ONW) alliance after a review of its readiness by Qantas (QAN), which is sponsoring its entry into the (ONW) alliance. The decision to bring (MAS) into (ONW) was announced in June 2011.

(MAS) said its (ONW) alliance implementation program was on track to be completed in the coming months, but formal membership was being delayed to February “to avoid the end-of-year holiday season and for other administrative reasons.”

(MAS) will become the second (ONW) A380 operator, after (QAN).

In August, (MAS) reported a second-quarter net loss of -MYR348.7 million/-$109 million, a +34% improvement on a loss of -MYR525.8 million year-over-year

(MAS) is now not planning to retire the last of its remaining 6 747-400s until the end of February 2013. It currently still uses the 747-400 on Hajj charters to Saudi Arabia and on scheduled flights from Kuala Lumpur to both London Heathrow (LHR) and Sydney Kingsford Smith (SYD).

November 2012: Malaysia Airlines (MAS) has reported a 3rd-quarter net income after tax of +MYR37 million/+$12.1 million, resulting in a small operating profit of +MYR4 million for the period. This reverses an operating loss of -MYR192 million for the year-ago period.

(MAS) attributed the improvement to a route rationalization program that reduced (ASK)s by -7%. This capacity reduction helped cut fuel costs by -9% to MYR1.3 billion for the quarter and non-fuel costs by -7%, but without an equivalent impact on the group’s total revenue, which was down just -2% to MYR3.5 billion.

In the third quarter, (MAS) carried 3.3 million passengers, down just over -1% from 3.35 million during the same period in 2011. Seat load factor was also down at 74.5% LF compared to 75.9% LF year-over-year.

For the 9 months ended September 30, (MAS) has more than halved its operating loss from -MYR975 million in the year-ago period to -MYR405 million. Nine-month net loss after tax improved +61% to -MYR484 million against a loss of -MYR1.247 billion year-over-year.

(MAS) Group (CEO) Ahmad Jauhari Yahya said: “Revenue initiatives have started to gain traction in the market, and combined with the improved utilization of the fleet and our manpower, we are beginning to see the results of all this hard work show in our quarterly results. The combination of the route rationalization program as a key part of our recovery plan, aided by many other revenue initiatives, contributed to the group registering a small profit in the third quarter.”

Separately, (MAS) announced the plan for a capital restructuring exercise followed by a renounceable rights issue to raise up to MYR3.1 billion to improve liquidity and financial flexibility and reduce borrowings. This sent the airline’s stock tumbling more than >-20%, although it has since made a marginal recovery.

The proposed capital restructuring aims to rationalize (MAS)’s balance sheet and reduce accumulated losses by reducing the par value of each existing ordinary share from MYR1.00 to MYR0.90 to help create a credit reserve of up to MYR8 billion. The proposals are expected to complete by the 2013 second quarter.

(MAS) has reached agreement with state-owned Turus Pesawat for a financing arrangement of up to MYR5.311 billion/$1.72 billion to purchase 8 Airbus (EDS) airplanes. The bond will fund the acquisition of 6 A380-800s, 1 A330-200F and 1 A330-300. (MAS) took delivery of its 3rd A380 on November 15, part of its current order for 6.

In August (MAS) reported second-quarter net losses of -MYR348.7 million/-$109 million, up +34% year-over-year and a net loss of -MYR520.1 million for the 6 months ended June 30, a +32% improvement from the year-ago period.

Turus Pesawat is wholly-owned by the Malaysian Ministry of Finance.

(MAS) received its 3rd and 4th A380s. (AAR) (AFD)/(ALC) will sell 10 737-400s to joint venture (JV) partner Malaysia Airlines (MAS). The 737-400s have been on lease to (MAS) since they were acquired by the (JV) in July 2007.

December 2012: Malaysia Airlines (MAS) relaunched flights on the 4,200 km route from Kota Kinabalu (BKI) in the north-west of Borneo to Perth (PER) in Western Australia. The route, which was previously operated by (MAS) for a year before January 2011, is now reinstated with weekly frequency and operated with 737-800s. (MAS) increased its international offering from Kota Kinabalu (BKI) as it launched flights to Shanghai Pudong (PVG) on December 11.

(MAS) has signed a memorandum of understanding (MOU) with French-Italian airplane manufacturer ATR for 36 new ATR 72-600 airplanes worth MYR3 billion/$980 million.

The airplanes are part of expansion plans for (MAS)’s regional subsidiaries, Firefly (FFM) and MASWings. (FFM) will take 20 of the new airplanes, and MASwings the remaining 16.

(FFM) operates a fleet of 12 ATR 72-500s, while MASwings operates 10 similar airplanes. The enhanced ATR 72-600s are scheduled for phased delivery from the end of the 2013 second quarter.

(MAS) (CEO) Ahmad Jauhari Yahya said (FFM) is expected to grow rapidly over the next five years due to a surge in trade movements on domestic routes such as Johor, Penang, Selangor, and Kota Bharu. He said the additional airplanes will be used to expand (FFM)’s network.

MASwings will use the airplanes to boost feeder traffic into the Kuching and Kota Kinabalu hubs for onward connectivity to (MAS).

Launched in April 2007, (FFM) operates out of Penang and Subang, connecting secondary destinations in Indonesia, Malaysia and Thailand as well as Singapore. MASwings was launched in October the same year and operates commuter services in Sarawak and Sabah (Malaysian Borneo), as well as linking those two states to the mainland.

Firefly (FFM) (CEO), Ignatius Ong said the airplane’s technological dynamics and economics fitted (FFM)’s short-hops network.

January 2013: Malaysia Airlines (MAS) is starting to show some signs of progress in its latest turnaround effort, after a year of restructuring and almost constant adjustments to its new business plan. (MAS)’s management team is confident the flag carrier will finally turn the corner in 2013 and that its upcoming entrance into the Oneworld (ONW) Alliance will particularly boosts its outlook. But (MAS) still faces several challenges and there is always a risk of Malaysian politics quickly erasing the positive aspects of the recent restructuring.

(MAS) should not be banking on the Oneworld (ONW) Alliance, which it will formally enter on February 01 2013, being its panacea. Only three (ONW) Alliance carriers serve Kuala Lumpur and relations with (MAS)’ sponsor, Qantas (QAN), cooled significantly earlier this year after talks over establishing a new joint venture (JV) carrier ended.

"Project Orca," which envisioned (QAN) and (MAS) joining forces to establish a new Malaysia-based A330 operator on routes within Asia-Pacific including Australia, was a logical solution for both carriers’ international woes. But (MAS) strongly disapproved of the commercial terms proposed by (QAN) and now that (QAN) has got into bed with Emirates (EAD), it faces the prospect of the carrier which brought it into the (ONW) Alliance, emerging as a bigger competitor rather than a key partner.

Malaysia Airlines (MAS) resumed services on the route from Kota Kinabalu (BKI) in northern Borneo to Osaka Kansai (KIX), which it previously operated with mixed luck on two occasions in the last decade. Beginning on 20 December, (MAS) offers 2x-weekly 737-800-operated flights on the 3,700 km route.

On the eve of joining the Oneworld (ONW) Alliance, (MAS) has rolled out its first airplane in the livery of the global alliance. An (MAS) A330-300 was shown in (ONW) alliance livery along with a 737-800 in (MAS) livery but with the (ONW) alliance logo on the fuselage.

(MAS) said it would paint +2 more of its airplanes in (ONW) alliance livery; the rest of the 88-strong fleet will carry the (ONW) alliance logo.

(MAS) Group (CEO) Ahmad Jauhari Yahya led the ceremony with Qantas (QAN) (CEO) Alan Joyce and (ONW) Alliance (CEO) Bruce Ashby. (QAN), a founding (ONW) Alliance member, sponsored (MAS)’s entry into the alliance. Other (ONW) Alliance (CEO)s also joined the ceremony ahead of (MAS)’s membership, which begins February 1.

The addition of (MAS) to the Oneworld (ONW) alliance brings membership up to 12 carriers serving 842 destinations to 156 countries. It was the “best fit” for (MAS), Group (CEO) Ahmad Jauhari Yahya said.

Two more carriers, Qatar (QTA) and SriLankan Airlines (LNK), have been nominated to join. (MAS) is the first (ONW) alliance carrier from the country, while SriLankan (LNK) will be the first Indian sub-continent carrier and (QTA) will be the first of the “big three” (MEB3) Gulf carriers to join any of the three global alliances.

MASwings ((IATA) Code: MY, based at Kuching (KCH)) (CEO) Datuk Mohd Nawawi Awang has told the "Borneo Post" that the regional carrier owned by Malaysia Airlines ((IATA) Code: MH, based at Kuala Lumpur International (KUL)) (MAS) would have placed an order with Canadian airplane manufacturer Viking Air ((IATA) Code: VKN, based at Victoria International (YYJ)) for 6 DHC-6-400 Twin Otters. The new airplanes will replace the carrier's current three previous generation DHC-6-300 Twin Otter airplanes based in Kuching (KCH) and Miri (MYY) and operating on rural routes to airports in Sabah and Sarawak.

February 2013: Malaysia Airlines (MAS) has formally become a member of the Oneworld (ONW) alliance at a ceremony in Kuala Lumpur. The addition of (MAS) to the Oneworld (ONW) alliance brings membership up to 12 carriers serving 842 destinations to 156 countries. It was the “best fit” for (MAS), Group (CEO) Ahmad Jauhari Yahya said. SEE ATTACHED PHOTO - - "MAS-2013-02 - NEW ONEWORLD MEMBER."

Two more carriers, Qatar (QTA) and SriLankan Airlines (LNK), have been nominated to join. (MAS) is the first (ONW) alliance carrier from the country, while SriLankan (LNK) will be the first Indian sub-continent carrier and (QTA) will be the first of the “big three” (MEB3) Gulf carriers to join any of the three global alliances.

Malaysia Airlines (MAS) has firmed up 20 orders for ATR 72-600s to be operated by its regional subsidiaries. The accord follows a memorandum of understanding (MOU) signed in December for 36 ATR 72-600s; beyond the firm orders, (MAS) took 16 options. Including the options, the deal is worth $840 million. (MAS) regional subsidiaries MASWings and Firefly (FFM) currently operate 22 ATR 72-500s. Deliveries of the ATR 72-600s are slated to begin mid-2013.

March 2013: With AirAsia (ASW) consistently one of the world’s most profitable Low Cost Carrier (LCC) airlines, it stands to reason that the national flag-carrier, Malaysia Airlines (MAS) it challenged at its home base at Kuala Lumpur International Airport (KLIA) is likely to have faced some challenges since 2002 when Tony Fernandes’ creation first took to the skies. The fact that (MAS) has taken until this year to join one of the three big alliances (it joined Oneworld (ONW) Alliance on 1 February), whereas regional rivals such as Cathay Pacific (CAT), Singapore Airlines (SIA), and Thai Airways (TII) have long been members of an alliance, is indicative of the problems (MAS) has been grappling with in recent years.

In December 2011, (MAS) issued a “Business Plan – Our Way Forward” document, the opening line of which pulls no punches by stating: “(MAS) is in crisis”, followed in the next paragraph by, “The core passenger airline business is chronically challenged.” In the Executive Summary the airline reports that:

* More than >40% of our routes are loss-making;

* Our unit cost position is +10 to +15% above corresponding revenues;

* The aviation market has become even more competitive with the rapid increase of the low cost carrier (LCC) segment, continued growth of the Middle Eastern full service carriers and revival in the fortunes of Asian full service carriers such as Garuda (GIA), Japan Airlines (JAL) and Thai Airways (TII).

One of the five cornerstones of the proposed recovery plan was:

* Smaller yet profitable network. Going forward, our network shall include routes where our premium travellers will want to go, and where we can win in terms of competitive position and home advantage. We are shrinking to grow, and as we get back on firm financial footing, we shall expand our network to cover the world’s major economic regions and hubs.

The good news is that in each of the last two quarters of 2012, (MAS) reported a small operating profit, as during the course of the year some 20 new airplanes started to refresh the fleet. These included the first four of (MAS)’s six ordered A380s, which are currently dedicated to (MAS)’s key London and Paris routes. Total network capacity was cut in 2012 by -6%, but passenger revenue only fell -2% thanks to a +4% increase in Revenuer per Available Seat Kilometer (RASK).

In terms of capacity as measured by Available Seat Kilometers (ASK)s, the 2x-daily London service operated by the A380s, is by far (MAS)’s biggest route. Services to Europe (four, in blue) and Australia (four, in yellow) still account for over half of (MAS)’s top 15 routes by (ASK)s, despite an acknowledgement in the 2011 Business Plan that “Our network remains focused on the flows of a previous era, with a significant portion of our capacity concentrated on serving the highly-competed ‘kangaroo route’ connecting Australia to Europe.” The recent agreement between Qantas (QAN) and Emirates Airline (EAD) will not make this market any easier for (MAS) to compete in.

SEE ATTACHED - - "MAS-2013-03 - TOP 15 ROUTES."

Cuts in international services from (KLIA) and Kota Kinabalu. The decision to cut the most unprofitable routes, resulted in early 2012, in the suspension of long-haul routes from (KLIA) to Buenos Aires, Cape Town, Dubai, Johannesburg, and Rome, as well as the withdrawal of flights from Kota Kinabalu to Seoul and Tokyo.

(MAS)’s current schedule sees it operating non-stop to 59 destinations from Kuala Lumpur, with only 13 of these routes not served by another carrier, although the AirAsia (ASW) group of airlines have in the recent past (but not currently) served Delhi, Hyderabad, London, Mumbai, and Paris.

Competition is set to intensify this month with the launch of Malindo Air (MDO) which will start operating on the country’s 2 busiest domestic routes to Kota Kinabalu and Kuching. Furthermore, AirFrance (AFA) and Turkish Airlines (THY) are introducing non-stop flights from Paris and Istanbul this summer, adding further pressure on (MAS).

Australia is the #1 market for capacity (ASK)s from (KLIA). Thanks to non-stop flights from (KLIA) to Adelaide, Brisbane, Melbourne, Perth and Sydney, Australia is the leading country market for weekly (ASK)s from (MAS)’ home base, beating the UK into second place. Whether joining the Oneworld (ONW) alliance will help stimulate traffic between the UK and Australia remains to be seen, but it is notable that British Airways (BAB) does not offer non-stop flights from London to Kuala Lumpur.

SEE ATTACHED - - "MAS-2013-03 - TOP 12 MKTS."

(MAS)' 15 domestic routes from (KLIA) may account for >400 weekly departures, but they still generate fewer (ASK)s than (MAS)’ 14x-weekly flights to London, and account for as little as 10% of (MAS)’ total (ASK)s from (KLIA).

(MAS) is set to take A380 deliveries into 3 figures, nearly 5 and a half years since the 1st airframe was handed over to Singapore Airlines (SIA). Video images of the A380 undertaking taxiing and flight tests have emerged, showing the A380 sporting a "100th A380" marker on its forward fuselage, beneath (MAS)' titles.

(MAS) ordered 6 of the type and 5 have already been delivered. It is 1 of 2 carriers (China Southern Airlines (GUN) being the other) to have received an A380 over the 1st 2 months of 2013.

April 2013: Malaysia Airlines (MAS) will add 3 flights to Kuala Lumpur - Manila 737-800 service, bringing the total weekly flights to 28. 3 flights are also added to Kuala Lumpur - Yangon and Kuala Lumpur - Colombia (both 10x-weekly). (MAS) added daily, Kuala Lumpur - Dhaka 777-200 service. Kuala Lumpur - Brisbane, A330-300 service goes to daily from 5x-weekly June 17.

May 2013: Malaysia Airlines (MAS) reported a 1st-quarter net loss of -MRY279 million/-$91.9 million, widened from a net deficit of -MRY172 million in the 2012 March quarter.

(MAS) is incorporating a fuel surcharge into its fares beginning in June and also announced new "all-in fares." Although it did not report the first quarter loss as a reason for adding the fuel surcharge, higher jet fuel prices and "poor economic conditions" in the region were mentioned in its first quarter operating results.

(MAS) operates its A330s on all 5 of its Australian routes: Adelaide, Brisbane, Melbourne, Perth, & Sydney.

Emirates (EAD) not surprisingly, is the largest foreign airline flying to Malaysia by capacity (ASK)s.

June 2013: 737-8H6 (40147, 9M-MSE), delivery.

July 2013: Malaysia Airlines (MAS) is upgrading its Airbus A380 fleet with Lufthansa Systems (LHS)' Airport Mapping Database Lido/(AMDB), which will provide the data necessary to operate the Onboard Airport Navigation System currently installed on the flight deck.

The Lido/(AMDB) provides detailed information about the layout of airports worldwide, within a geo-referenced layout, including runway geometry and slope. “With Lufthansa Systems’ Lido/(AMDB), we receive precise, up-to-date airport maps that are important to smooth flight operations. This increases the safety of flights, while offering our pilots (FC) the benefits of an integrated system,” said Captain Izham Ismail Director of Operations at Malaysia Airlines (MAS).

(MAS) will install the airport mapping solution onto all 6 of the A380s that it currently operates.
- See more at: http://www.aviationtoday.com/av/topstories/Malaysia-Airlines-Upgrades-A380-Avionics_79676.html#.UeAVEazA5lg

Malaysian short-haul specialist Firefly (FFM) has received the 1st airplane of a major order for ATR 72-600 turboprops.

The regional carrier’s parent, Malaysian Airlines (MAS) ordered 20 of the latest variant of the ATR series in December 2012 and also signed up for a further +16 options. Firefly (FFM) will operate 20, while another Malaysian Airlines subsidiary, MASwings, will take the remainder.

(FFM) already has 12 earlier ATR 72-500s and the new order will enable it both to increase frequencies on its existing network in the (ASEAN) nations (particularly Singapore, Indonesia, and Thailand as well as its domestic Malaysian services) as well as add new points to its route map.

The 1st ATR 72-600 is scheduled to begin operations July 12 with service from Kuala Lumpur’s city terminal, Sultan Abdul Aziz Shah Airport, to Johor Bahru on Malaysia’s southern tip.

The new ATR 72-600 model has a glass cockpit; (FFM)’s airplanes will have a single-class, 72Y-seat configuration.

“We have been looking forward to this day for quite some time now,” Firefly (CEO) Ignatius Ong said. “Our exclusive ATR 72 fleet has allowed us to develop a unique high-frequency network out of Subang, Penang, Kota Bahru and Johor Bahru. The Indonesia-Malaysia-Thailand Growth Triangle communities, their population and economy will also capitalize on this important investment.”

Malaysia Airlines (MAS)’s regional subsidiary, MASwings took delivery of its very 1st ATR 72-600 airplane this month - - SEE PHOTO - - "MAS-ATR 72-600 MASWINGS - 2013-07." The airplane was delivered in a handover ceremony held at the ATR’s facilities in Toulouse and was witnessed by Datuk Ik Pahon, Permanent Secretary Ministry of Tourism Sarawak & Chairman of (BIMP EAGA) – Sarawak Chapter. (MAS) and (ATR) inked a deal in late 2012 for the purchase of a total of 36 ATR 72-600s (20 firm orders plus 16 options) to be operated by the airline’s regional subsidiaries, MASwings and Firefly (FFM).

Based on the agreement between (ATR) and (MAS), MASwings (which currently operates a fleet of 10 ATR 72-500s), will introduce 9 ATR 72-600s until 2017, mostly for further expanding its total fleet. The arrival of the new ATR 72-600s, configured with 72Y seats, will enable MASwings to increase frequencies and open new routes in its network across East Malaysia, as well as to new exciting destinations across Brunei – Indonesia – Malaysia – The Philippines East (ASEAN) Growth Area (BIMP) - (EAGA) region, including Puerto Princessa in Palawan Island, Philippines, which is scheduled to start operation before year end. This new route will complete MASwings’ plan to link the other three countries in the (BIMP)-(EAGA) – Brunei, Indonesia and the Philippines with Malaysia, making MASwings a truly community airline for the region.

MASwings business expansion journey does not end with Puerto Princessa. With its above 90% on time performance annually and carried 1.5 million passengers recorded last year, MASwings is confident with the new addition to its fleet, the targeted 2 million passengers this year would be an achievable mission.

These new ATR 72-600s will also enable MASwings to provide passengers with even higher standards of service and comfort. The new ATR 72-600s of MASwings are equipped with a stylish and widest new cabin in the turboprop market, named ‘Armonia,’ featuring thinner seats, new (LED) lighting and larger overhead bins by +10%, while providing passengers with additional legroom. The airplane has the most advanced glass cockpit in the regional airplane market, specifically developed for (ATR) by Thales (THL), which includes the latest navigation and communication aid tools.

Commenting on the delivery of the airplane, Datuk Captain Mohd Nawawi Awang (CEO) of MASwings highlighted “the great popularity of the ATR 72s in Borneo, thanks to their ability to link a huge coverage of communities and to contribute to the development of tourism and business, aiming for greater service rendered to our passengers would be made possible as some declared the aircraft as – the best way to travel short distance” He added: “We are pleased to further expand MASwings with airplanes featuring outstanding operational capabilities, while burning up to -50% less fuel than regional jets. The development of the environment is a key point of our strategy of growth, and the (ATR)s have consolidated themselves as the greenest regional airplanes in the market”.

Filippo Bagnato (CEO) of (ATR) declared: “The arrival of the ATR ‘-600s’ underlines a new step of a partnership which has proven fruitful since we signed our first agreement in late 2007. Since then, MASwings has strongly succeeded in expanding regional aviation across Borneo and strengthening both human and business links. We are pleased of being part of this story”.

MASwings currently operates 140 flights daily connecting the community in Borneo and beyond, while ATR has some 250 airplanes operating in Asia-Pacific in the liveries of >50 airlines. In recent years, ATRs have positioned themselves as the preferred regional airplanes for Asian carriers. Since 2005, ATR has booked orders for over >330 firm airplanes in Asia-Pacific, representing 2 3rd parts of the total sales of up-to-90-seat regional airplanes in the region.

737-8H6 (40148, 9M-MSF) and A330-323E (1431, 9M-MTM), ex-(F-WWCN), deliveries.

August 2013: Malaysia Airlines (MAS) will not be privatized as efforts to turn the airline around have begun and are beginning to show promise, Malaysian Prime Minister, Datuk Seri Najib Razak has said. Speaking at the Finance Ministry in Kuala Lumpur, Mr Razak noted that although (MAS) has suffered losses, recovery plans in place are beginning to produce results with losses slowly diminishing but, he added, it would take time and patience. Two months ago, Khazanah Nasional, the majority shareholder in (MAS), declared that it expected (MAS)' financial and operational problems to be fully resolved by 2016 though this projection suffered a set back when the Malaysian carrier recently posted a net 1st quarter (Q1) loss of -MYR278.8million/-USD84.6million, up from -MYR171.8million a year ago.

(MAS) resumed flights to the major Middle Eastern hub, Dubai (DXB), from Kuala Lumpur (KUL) after a 19-month hiatus. (MAS) offers a daily service using a 777-200 on the 5,550 km route, which was reinstated on August 5th. (MAS)’s Commercial Director Dr Hugh Noel Dunleavy said, “We see great potential in Dubai. Dubai is a tourism, trade and logistics hub which has earned itself the reputation as being the gateway between the east and the west. Home to just >2 million people of >200 nationalities, Dubai is 1 of the most cosmopolitan cities in the world. With world-class shopping and leisure facilities, Dubai is a popular destination for business and leisure” he said. Competition on the route is provided by Emirates (EAD) who operate 4x-daily flights.

(MAS) increased frequencies on Kuala Lumpur (KUL) - Delhi from 12x-weekly to 2x-daily; (KUL) - Bangalore (from 10x- to 11x-weekly); (KUL) - Cochin, new daily begins October 27 with 737-800s.

September 2013: Malaysia Airlines (MAS), following an 11-year hiatus in flying the route, will link Cochin (COK) in India to its Kuala Lumpur (KUL) hub from 1 September. Operated with a daily schedule, (MAS) will service the 2,923 km route with a 160-seat, 737-800. The route is contested by (MAS)’s long-time low cost carrier (LCC) adversary, AirAsia (ASW), which also flies daily. (MAS) already flies 55 weekly services to India across 5 points: – Bengaluru (10 per week), Chennai (14), Delhi (12), Hyderabad (seven), and Mumbai (12). (MAS) also started Kuala Lumpur to Kochi in India.

(MAS) continues to drive its expansion model with capacity and frequency increases from Kuala Lumpur to both regional and international destinations. Group (CEO) Ahmad Jauhari Yahya, commented: “In recent weeks, we have launched flights to Darwin, Dubai and Kochi in India and increased our services to Brunei and Medan in Indonesia. “Soon, we will add capacity and increase the frequency of our flights to Singapore, Sydney, and Melbourne too.

“As travel to Asian and Australasian destinations continues to grow, we are strengthening our footprint across the region and beyond in response to these market needs.” Passenger traffic throughout 2013 has grown to match the additional capacity and seat loads grew +9.1% year-on-year to reach 83.3% in July.

Since joining the Oneworld (ONW) alliance earlier this year, (MAS) reinstated its Dubai service in August; introduced Kochi as a new destination this month; and plans to launch its Darwin route in November. From November 21, (MAS)’s operations from Sydney will be increased to 18x-weekly, and to 21x-weekly flights from February 5, 2014. Its Heathrow - Melbourne via Kuala Lumpur service will also rise to 3x-daily from November 21.

While larger 737-800 airplanes have been introduced for Brunei operations, a 3rd daily frequency has been added to Medan – bringing it to a total of 6,720 seats a week.

October 2013: Malaysia Airlines (MAS) has introduced international service between Kota Kinabalu (BKI) and Tokyo Narita (NRT). On October 27th, (MAS) began 3x-weekly flights on the 4,130 km route using its 737-800s. Up until the start of the winter season, (MAS) had been serving Osaka Kansai 2x-weekly from Kota Kinabalu. However, this route appears to be making way for the new Tokyo Narita service, and maintains a non-stop link between Kota Kinabalu and Japan. (MAS) does not face any direct competition on the route. Last year, Kota Kinabalu International Airport handled >5.8 million passengers, an increase of +50% since 2004.

November 2013: Malaysia Airlines (MAS) reported a 3rd-quarter net loss of -MRY375 million/-$115.3 million, reversed from a net profit of +MRY37.1 million in the previous quarter.

Malaysia Airlines (MAS) has launched non-stop flights from Kuala Lumpur (KUL) to Darwin (DRW) in Australia. This makes Darwin (MAS)’s 6th destination served non-stop from its home base after Adelaide, Brisbane, Melbourne, Perth, and Sydney. The route was launched on November 1st, and unlike (MAS)’s other Australian destinations, which are all served with wide body airplanes, the 3,640 km Darwin route is served 4x-weekly with a narrow body 160-seat, 2-class 737-800. There is no direct competition on the route.

MASwings, the regional subsidiary of Malaysia Airlines (MAS), started serving Puerto Princesa (PPS) in the Philippines, from its base at Kota Kinabalu (BKI), on November 19th. The 515 km route will be served 3x-weekly (Tuesdays, Fridays, Sundays) using the airline’s ATR 72s. This is the 1st service to Puerto Princesa from any airline belonging to the Malaysia Airlines (MAS) group of airlines.
SEE ATTACHED - - "MAS-2013-11 - PUERTO PRINCESA."

SEE VIDEO MALAYSIA AIRLINES A380 KUALA LUMPUR TO LONDON HEATHROW - -#t=54

December 2013: Malaysia Airlines ((IATA) Code: MH, based at Kuala Lumpur International) (MAS) will temporarily switch its Kuala Lumpur International to Dubai operations from Dubai International to Dubai World Central over the period May 1, 2014 to July 20, 2014. The daily service is being operated by an A330-300. Numerous regional and international carriers have announced contingency plans to cope with the disturbances caused by Dubai International's runway upgrade exercise, set for May to July 2014.

MASwings, the regional subsidiary of Malaysia Airlines (MAS), has introduced 3 new domestic routes, all of which are <150 km in length. T he Lawas (LWY) to Limbang (LMN) route is just 45 km, while the Mukah (MKM) to Sibu (SBW) route is 68 km. All 3 routes began operating on December 16th and are served with 19Y-seat Twin Otters.

Malaysia Airlines (MAS) currently operates 104 airplanes to 30 countries, 85 destinations on 137 routes and 530 daily flights.

February 2014: Malaysia Airlines (MAS) has posted a 2013 net loss of -MRY1.17 billion/-$356 million, nearly tripling (MAS)’s 2012’s net loss of -MRY432.6 million.

2013 revenue for (MAS) rose +9.9% to MRY15.12 billion as 2013 expenses increased +9.6% to MRY14.87 billion, resulting in an operating profit for the year of +MRY254.2 million, up +35.7% year-over-year. “The full-year performance of (MAS) making a bigger loss in 2013 compared to 2012, demonstrates the challenges brought on by intensifying competition leading to lower yields for all players,” Malaysia Airlines (MAS) Group (CEO) Ahmad Jauhari Yahya said. “Many airlines are investing heavily in new airplanes and new products plus services. This has resulted in a significant increase in capacity and aggressive competition in fares and value proposition to attract and keep market share. It makes having to focus on major structural costs review and driving business efficiency for (MAS) even more urgent.”

For the full-year 2013, (MAS)’ traffic rose +27.2% to 47.29 billion (RPK)s on a +17.4% rise in capacity to 58.38 billion (ASK)s, producing a load factor of 81% LF, up +6.3 points from 2012. Yield fell -13% year-over-year to MRY23 sen per (RPK). 17.2 million passengers were transported in 2013, up +28.5% from 2012.

In the 2013 fourth-quarter, (MAS) posted a net loss of -MRY343.4 million, a steep drop year-over-year from the carrier’s +MRY51.4 million profit reported in 2012’s December quarter. Fourth-quarter revenue rose +0.8% to MRY3.9 billion. Expenses increased +7% year-over-year to MRY3.95 billion, leading to an operating deficit of -MRY56.3 million (a significant decline from the carrier’s 2012 fourth-quarter operating profit of +MRY170.6 million).

“We knew 2013 would be a challenging year of intense competition, which would impact yield,” Ahmad Jauhari said. “We expect the pressure on yield to continue. We will intensify efforts to reduce our costs, focusing on inherent legacy costs, while increasing utilization to drive traffic and revenue.”

As of December 31, 2013, (MAS) had received 21 new airplanes during the year, including Airbus A380s, A330s, an ATR 72-600 and one new Boeing 737-800 each month. (MAS)’s total fleet stands at 148 airplanes, including six A380s.

(MAS) recently announced it is suspending service to the USA, ending its Kuala Lumpur - Los Angeles route at the end of April. The move is part of (MAS)’s “route rationalization” exercise aimed at stemming losses.

On February 3rd, Malaysia Airlines (MAS) began flights between its main hub at Kuala Lumpur (KUL) and Krabi (KBV) in Thailand - - SEE ATTACHED - - "MAS-2014-02-KRABI-KUALA LUMPUR." The 650 km route will be served 4x-weekly by (MAS)’s 737-800s and will compete head-on with AirAsia (ASW)’s 2x-daily flights. According to (MAS)' Group Chief Executive Officer, Ahmad Jauhari Yahya, “Malaysia Airlines is excited to expand its network by introducing Krabi as its latest destination.

Krabi is a popular holiday spot and a favorite amongst Malaysians, therefore we are pleased to offer our guests the opportunity to visit Krabi via Malaysia Airlines.” According to (MAS), Krabi, the gem of the Andaman Sea, is abundant with picturesque landscapes, stunning limestone cliffs, beautiful beaches, refreshing waterfalls, breathtaking inland and sea caves, plus riveting underwater. Krabi is home to several National Parks with over >130 surrounding islands such as Koh Phi Phi and Koh Lanta.

(GE) Capital Aviation Services Limited (GECAS) (GEF), announced a purchase-and-leaseback transaction of 4 new 737-800 jet airplanes with Malaysian Airlines System (MAS). The first 2 airplanes delivered in January. The remaining 2 will be delivered in March and April.

(MAS), the flag carrier of Malaysia, operates a fleet of more than >100 airplanes to more than >80 destinations world wide and is a member of the Oneworld (ONW) alliance.

March 2014: News Item A-1: MISSING 777-2H6ER: MH370: Who, Why, How?

On March 7th, Malaysia Airlines (MAS) 777-2H6ER (TRENT 892B-17) (404-28429, /02 9M-MRO), operating Flight MH370, Kuala Lumpur (KUL) to Beijing (PEK) went missing. The 777 was carrying 239 (12 (FC - CA), 227 passengers.

The statement from the Malaysia Prime Minister on the missing Malaysia Airlines (MAS) (MH370) is the worst scenario. Unimaginably awful for the relatives of those on board, who must now deal with a whole raft of possibilities about what happened to their loved ones. And terrible for the airline industry, which once again becomes the weapon of choice for those with ill intent.

It is still unknown where the 777 is, or precisely what has happened to it. But the Prime Minister’s confirmation that the 777’s transponders were deliberately turned off by someone on board and that the 777 likely flew for some hours afterward on a track completely away from its planned flight path is shocking.

(MAS) is correct when it says this is a truly unprecedented situation for the entire aviation industry. Whether this act of sabotage was conducted by a terrorist organization (the Malaysia government says this is not the number one theory of the investigation) or was a criminal act/hostage attempt by an individual or individuals is not known. But the airline industry will take a hit from this.

The immediate priority, of course, remains to find the 777, while simultaneously pursuing a criminal investigation. But it is now also imperative to find the answers to who did this, why and how? All international resources and efforts must be harnessed because of the global significance and implications of this terrible act.

Separately, the industry should begin work on identifying how best to identify and utilize some type of subset of data from the enormous amount of information that modern airliners produce on their health and whereabouts. That capability could potentially prevent a future airliner from simply vanishing off radar and vastly help narrow a search and rescue operation.

The fact is that two of the most recent and catastrophic modern airliner events (that of the AirFrance (AFA) Airbus A330 that crashed into the Atlantic in 2009 and (MH370)) had one thing in common. Both “vanished” from Air Traffic Control (ATC) tracking and both required extensive search efforts.

The airline industry is incredibly safe, transporting some nine million people a day to destinations round the world and with more than >6,000 people boarding an airplane every minute. But new lessons will be learned from (MH370) and new solutions will have to be found. The first priority remains locating the 777. Every effort is being put into the search mission.

The Boeing 777 has an excellent safety record. It has become a much-admired long-haul workhorse of airlines round the world, highly respected for its unmatched efficiency, reliability and safety performance.

Malaysia Airlines (MAS) has a very good safety record. The flag carrier began in 1947 as Malaysia-Singapore Airlines. The present airline was formed in 1971 after the breakup of Malaysia-Singapore Airlines (MSA). Its most serious crash was back in 1977, when one of its 737s was hijacked and crashed, killing all 100 people on board. Its last fatal accident was in 1995 when a Fokker F 50 crashed on approach, killing 34 people.

One thing is certain; whatever the fate of Flight (MH370), the answers ultimately will be known. Speculation will not provide those answers. The tragic mystery of Flight (MH370) will be solved by the dedication and expertise of the international air transport industry, which always comes together and spares no effort to establish and understand the root cause of an airliner event. No timeline will be put on that mission (for evidence of that, look to the 2009 AirFrance (AFA) A330-200 crash) because knowing what happened is the right thing to do for the friends and relatives of the passengers and crew on board. It is also how the global airline industry has advanced safety standards to be far higher than those of any other transportation industry.

Last message from (MAS) flight:

"ALL RIGHT - GOOD NIGHT."

On March 24th, the Malaysia Prime Minister made a public announcement that the (MH370) 777 was declared lost with all on board, located in the Southern Indian Ocean on the basis of Immarsat satellite reports.

News Item A-2: See video - - "What Really Happened to Malaysia Airlines (MAS) 777 Flight MH370?" - -

May 2014: Malaysia Airlines (MAS) has posted a 1st-quarter net loss of -MYR433 million/-$138 million, -59% worse than the year-ago period.

(MAS) said “tough operating conditions” and “negative sentiment” contributed to the widened losses. (MAS) is dealing with the effects of the loss of flight (MH370), a Boeing 777, which disappeared during a routine flight in March and has not been located, despite extensive and ongoing searches.

The majority of the 229 people on board were Chinese and it has been reported that the airline has seen a 60% drop in sales from China. Some Chinese travel agents are boycotting (MAS).

Malaysia Airlines (MAS) (CEO) Ahmad Jauhari Yahya said “The results were made worse with the impact on air travel in general following the disappearance of (MH370). The whole market has reacted by slowing down demand.”

(MAS) “needs to accelerate efforts to improve its revenue stream and better manage our high costs which have increased,” he said. “This need has become even more urgent for Malaysia Airlines (MAS)’ future survival and sustainability in a market that is not showing any signs of letting up on competition. We still have much work ahead of us to deal with the reality of the business and competition as a dynamic and nimble operation,” he said.

“(MH370) has brought out the best of our Malaysia Airlines (MAS) team to stand united to face the crisis. We will be leveraging on this team spirit to fight for our future.”

The concept of using an aviation computing cloud to track flight data in real time gained traction at a two-day conference in Kuala Lumpur focused on improving airplane tracking following the disappearance of Malaysia Airlines (MAS)’ Flight (MH370).

Organized by the International Telecommunication Union (ITU) (a United Nations (UN) agency for information and communication technologies), the two day conference was attended by avionics manufacturers, trade associations and representatives from civil aviation authorities to explore how current technology could facilitate the development of real-time tracking of commercial airplanes. The (ITU) coordinates the shared global use of radio spectrum, and will look to use its expertise in that field to help the International Civil Aviation Organization (ICAO) introduce a new international standard for real-time tracking of airplanes.

(ITU)'s conference is the latest in a string of recent government-industry international gatherings in the wake of the MH370 incident. (ICAO) recently hosted the first meeting of the Airplane Tracking Task Force (ATTF), a panel of aviation industry experts organized by the International Air Transport Association (IATA). The (ATTF) plans on presenting a high level concept of operations for a global airplane tracking service at the 2015 (ICAO) High Level Safety Conference (HLSC).

During the two-day meeting in Malaysia, the (ITU)-hosted "Expert Dialogue" focused on cloud computing technology as a leading element of the future global airplane tracking service that (ICAO) is seeking.
“Thankfully, the number of airplanes which disappear, are not many,” said Ahmad Cheek, Malaysia's Minister of Communication & Multimedia. “But having gone through the experience of (MH370), even one airplane disappearing, is one too many.”

Cloud computing describes the process of storing and accessing data and programs over the Internet, instead of using a computer's hard drive. Information Technology (IT) teams at various government agencies and businesses have adopted the cloud computing model over the last decade, as it essentially allows on-demand network access to a shared pool of configurable computing resources.

Creating an aviation data cloud and permitting access to it for airlines, operators and Air Navigation Service Providers (ANSPs), is a huge undertaking that will require the (ITU) and the (ICAO) to identify the concept of the operation, and determine necessary spectrum requirements and telecommunication standards. British satellite service provider, Inmarsat recently proposed a "black box in the cloud" service, where certain in-flight trigger events, such as an unapproved course deviation, would stream flight data recorder information off an airplane in real-time to approved recipients.

According to the (ITU), participants at the meeting want the (ICAO) and the (ITU) to develop standards that will define requirements on the protection of flight data, information security, and the appropriate use of flight data and data ownership, for the use of an aviation cloud for real-time monitoring of flight data.

"The (ITU) has a long history of harmonizing the use of the radio spectrum and developing international telecommunication/(ICT) standards and is offering to bring this competence to assist aviation, in partnership with the (ICAO), to consider alternative ways of using technology such as cloud computing and big data, to provide these solutions," said Malcolm Johnson, Director of the (ITU)'s Telecommunication Standardization Bureau.

The (ITU) concluded the two day conference by stating that it would continue to study current and future spectrum requirements for global airplane flight tracking and "make appropriate allocations" at the 2015 World Radio-communication Conference.

“This experts’ dialogue provided an opportunity to establish clear actions going forward, in particular related to the (ITU)’s expertise in the fields of radio-frequency spectrum, satellites and the (ICT) standardization,” said Johnson. “It will help instigate an international effort to ensure that an event like flight (MH370) is not repeated.”

Satellite operator Inmarsat has offered to establish a global airplane tracking service over its existing satellite communications network following the loss of Malaysia Airlines (MAS) Flight (MH370).

The Boeing 777-200, with 239 people on board, went missing March 8 during a routine flight from Kuala Lumpur to Beijing. No trace of the 777 has yet been found despite an extensive multinational search effort. However, information gained from satellite data and some pings detected, are believed to have been emitted by the 777’s flight data recorder (FDR), indicating the 777 could be deep on the sea floor in the south Indian Ocean off the coast of Perth.

The proposed system, which Inmarsat said it will offer as a free service, should enable tracking of some 11,000 airplanes equipped with a suitable satellite connection. “Because of the nature of existing Inmarsat aviation services, our proposals can be implemented right away on all ocean-going commercial airplanes using equipment that is already installed,” Inmarsat (CEO) Rupert Pearce said.

He said the use of Automatic Dependent Surveillance-Contract (ADS-C) through the Inmarsat network could be offered “responsibly, quickly and at little or no cost to the industry,” and that it would address some of the issues that led to the still-unsolved disappearance of Flight (MH370). Inmarsat said that “leading aviation safety partners” had already bought into the proposal.

It has also proposed what it calls a “black box in the cloud,” which could stream historic and real-time flight data recorder (FDR) and cockpit voice recorder (CVR) information to aviation regulators or safety authorities, if required. This would not be full time, but would see data uploads automatically start in the event of a range of “trigger events” such as an unapproved course deviation, or a sudden change in altitude.

Inmarsat said the (ADS-C) tracking/upload option should track most commercial passenger airplanes, which is close to 100% of the world’s long-haul commercial fleet.

June 2014: As Malaysia Airlines (MAS) and the Malaysian government start to consider restructuring options, the possibility of a tie-up with Etihad Airways (EHD) has emerged. An (MAS) - (EHD) partnership would be logical for both carriers and have repercussions in the dynamic Southeast Asian marketplace.

(MAS) would initially forge a comprehensive code share partnership with Etihad (EHD), building on the limited code sharing the carriers already have in place. But with (EHD), an equity stake is also always a possibility. Ultimately the ball will be in the Malaysian government’s court to determine if such a scenario is palpable, adding to the difficult decisions the government is already confronted with as (MAS) requires a deep restructuring and potentially out of the box solutions to survive.

Later, however, Malaysia Airlines (MAS) and Etihad Airways (EHD) have both denied they are in talks about an equity sharing deal, despite recent rumors that one was imminent. “With reference to a recent article, (MAS) continues to engage with its code share partners, such as (EHD), on how it can improve further on its relationship with the airlines,” an (MAS) spokeswoman said. (EHD) has seven code shares with (MAS) to regional destinations in Malaysia and Indonesia.

(MAS), still reeling from the disappearance of its Flight MH370, posted a -MYR433 million/-$138 million first-quarter loss, widened -59% from the year-ago quarter. Passenger numbers have also dropped, particularly on Chinese routes, and it has offered various deals to try to win back business.

Tan Sri Azman Mokhtar Khazanah, Managing Director of Malaysian sovereign wealth fund Khazanah Nasional, said investors are considering “a number of scenarios.” Khazanah, which owns 69.4% of (MAS) stock, said it is premature to say which scenario is most likely at this time. In the meantime, (MAS) is sounding out its Oneworld (ONW) Alliance partners. While (MAS) does not need (ONW) approval to forge a relationship with (EHD), it is only courteous (and sound business practice) to give Qatar Airways (QTA) and other (ONW) alliance members an opportunity to come to the table with alternatives.

July 2014: ACCDT: On July 17th, Malaysia Airlines (MAS) Flight MH17 Amsterdam - Kuala Lumpur 777-2H6ER (TRENT 892B-17) (84-28411, /97 9M-MRD) has been shot down by a missile over east Ukraine near Russian border, resulting in all 295 (15 (FC - CA), 280 Passengers) on board being killed.

This sparked a massive international political crisis as evidence pointed to the 777 being shot down by a surface-to-air missile.

Malaysia Airlines (MAS) said that “it received notification from Ukrainian Air Traffic Control (ATC) that it had lost contact with flight MH17 approximately 50 km from the Russia - Ukraine border.”

The flight departed Amsterdam at 12:15 pm local time and was operating a code share with (KLM) Royal Dutch Airlines. The majority of the passengers were Dutch.

The 777 was cruising at 33,000 ft, when contact was lost. Wreckage and bodies are strewn across a wide area on the ground.

The (FAA) said it has been in contact with USA carriers following the crash and that carriers have voluntarily agreed not to operate in the airspace near the Russian - Ukraine border. “The (FAA) is monitoring the situation to determine whether further guidance is necessary.” Most major airlines that fly in the area, a common routing between European cities and Southeast Asia, also announced they would avoid the area.

The (MAS) 777-200ER that crashed over Ukraine, killing all 298 on board, was shot down by a surface-to-air-missile (SAM) from territory controlled by Russian-supporting militants, USA President Barack Obama said. “The shot was taken from territory that was controlled by the Russian separatists,” Obama said.

(MAS), meanwhile, stated that the route for Flight MH17 was approved by Eurocontrol. “MH17’s flight plan was approved by Eurocontrol, who are solely responsible for determining civil airplane flight paths over European airspace. Eurocontrol is the air navigation service provider for Europe and is governed under (ICAO) rules,” (MAS) said.
“The route over Ukrainian airspace where the incident occurred is commonly used for Europe to Asia flights. A flight from a different carrier was on the same route at the time of the MH17 incident, as were a number of other flights from other carriers in the days and weeks before.”

The airline added that in April, (ICAO) “identified an area over the Crimean peninsula as risky.” It said that at no point did MH17 fly into, or request to fly into, this area. “At all times, MH17 was in airspace approved by the (ICAO).”

An (IATA) spokesman clarified that individual states, not (IATA) or (ICAO), determine any restrictions on airspace routes.

According to the Malaysia Airlines statement, MH17 filed a flight plan requesting to fly at 35,000 ft throughout Ukrainian airspace, but on entering Ukrainian airspace, was instructed by Ukrainian air traffic control to fly at 33,000 ft.

This was just 1,000 ft higher than a restriction not to fly below 32,000 ft, because of the combat zone below on the Ukraine - Russia border. (SAM) weapons known to be operating in that area can reach altitudes of 70,000 ft or higher.

(MAS) said it is now avoiding Ukrainian airspace entirely, flying further south over Turkey.

In an address from the White House, Obama called the deaths of almost 300 people “an outrage of unspeakable proportions. Evidence indicates that the plane was shot down by a surface-to-air missile that was launched from an area that is controlled by Russian-backed separatists inside of Ukraine,” he said. “We also know that this is not the first time a plane has been shot down in eastern Ukraine. Over the last several weeks, Russian-backed separatists have shot down a Ukrainian transport plane and a Ukrainian helicopter, and they claimed responsibility for shooting down a Ukrainian fighter jet. Moreover, we know that these separatists have received a steady flow of support from Russia. This includes arms and training. It includes heavy weapons. And it includes anti-aircraft weapons.”

Obama called the downing of MH17 “a global tragedy” and called for “a credible international investigation into what happened.” He said the USA stands ready to provide any assistance that is necessary in the investigation and that (FBI) and the (NTSB) personnel are enroute to the crash site.

After the shoot-down, Ukrainian air service provider Uksatse closed air routes in the Dnipropetrovsk flight information region covering the eastern portion of the country. Eurocontrol said it is rejecting all flight plans that include the routes, adding that the European Aviation Crisis Coordination Cell (EACCC) “is being activated to coordinate the response to the impact of the airspace closure.” (EACCC) was established by the European Commission and Eurocontrol in 2010 to manage crisis responses for the European air traffic management network.

August 2014: Malaysia Airlines (MAS) has reported a second-quarter net loss of -MYR305.7 million/-$95.1 million, widened from a net loss of -MYR175.2 million in the year-ago quarter. The results reflect the aftermath of the March 8 disappearance of Flight MH370 and the shootdown of Flight MH17 on July 17.

For the first half of 2014, (MAS) is reporting a cumulative net loss of -MYR748.1 million, widened from a net loss of -MYR453.8 million in the first half of 2013. (MAS) had posted a net loss of -MRY1.17 billion for the full-year 2013, a nearly threefold plummet from the previous year.

Flight MH370, a Boeing 777-200 carrying 239 passengers and crew, disappeared March 8 during a flight from Kuala Lumpur to Beijing, triggering an international search that is now focused on the southern Indian Ocean off the coast of Perth.

Flight MH17 was destroyed by a sophisticated surface-to-air missile (SAM), while flying at 33,000 ft over Ukraine on July 17. The Boeing 777-200ER was on a scheduled flight from Amsterdam to Kuala Lumpur. All 298 people on board were killed.

“The weak financial performance has made (MAS) acutely aware of the need to restructure (MAS)’s operations, even prior to the double tragedies of MH370 and MH17,” (MAS) said. “The occurrence of the two incidences within a short span of four months, served to worsen the situation further.”

Second-quarter revenue for (MAS) fell -5.1% to MRY3.59 billion, as expenses rose +1.2% to MRY3.62 billion. The subsequent operating loss for the quarter came to -MRY32.9 million, reversing the +MYR227.8 million in operating profit the company reported in (2Q) 2013.

“We expected the impact of MH370 on the performance in (Q2). Our team put in much hard work and effort to regain market confidence and rebuild sales,” (MAS) Group (CEO) Ahmad Jauhari Yahya said. “Tragically, just as we were beginning to see signs of recovery in all regions, we were dealt the blow of MH17.”

(MAS)’ first-half revenue totaled MYR6.87 billion, down -1.8% year-over-year. Expenses grew +3.7% year-over-year to MYR7.32 billion, leading to an operating loss for the first-half of -MYR134.1 million, down -MYR392 million from the first-half of 2013.

During the second-quarter, (MAS)’ traffic growth was flat, falling -0.3% year-over-year to 11.55 billion (RPK)s as (MAS) boosted capacity +8.8% to 15.66 billion (ASK)s. Load factor for the quarter reached 73.7% LF, a -6.7 point drop from the year-ago quarter. Passenger yield fell -4% year-over-year to MRY21.7 sen per (RPK). (MAS) carried 4.2 million passengers during the second-quarter, up +0.2% from the 2013 June quarter.

(MAS)’ half-year traffic statistics showed +16.3% year-over-year growth for the January - June period, as (RPK)s reached 23.66 billion. Capacity was up +13.6% to 31.52 billion (ASK)s, leading to a passenger load factor for the first-half of 75.1% LF, up +1.8 points year-over-year.

Noting the current business environment of stiff competition and high operational costs, Jauhari acknowledged the need to accelerate (MAS)’ restructuring.

“The impact of the two tragedies [has] damaged our brand,” Jauhari said. “The full financial impact of the double tragedies of MH370 and MH17 is expected to hit (MAS) in the second half of the year. Our company has had to undergo a thorough re-examination and re-evaluation in order to reposition ourselves as a stronger and more sustainable [airline] for the future.”

The majority shareholder of (MAS) (Kazanah Nasional Berhad) announced August 8 its intention take full ownership of (MAS). Khazanah plans to delist (MAS) from Bursa Malaysia; if the motion is approved, a plan to restructure the (MAS) group and return it to profitability, will be put into place.

Malaysian sovereign wealth fund, Khazanah Nasional Berhad, which owns 69.4% of (MAS), has tabled a plan to buy out (MAS)’s remaining shareholders at 27 sen/$0.08 per share to take total ownership.

In a formal statement to (MAS)’ board, Khazanah made the offer as part of a “selective capital reduction and repayment exercise,” which would see the wealth fund as the sole owner.

If the board and the remaining 30.6% of shareholders agree, Khazanah would pay some $435 million to take control of (MAS). If the buyout goes ahead, Khazanah has said it is committed to “a complete overhaul of the national carrier on all relevant aspects.”

It is expected this would include a complete restructuring of operations, regulatory environment, funding and (critically) of work practices within (MAS).

The Khazanah plan is also likely to consider sell-offs of the more profitable aspects of the business, such as it low-cost regional Firefly (FFM) and its (MAS) Aerospace Engineering (MAE) subsidiary.

The timing of the move is significant, as (MAS) is due to release second-quarter figures on August 22. (MAS) shares have been suspended from trading, when they were rated at $0.075 each, pending a response from the (MAS) board and other shareholders.

The future of (MAS), Khazanah said, is critical. “We reiterate that on all relevant aspects, nothing less [than a complete overhaul] will be required in order to revive our national airline to be profitable as a commercial entity and to serve its function as a critical national development entity,” it said.

October 2014: The search for signs of Malaysia Airlines Flight 370 (MH370) is set to accelerate in the coming days, as a third vessel transitions from survey work to searching the vast seafloor area that has been mapped out and surveyed, the Australian Transport Safety Bureau (ATSB) said.

The underwater search (which the (ATSB) said is the latest phase in a search for the missing airplane, a Boeing 777-200 carrying 239 passengers and crew that disappeared on March 8 during a flight from Kuala Lumpur to Beijing) is divided into two stages. The initial stage was bathymetric survey of an area along an arc that the (ATSB) and other investigators determined was the most likely termination zone for MH370. The last ship involved in the surveying, Fugro Equator, finished its work October 26 and is being reconfigured so it can join two other vessels, "Fugro Discovery" and "GO Phoenix," already searching areas surveyed in recent weeks.

“The (ATSB) has utilized the data from the bathymetric survey work to prepare the initial plan for the underwater search, to be followed and referred to by all parties involved,” the (ATSB) said. “The plan includes search timings, methods, procedures, safety precautions and search areas. The initial search areas have been allocated to the different vessels with the aim of positively identifying and mapping the debris field of MH370.” The search vessels are being funded jointly by Australia and Malaysia, the (ATSB) said.

The survey covered about 58,000 square miles of seafloor (most of it never mapped in detail), the (ATSB) noted. Detailed mapping was required for the second phase of the search, in which sonar is used via surface-mounted equipment and deep tow vehicles. The mapped area is along the centerline of an area deemed as the most likely to be where MH370’s flight concluded, based on satellite tracking details and other data analyzed by the (ATSB) and other experts.

"While it is impossible to determine with certainty where the airplane may have entered the water, the available data and analysis indicate that the most likely location lies close to a long but narrow arc in the southern Indian Ocean (where the airplane last communicated with a ground station through a satellite),” the (ATSB) noted. “This is where the airplane is assessed to have run out of fuel.”

The (ATSB) noted that investigators continue to analyze the limited data they have on MH370’s flight, and further revisions are possible.
“This ongoing effort may result in changes to the prioritization and location of search activity within the current search area along the seventh arc,” the (ATSB) said.

The agency noted that it receives regular reports of debris washing up on Australia’s west coast, to the search area’s east, which members of the public believe may be from MH370. The (ATSB) said that while it “reviews all of this correspondence carefully,” its analysis determined that any floating debris was “far more likely” to travel west away from Australia.

“It is possible that some materials may have drifted to the coastline of Indonesia and an alert was issued to Indonesia in August requesting that the authorities be alerted to any possible debris from the airplane,” the (ATSB) said.

November 2014: Australia said it remained committed to searching for missing Malaysia Airlines (MAS) Flight MH370 after comments by one of (MAS)'s Directors suggesting the plane would be declared officially "lost" angered passengers' families. (MAS) Commercial Director, Hugh Dunleavy inflamed already testy relations between (MAS) and the families of those aboard the Boeing 777 by telling a newspaper on November 4 that next of kin would be compensated "once we've had an official loss recorded."

The paper added that Australia and Malaysia were likely to declare the plane lost by the end of 2014, effectively ending a massive undersea search begun soon after the flight disappeared over the Indian Ocean on March 8. On Monday, next-of-kin activist group, Voice 370 said that Dunleavy's "unilateral declaration brings intense agony and confusion to family members and makes us lose faith in the search effort." Malaysia Airlines (MAS) then said the comments were an "expression of a personal opinion only."

December 2014: News Item A-1: Malaysia Airlines (MAS) posted a hefty third-quarter net loss in what could be its last detailed quarterly earnings report for some years, highlighting the challenges facing the government as it prepares to delist (MAS)’ shares.

(MAS) lost -RM576.1 million/-$167.7 million for the three months ended September 30, deepened from a deficit of -RM375.4 million in the same period last year. (MAS) said that while “declining fuel prices have helped stem losses in our quarterly result, (MAS) continues to struggle despite efforts to reduce the financial bleeding.”

For the third quarter, operating revenue dropped -12% to RM3.3 billion despite a +2% capacity increase. Load factor fell by -11.5 points to 73% LF, and passenger yield declined -2%. Operating costs also dropped -7.5%, mainly due to lower fuel prices.

(MAS) was in financial difficulties even before the double tragedies of Flight MH370 and Flight MH17 further dented demand. The Malaysian government has decided to undertake a major restructuring of (MAS), which will require the Khazanah state fund that owns most of the carrier to buy out the remaining stockholders.

MH370, a Boeing 777-200, disappeared in March during a scheduled flight from Kuala Lumpur to Beijing. It veered off its flight path and the search to find the airplane continues in the South Indian Ocean off the Australian west coast. MH17, also a 777, was shot down by a surface-to-air missile, as it flew over Ukraine in July, during a regular Amsterdam - Kuala Lumpur service.

Minority shareholders approved the buyback plan on November 4, but it still needs to be signed off by the High Court of Malaysia. (MAS) expects the delisting to be completed by the end of the year. Khazanah said it intends to eventually relist the company if the restructuring proves successful.

(MAS) says a pick up in international demand after a slowdown earlier in the year reflects the global industry trend of a resumption in air travel growth. However, (MAS) noted that “domestic travel demand has softened.”

Some international markets (particularly China) are still struggling to regain previous demand levels. But (MAS) said it is “encouraged with recovery in other markets as reflected in the higher new booking intakes systemwide compared to the previous year.”

News Item A-2: a) "Malaysia Airlines taps Christoph Mueller for (CEO)" by Air Transport World (ATW) Editor, Karen Walker:

Aer Lingus (ARL) (CEO), Christoph Mueller, known for his airline turnaround skills, has been tapped to become (CEO) of Malaysia Airlines next year.

Malaysian government investment company Khazanah Nasional, which is the majority owner of the Malaysia Airline System, said that Mueller’s contract as (CEO) at (ARL) ends May 1, 2015. “Discussions are ongoing for Christoph Mueller to assume the post at [Malaysia Airlines (MAS)] at a date prior to May 1, 2015, but no earlier than March 1, 2015,” Khazanah said.

Mueller will be nominated to the (MAS) board as a non-Executive Director and appointed (MAS) (CEO)-designate effective January 1.

A German citizen, Christoph Mueller has been (CEO) at (ARL) since 2009, turning around (ARL) from loss-making to profitable. He previously worked at Lufthansa (DLH), Sabena (SAB) and Delta Air Transport, which became Brussels Airlines (DAT)/(EBA).

“Mr Mueller has a strong record of transformation and turnarounds in the aviation industry. Among his key accomplishments, Mr Mueller has demonstrated particular strength in strategic financial and planning, as well as structural repositioning of companies in difficulties. This includes implementing change programs and adopting new technology, distribution, and retail solutions decisively,” Kzhanah said.

(MAS)’ financial difficulties have worsened through 2014 as (MAS) was struck by two major airplane losses (the disappearance of MH370 in March, and the shooting down by a surface-to-air-missile of MH17 in July). Both jet airplanes were Boeing 777s and investigations continue.

The company posted a third-quarter net loss of -RM576.1 million/-$167.7 million in what could be its last detailed quarterly earnings report for some years, highlighting the challenges facing the government as it prepares to delist (MAS)’ shares.

b) "Christoph Mueller, New (CEO) Of Malaysia Airlines, May Be Just The Man Who Can Save The Company" By Ismat Sarah Mangla, International Business Times, i.mangla@ibtimes.com:

It’s being called the toughest job in aviation: turning around the fortunes of beleaguered Malaysia Airlines (MAS), which suffered the loss of two planes and 537 lives this year, not to mention widening financial losses. But now, Malaysia’s flag carrier, which is undergoing privatization, has its man. Christoph Mueller, the 52-year-old German head of Ireland’s Aer Lingus (ARL), was named as (MAS)' next (CEO) and is expected to join the board in January.

According to Khazanah Nasional Bhd, Malaysia’s sovereign wealth fund that currently owns 70% of (MAS), Malaysian Prime Minister Najib Razak called Mueller’s appointment “part of efforts by the government and Khazanah to lay strong foundations for the future success of our national carrier.”

That’s a tall order for anyone, and many analysts are skeptical about whether it can even be done. “Mr Mueller faces an uphill battle in turning around (MAS),” said Henry Harteveldt, a travel industry analyst with Atmosphere Research Group. “But I also believe he is about to experience one of the most exciting parts of his professional career.”

John Strickland, an independent aviation consultant based in London, says that Mueller can handle the turbulence (he has a history of taking on tough challenges). “He has not taken easy positions in his career,” said Strickland. “You want someone calm and battle-hardened for this role, and that’s what he is. He’s got really superb real-world experience facing and overcoming challenges.”

Mueller’s most recent experience at (ARL) seems to bode well for his tenure at (MAS). He joined (ARL) as (CEO) in 2009, when the struggling airline was facing tough competition from low-cost carrier (LCC) rival, Ryanair (RYR). Mueller steered the company through several difficult battles, including fending off a takeover bid from (RYR). He managed to expand (ARL)’s trans-Atlantic services and reposition it as a more service-oriented carrier.

(MAS) also has to stave off competition from low-cost carriers (LCC)s like AirAsia (ASW), at the same time contending with full-service giants in the region, such as Singapore Airlines (SIA) and Cathay Pacific (CAT).

“Under Christoph’s strategic leadership, (ARL) has been transformed into a strong, consistently profitable airline with a clear strategic direction, a resilient business model as a value carrier and an improved cost base," said (ARL) Chairman, Colm Barrington, when Mueller announced in July that he was stepping down from that role.

Khazanah Managing Director, Tan Sri Azman Mokhtar said this kind of experience made Mueller stand out, especially as (MAS) undergoes restructuring as it buys out minority shareholders. The job would require “absolutely the best aviation management expertise, and in particular, . . . a strong track record of turning around national flag carriers,” said Mokhtar.

Not everything in Mueller’s career has gone as smoothly. In the early years, he was at the helm of Sabena (SAB), Belgium’s national airline, which was also suffering huge losses. Mueller, who could not be reached for this story, had to cut jobs, which provoked bitter strikes, and eventually (SAB) went bankrupt in 2001. Similarly, he will have to cut about -6,000 jobs at (MAS), analysts said, a process that's already underway.

“If Mr Mueller succeeds, he will be lauded as a management genius,” said Harteveldt. “If he fails, he will be able to argue that the airline was ‘terminal’ before he got there and that external factors were simply too great.”

Marisa Garcia, Aviation Editor at "Skift," said Mueller's tough experiences with Sabena (SAB) actually make him more suited to the role at (MAS). “He’s had both success and failure, with (SAB), though that failure was due to factors outside his control. That’s actually an advantage. Experience with failure will have helped him build resilience, and given him time to rethink his approach to tough turnarounds,” she said.

Mueller completed an advanced management program at Harvard Business School, and before joining (ARL), he was Executive Aviation Director at TUI Travel (TUG), an international leisure travel group, and Chief Financial Officer of (DHL) Worldwide (DHK), before it was bought by Deutsche Post AG.

He will be the first foreign (CEO) to head up (MAS), which could work in his favor, argues Mike Boyd, an aviation consultant in Colorado. “He’s a foreign guy with a briefcase, coming in with some European magic. It's important to have that,” said Boyd. “He’s coming in as an outsider. It could be a challenge, in terms of culture, but it could also be seen as an opportunity,” added Strickland. “He’s untainted by politics or previous regimes.”

But Garcia said the job will be complicated by his need to assimilate into and communicate effectively within a different culture. “He won’t receive a unanimous warm welcome. We already see a political reaction to the announcement of his appointment, and it will likely intensify,” said Garcia, referring to the reaction of critics within the country, who believe the job should have gone to a Malaysian.

That’s just the beginning of the challenges he’ll face at (MAS). He must also restore trust in a brand that is currently synonymous with tragedy. Flight MH17 was shot down by a missile over Ukraine in July, and flight MH370 disappeared in March with 287 aboard, in a still-unsolved mystery. One crash was not the airline's fault, and the other may have been (if indeed a crash it was) also due to factors beyond its control. But they tainted (MAS)' name heavily.

“That won’t be corrected by a new name or livery. It will be led by fundamentals such as having excellent on-time performance, as well as exploring how it can better improve its pilot (FC) training and ensuring its Aircraft Maintenance is viewed as among the world’s best,” said Harteveldt.

It would be a herculean task for anyone, experts agree.

“The question isn’t really whether Mueller has what it takes to turn around an airline, or even to turn around (MAS),” said Garcia. “The question is whether (MAS) has what it takes to let any (CEO) turn it around.”

News Item A-3: Malaysia’s Khazanah Nasional Bhd sovereign wealth fund and majority shareholder in Malaysia Airline System (MAS) will suspend trading in the national airline’s shares from December 15.

The company posted a third-quarter net loss of -RM576.1 million/-$167.7 million.

Khazanah has proposed a MYR6 billion restructuring plan which aims to bring (MAS) back to profitable operation by 2017. Following the delisting, and a complete buyout of minority shareholders with a MYR1.4 billion injection, (MAS) as an entity will cease to exist and it will be replaced by a new operation called Malaysia Airline Berhad.

In a parallel move, the current (CEO) of Irish national airline Aer Lingus (ARL) Christoph Mueller has been named as the (CEO) of the new entity to replace current (MAS) (CEO) Ahmad Jauhari Yahya.

Mueller will start work on the new airline January 1, 2015, along with new appointees Datuk Seri Mohammed Shazalli Ramli as non-Executive Director and Tan Sri Bashir Ahmad Abdul Majid as Chairman of the new company’s Corporate Reskilling Centre (CRC).

As part of the restructuring, Khazanah has said it will demand a “complete overhaul on all relevant aspects of (MAS)’ operations, business model, finances, human capital and regulatory environment” as it moves towards the full introduction of Malaysia Airline Berhad in July 2015.

Malaysian sovereign wealth fund Khazanah Nasional Berhad has poured cold water on a proposal from Malaysian venture capitalists to buy selected assets of the recently delisted Malaysia Airlines (MAS).

Khazanah, which has pledged to invest up to MYR6billion/$980 million into the company to bring it back to profitability within three years, has said it wants a complete shakeup of work practices, operating processes and asset management for the carrier, but has not so far mentioned an asset sell-off.

However, venture capital company Jentayu Danaraksa Sdn Bhd has proposed buying out (MAS)’s parent company, Penerbangan Malaysia Bhd (PMB). It would then use the firm’s existing airplanes as the basis of a major leasing venture called (JD) Leasing. Other proposals included setting up a low-cost carrier (LCC) and possibly buying out and running both (MAS) domestic short-haul subsidiary Firefly (FFM) and MAS Aerospace Engineering as separate profit centers.

Staffed with some significant aviation heavy hitters such as a previous Managing Director of (MAS), ex-airport managers and ex Big Four consultants, (JD) Leasing is a private company sourcing its backing from “domestic and foreign investors.”

Jentayu Danaraksa Director Feriz Omar said his company would “expand Firefly (FFM)’s operations in the region and elevate the operation level in the engineering arm” in addition to the leasing plan.

However, Jentayu Danaraksa’s offer to be a “strategic partner by issuing new strategic shares in (JD) Leasing at no cost” and to source staff from workers on the old (MAS) payroll did not apparently meet Khazanah’s strategic national requirements. Khazanah canceled a planned meeting with the Jentayu Danaraksa directors, without giving specific reasons.

The Malaysian flag carrier, (MAS) still carries significant importance as a national emblem for many Malaysians. Additionally, union representatives have already pledged to resist both massive job cuts and break up, and sell-off strategies.

News Item A-4: Boeing (TBC) and Malaysia Airlines (MAS) celebrated (MAS)’s 100th 737 direct delivery. The 737-800 arrived in Kuala Lumpur on December 21.

January 2015: News Item A-1: On January 29th, The government of Malaysia, citing Chicago Convention standards, has “officially” declared Malaysia Airlines (MAS) flight MH370 “an accident,” stating that “all 239 of the passengers and crew on board MH370 are presumed to have lost their lives.”

Department of Civil Aviation Malaysia Director General, Azharuddin Abdul Rahman, said “the search for MH370 remains a priority” and Malaysia remains “committed to continue all reasonable efforts to bring closure to this unfortunate tragedy, with the continuing cooperation and assistance of the governments of China and Australia.”

MH370, a Boeing 777-200, disappeared on March 8, 2014 during a flight from Kuala Lumpur to Beijing. No trace of the airplane has been found.

Rahman said the Malaysian government believes that officially declaring the missing airplane an accident “will enable the families to obtain the assistance they need, in particular through the compensation process.” He stated that “the analysis of all available evidence [including radar and satellite data] supports the conclusion that MH370 ended its flight in the southern Indian Ocean.” Rahman added that the Malaysian government has “concluded that the airplane exhausted its fuel over a defined area of the southern Indian Ocean, and that the airplane is located on the sea floor close to that defined area. This is a remote location, far from any possible landing sites. It is also an area with adverse sea conditions with known depths of more than >6,000 meters.”

However, he emphasized, “at this juncture there is no evidence to substantiate any speculations as to the cause of the accident.” Rahman said that the accident declaration is made with “the heaviest heart and deepest sorrow” and “will be very difficult for the families and loved ones of the 227 passengers and 12 crew on board to consider, much less accept. It is nonetheless important that families try to resume normal lives, or as normal a life as may be possible after this sudden loss.”

Referencing compensation to the families of crash victims, Rahman said the Malaysian government “assures that Malaysia Airlines (MAS) will undertake their responsibilities in relation to the legitimate rights and interests of the next-of-kin as provided under the relevant international instruments and relevant domestic laws, with due consideration to international practice. This includes the fulfillment of the compensation process, whether it is pursued through consultation or through litigation.” He added that “Malaysia Airlines (MAS) is ready to proceed immediately with the compensation process, with due regard for the readiness of the next-of-kin to take this step.”

News Item A-2: Aer Lingus (ARL) (CEO), Christoph Mueller will step down February 28 to take up his new role as (CEO) of Malaysia Airlines (MAS), accelerating the end of his original contract.

Last month, Malaysian government investment company Khazanah Nasional, which is the majority owner of the Malaysia Airline System (MAS), named Mueller as (MAS)'s next (CEO). At the time, Khazanah Nasional said Mueller would take up his new role between March 1 and May 1.

Mueller has led (ARL)Aer Lingus since 2009 and his contract committed him until May 1, 2015. However,(ARL) has now confirmed February 28 as Mueller’s departure date. “Mr Mueller will continue as (CEO) working with the board and executive management team in the period to February 28, 2015 to ensure a seamless and successful transition,” (ARL) said in a stock market disclosure.

Effective immediately, (ARL) Chairman, Colm Barrington has taken responsibility for “strategic matters” and will lead (ARL) on an interim basis if Mueller’s successor is not in place by March 1.

Barrington is taking strategic control of (ARL) at an interesting time. Last month, British Airways (BAB), Iberia (IBE) and Vueling (VUZ) parent, the International Airlines Group (IAG) made a tentative takeover approach for (ARL), but (ARL)’s board rejected the offer, claiming it undervalued the airline.

Since then, there has been increased trading in both group’s shares. (ARL)’s share price has increased +17.3% to €2.26, while the (IAG)’s has risen +7.7% to £4.79. The (IAG), which would benefit from (ARL)’s London Heathrow (LHR) slots, is widely expected to make another approach.

Aer Lingus (ARL) maintained its guidance for a higher full-year operating profit before exceptional items than the €61.1 million it posted in 2013. Taking advantage of favorable fuel prices, (ARL) has also increased its hedging from 50% to 90% of its 2015 requirements, averaging out at $830 per metric tonne. It is also 24% hedged for 2016. “The lower average fuel cost, in addition to the positive effects of staff cost stabilization achieved through the (IASS) pension solution and further efficiency measures, will contribute positively to the group’s 2015 results,” it said in a stock market disclosure, but it cautioned that these gains could be partially offset by negative USA dollar to euro exchange rate changes.

February 2015: News Item A-1: Malaysia Airlines (MAS) is finalising plans to issue termination letters to staff identified for 6,000 job cuts under (MAS)'s restructuring exercise, "The Edge" reported.

Each existing staff member will receive at least one letter, and those re-instated into the new company (Malaysia Airlines Bhd (MAS)) will receive two letters, said "The Edge."

News Item A-2: Turkish Airlines (THY) is considering leasing two Airbus A380 superjumbos from Malaysian Airline System (MAS), giving (THY) a test run at flying the world's largest airliner, according to people familiar with the plan.

Senior management will ask for approval from the board in coming days to enter formal talks with (MAS). (MAS), which operates six A380s, no longer needs the capacity. Offloading parts of its A380 fleet would help (MAS) in its efforts to rescale its business after two 777 disasters last year. (THY) is among the fastest growing carriers in the world and so far doesn't operate the A380, which could support (THY)'s push to establish its Istanbul base as a transfer hub for travel between Europe and the USA as well as Asia, mirroring the strategies of top Persian Gulf carriers located further southeast.

"Following (MAS)' restructuring announcement, (MAS) is exploring new ways to reposition itself as a stronger and more sustainable airline for the future, however, (MAS) is unable to confirm on the matter as the business plan has yet to be finalized."

(THY) rose as much as +1.2% and was trading up +0.9% at 9.35 liras as of 11 am in Istanbul. Airbus (EDS) was +0.1% higher at EUR50.72 in Paris. (MAS) is controlled by sovereign-wealth fund, Khazanah Nasional Bhd.

(THY) is expanding its fleet at a rate of almost three planes a month after ordering 117 airplanes from Airbus (EDS) and 95 from Boeing Company (tbc). Focusing on higher frequencies has meant that until now (THY) wasn't ready to take on high-capacity planes, though a chance to lease a small number of A380s, without the commitment to purchasing, would allow (THY) to test whether it has sufficient demand.

(MAS) is looking to lease out the superjumbos because traffic has waned following two disasters last year. In early 2014, an (MAS) 777 disappeared, and no trace of the plane has been found to date, with all occupants officially declared dead. In July, another 777 crashed in Ukraine following a suspected missile attack, also killing everyone on board.

For (EDS), which has struggled to find new customers for the A380, even a small lease agreement involving the large plane would offer a respite, as it would give a fast-growing airline the chance to assess the model with a view toward possibly buying or leasing more in the future.

(EDS) has failed to find a new airline buyer for the A380 since 2013. Its only purchaser in 2014 was a leasing company, Amedeo, that has yet to line up a single carrier to take any of the 20 it ordered.

Leasing a plane from another company typically comes in two forms. A dry lease would hand over the (MAS) A380s to (THY), but require the new operator's pilots (FC) and flight attendants (CA) to get trained to work on the plane. A so-called wet lease would include trained pilots (FC) and flight attendants (CA).

March 2015: News Item A-1: "Search for Malaysia Airlines (MAS) 777 Flight MH370 Could End Soon" by Air Transport World (ATW) Jeremy Torr, March 2nd, 2015.

Australian Deputy Prime Minister, Warren Truss has said the country’s search for missing Malaysia Airlines (MAS) flight MH370 “cannot go on forever.” Truss added that talks on a cessation of the search are currently underway.

The (MAS) Boeing 777 disappeared on March 8 last year, while on a flight from Kuala Lumpur to Beijing. It was tracked deviating from its course to fly back toward Malaysia, and was believed to have flown on for several hours off course, over the Indian Ocean.

Despite a multi-million dollar search involving multinational military and navy staff, and equipment across several regional oceans, no trace has been found of the airplane or the 239 passengers and crew. Late last month, the Malaysian Department of Civil Aviation Malaysia Director General, Azharuddin Abdul Rahman officially reported the disappearance as “an accident,” citing Chicago Convention standards.

The latest phase of the search covering some half-million square miles off the west coast of Australia, is estimated to have cost Malaysia and Australia (the two key nations involved in the search) around $40.5 million to date.

The current phase of the search, operated by a fleet of commercial Dutch survey vessels, is due to end in May. “We want to do everything that’s reasonably possible to locate the airplane, but clearly we cannot keep searching forever,” Truss said.

Truss said the decision to stop searching will have to made before May, if no sign of the airplane or wreckage is found. He said the possibility of the search being called off had already been discussed between the authorities of nations representing the majority of passengers and crew (Malaysian, Chinese and Australian).

In a related matter, Australian air navigation services provider (ANSP) Airservices Australia will put on trial, a new tracking system with satellite operator Inmarsat that could offer improved commercial flight tracking.

The trial, which will potentially apply to all commercial airline flights to and from Australia, will use Automatic Dependent Surveillance-Contract (ADS-C) systems to track non-military airplanes over Australia’s ocean territories.

The move follows an (ICAO) resolution to work on the adoption of a 15-minute interval tracking standard for all commercial operators, primarily as a result of the MH370 disappearance. Initial trials will be run in association with Qantas (QAN) and Virgin Australia (VOZ). "This is an important step in improving international airline safety,” Inmarsat (CEO), Rupert Pearce said.

News Item A-2: "MH370 One Year On: Never Give Up on Finding the Answers" by Karen Walker in (ATW) Editor's Blog, March 7th, 2015.

We are now one year on from when Malaysia Airlines (MAS) MH370 disappeared from radar early in its scheduled flight from Kuala Lumpur to Beijing, and then inexplicably vanished.

Had you asked me last spring, even as it became apparent that the Boeing 777-200 veered way off its flightpath and likely crashed into the deep and inhospitable waters of the South Indian Ocean, I would not have thought we would still be looking for debris (any debris) of the 777 a year later.

But that is where we are, making the loss of MH370 and the 239 people on board the most tragic unsolved commercial aviation incident of all.

I still believe we will ultimately find some part of MH370 and that we will ultimately have some better answers than we have today as to what happened and why.

This week, as we enter the second year of searching for those answers, we should focus on why that is so important. First, it’s because the families and close friends of those on board are owed an explanation. This is primarily a human tragedy. The cause, although not known, is likely to have been human. The pain to those who lost loved ones and have no explanation and no closure is unimaginable and unquestionably human.

Second, the global air transport industry is only as superlatively safe as it is, because it never gives up on learning from its accidents and mistakes. Every incident, however tragic, brings the industry together and takes it another step higher in its safety standards. Aircraft and engine design flaws; crashes into unseen other airplanes or mountains; airplanes brought down by icing or wind shear. These were once common perils in commercial aviation and each has been addressed by better understanding of the issue, awareness of the dangers, and application of technology and training.

To apply that same process to MH370, industry still needs the first part (a better understanding of what happened). That is why the search for whatever remains of the airplanes is a critical endeavor that must continue.

An important step has been taken, of course, via the (IATA)-led initiative to improve continuous tracking of commercial airliners throughout their flight paths. Some have criticized this effort as not addressing the cause of the crash. But that misses two important truths. We don’t yet know what caused the crash. And while continuous tracking technology might not have prevented MH370’s crash, it could well have led to alerts about its flightpath divergence much earlier and helped pinpoint the airplane’s whereabouts. Both pieces of knowledge would have been invaluable to search & rescue teams, investigators and, most important of all, to the families and friends left in a vacuum of despair and false hope.

So let’s take this week to recognize and encourage those who are still committed to the mission of tracing MH370 and solving this mystery. And, of course, to hold in our thoughts those who lost so much that day on MH370 and who yearn for answers.

News Item A-3: A report into the disappearance of Malaysia Airlines (MAS) flight MH370 has revealed the locator-beacon battery in the flight data recorder (FDR) had passed its expiration date, an oversight that later triggered a fleet-wide check by (MAS).

MH370, a Boeing 777, disappeared March 8 last year while on a flight from Kuala Lumpur to Beijing. It was tracked deviating from its course to fly back toward Malaysia, and was believed to have flown off course for several hours over the southern Indian Ocean. It was carrying 239 people onboard, including crew.

The battery issue appeared to be the most significant piece of new information in the report issued by the MH370 investigation team a year after the incident as required by (ICAO). While the report details the airplane’s history, the pilots (FC)’s background and the immediate response by various government agencies, it does not shed light on what may have caused the airplane to crash.

The expiration date on the (FDR) locator-beacon battery was December 2012, according to airline maintenance records cited in the report. The battery was apparently last replaced in 2008, but (MAS)’s Engineering Maintenance system was not updated correctly to reflect the installation. Therefore, the system did not trigger an automatic notification of the battery’s impending expiration.

Malaysia Airlines (MAS) did not realize the oversight occurred until after the disappearance of MH370, when data relating to the airplane’s locator beacons were requested. Subsequently, (MAS) “carried out a fleet-wide record inspection for the [locator beacons] to ensure all records for other airplanes are updated accordingly.”

Beyond the battery’s expiration date, there is some margin of power, but beyond that point, the locator beacon’s efficacy decreases, the report said. Even if the locator beacon worked, it may not have lasted the required 30 days, and the signal frequency and power may not have remained within specification.

A review of entries in the airplane’s technical log “did not reveal any significant defects or trend” since its last "D" check in June 2010, the report said. There were seven items on the deferred defect log, but these were relatively minor in nature and did not raise any red flags with investigators.

No unusual engine behavior had been noted by engine-health monitoring during the three months before the incident. There were no automated maintenance warnings sent by the engine health-monitoring system or the central maintenance computing system during the airplane’s last flight.

News Item A-4: "Rockwell Collins Offers Global Airliner Tracking System, by Karen Walker, March 9, 2015.

Rockwell Collins is putting an airliner flight tracking service on the market via (ARINC), the communications and integration specialist it acquired in 2013.

(ARINC) MultiLink will be available this spring and merges six different data sources to provide a flight tracking solution for airlines, the company said. SEE ATTACHED - - "MAS-2015-03 - ARINC MULTILINK MAP."

Continuous global tracking of airliners has become an industry focus after the disappearance of (MAS) MH370, a Boeing 777-200, a year ago. The 777, with 239 people onboard, veered significantly off its scheduled flight path from Kuala Lumpur to Beijing. Although the airplane is believed to be at the bottom of the southern Indian Ocean, extensive and ongoing search efforts have so far failed to find any trace of wreckage.

An (IATA)-led Aircraft Tracking Task Force was set up last year to look at ways in which airliners could be tracked continuously in-flight. The task force issued a set of recommendations at the end of 2014, many of which rely on leveraging or adapting existing technologies and capabilities.

(ARINC) MultiLink brings together multiple data sources to reliably report the location of an airplane anywhere in the world. These sources include (ADS-C); high-frequency data link (HFDL) performance data; (ADS-B); USA Aircraft Situation Display to Industry (ASDI) radar data; EUROCONTROL position information; and Aircraft Communications Addressing and Reporting System (ACARS) position reports. The system has been developed with the ability to incorporate future third-party data sources which may include position data.

Rockwell Collins said it uses a proprietary algorithm to merge the data sources to provide more accurate and higher fidelity position reporting. In addition, the use of multiple sources means an airplane’s position can be reported more frequently. The service can also notify airlines when an airplane unexpectedly has stopped reporting positional data, or when the airplane has deviated from its expected path, the company said.

“In today’s global aviation environment, no single source of data is sufficient to track airplanes globally,” Rockwell Collins Senior VP Information Management Systems, Jeff Standerski said “By merging multiple data sources, many of which airlines already receive, we can automatically select the right combination of data feeds to allow airlines to pinpoint an airplane’s location anywhere in the world, in the most economical way.”

A key and differentiating element of (ARINC) MultiLink is its ability to incorporate (HFDL) network performance data via Rockwell Collins’ global air/ground data link network. Airplanes equipped with (HFDL) automatically deliver network performance data directly to Rockwell Collins. This data can be used in conjunction with other data sources to provide highly accurate and cost-effective airplane tracking everywhere around the globe.

“Using the unique propagation characteristics of (HFDL) enables (ARINC) MultiLink to communicate with properly equipped airplane operating in remote regions and over the oceans,” Rockwell Collins Director, GLOBALink Programs, Tim Ryan said.

During a Webinar press conference, Rockwell Collins executives gave additional information about the system, saying they were talking to about six airlines directly and that it would typically be operational within a month or two, depending on an airline’s current data capabilities.

Ryan and Rockwell Collins VP Aviation & Network Services, Dave Poltorak said the system was highly scalable and affordable, using technologies that all exist today.

A key differentiator, they said, was the incorporation of (HFDL), performance data unique to Rockwell Collins and which 130 airlines use today.

The system has not yet been demonstrated to the (ATTF). “We wanted to give [(IATA) and (ICAO) task force members] a lot of room to do their job and they are doing it very well,” Poltorak said. “”We didn’t want to interfere. But with the launch of the [MULTILink] service today, we will be able to share test data with them going forward.”

April 2015: News Item A-1: Malaysia Airlines (MAS) will withdraw four destinations from its route network in the coming weeks. (MAS)
will end the Kuala Lumpur - Kunming service on April 30th, followed by Kuala Lumpur - Krabi on May 6th, Kuala Lumpur - Frankfurt on May 29, and Kuala Lumpur - Kochi on June 1st.

Despite withdrawing from these four destinations, (MAS) will maintain connectivity through partners in the Oneworld (ONW) alliance, of which it is a member.

“Our challenge is to ensure (MAS) operates and utilizes its fleet at an optimum level, as well as to be able to maximize revenue on every route it flies,” added former group (CEO), Ahmad Jauhari Yahya. “Unfortunately, (MAS) today continues to operate several unprofitable and low yield routes, with little passenger flow-through to other routes in the network. Operation of these very poor performing routes only adds to our worsening financial loss position as a network carrier.”

FlightMaps Analytics shows that (MAS) competes with AirAsia (ASW) on routes from Kuala Lumpur to Kochi, Kunming, and Krabi. On the Kuala Lumpur - Frankfurt route, it competes with Lufthansa (DLH).

News Item A-2: Malaysia Airlines (MAS) is preparing to migrate its operations, assets, liabilities and “selected employees” to Malaysia Airlines Berhad (NewCo) on July 1, overseen by new (CEO) & Managing Director, Christoph Mueller.

Mueller’s original contact committed him to remain with Aer Lingus (ARL) until May 1, but (MAS) wanted him to take up his role sooner. In January, (ARL) agreed to accelerate his departure to February 28 and (MAS) has now confirmed his start date as May 1.

Current (MAS) Managing Director & Group (CEO), Ahmad Jauhari Yahya, who led the carrier since September 19, 2011, steps down April 30, although he will stay on as a non-executive director between May 1 and December 31.

The new timelines (agreed during a March 18 board meeting) mean Mueller will be in place for a critical phase of (MAS)’s restructuring, which will see NewCo effectively replace (MAS). “The process of identifying the pool of staff that meets NewCo’s requirements is underway, following the completion of a comprehensive talent assessment exercise in February 2015,” (MAS) said.

Job offers will be sent out to the successful NewCo candidates on June 1. “On the same date, (MAS) will issue employment termination letters with a three-month notice to all its employees,” it said. Mueller will transition to become NewCo Managing Director & Group (CEO) on September 1, when the new contracts for the wider staff base will also take effect.

Mueller aims to restore (MAS)’ profitability through the turnaround plan, which he described as “very ambitious”. (MAS) Chairman, Tan Sri Md Nor Yusof said the restructuring is required to “rebuild and restore” (MAS), which suffered two tragic airplane losses in 2014.

“The accelerated leadership transition will enable Mueller to be in a position to lead the overall (MAS) restructuring effort as it enters one of its most critical phases. It will also provide him with the executive capacity and an appropriate timeframe to prepare NewCo to begin operations. This will have a positive impact on the long-term (MAS) restructuring effort and provide the best possible chance for a successful turnaround,” (Mas) said.

Mueller has led Aer Lingus (ARL) since 2009. He will be replaced by Chief Strategy & Planning Officer, Stephen Kavanagh, who took up his new role as (ARL) (CEO) on March 1. Kavanagh is taking control of (ARL) just as the International Airlines Group (IAG) seeks to acquire the Irish carrier.

News Item A-3: Malaysia Airlines (MAS) will be the first airline to go live with global flight tracking technology using (SITA) OnAir’s (AIRCOM) FlightTracker this summer.

(MAS) has already conducted extensive testing of the technology, which is essentially a ground-based software upgrade to existing equipment that allows airlines to track airplane positions and identify any unexpected deviations or gaps in position reports.

Because it uses existing equipment and re-purposes air traffic control (ATC) data (it works using the (AIRCOM) Server (ACARS) message handling system), it does not require airlines to invest in new equipment.

(AIRCOM) FlightTracker uses multiple sources of data to guarantee tracking intervals of at least every 15 minutes for every flight, although airlines can optionally configure it for intervals of less than <15 minutes. In addition, it enables an airline to proactively obtain Automatic Dependent Surveillance-Contract (ADS-C) tracking data immediately, if it detects a gap in data from other sources. It can also obtain one-off position reports from the Flight Management computers on short-haul airplanes that do not have (FANS) data link avionics.

(SITA) OnAir (CEO), Ian Dawkins said: “We have designed the solution so airlines have straightforward access to (ATC)-like tracking data. For those airlines already using our (ACARS) messaging, we can deploy it very quickly. Following the recent (ICAO) discussions, we are also working on the definition and development of a new system to detect and report unusual situations. We are also investigating new airplane solutions that are independent of airplane power or systems.”

(SITA) said (AIRCOM) FlightTracker had an “important role to play in providing improved tracking and detection of unplanned movements, without requiring modifications to the airplane. It is simply an extra software layer on top of (SITA) OnAir’s existing (AIRCOM) Server (ACARS) message handling system, which is already used by over 90 airlines around the world.”

Dawkins said that, in the event of an emergency, (AIRCOM) FlightTracker position reporting would be provided free of charge to (SITA) member customers.

“(AIRCOM) FlightTracker will request emergency positioning reports if it identifies that a flight has left its normal route for an unknown reason, and we will waive charges for that reporting until the emergency ends,” he said.

Malaysia Airlines (MAS) flight MH370 777-200, disappeared on March 8, 2014 during a flight from Kuala Lumpur to Beijing with 227 passengers and 12 crew on board. No trace of the airplane has been found after an extensive search in the southern Indian Ocean where the airplane is believed to have gone down after changing course. In December 2014, an Aircraft Tracking Task Force (ATTF) was set up and has issued a report with recommendations to improve continuous tracking of airliners.

On January 29, the government of Malaysia, citing Chicago Convention standards, “officially” declared MH370 “an accident,” stating that “all 239 of the passengers and crew on board MH370 are presumed to have lost their lives.”

News Item A-4: Media reports: German government Warned of Dangers before MH17 Shootdown" by Karen Walker, (ATW) Editor April 28th, 2015.

The German government had intelligence indicating the danger of surface-to-air missiles in the Ukraine region where Malaysia Airlines (MAS) Flight MH17 was shot down last year, according to German media reports.

Flight MH17, a Boeing 777, crashed July 17, 2014 during a scheduled flight from Amsterdam to Kuala Lumpur. All 298 people on board were killed. Damage found on the airplane wreckage indicated there were impacts from a large number of high-energy objects from outside the airplane, according to a Dutch Safety Board accident report.

The Dutch report also said that three other airliners were in the area when MH17 crashed; one of them, a Boeing 777, was following MH17 on the same track and altitude.

Several German TV channels today released an investigative media reports claiming that German intelligence officials were concerned about the shooting down of an Antonov military jet just three days before the MH17 crash and made those concerns known to the German government. The intel officials believed the Antonov incident had potential safety implications for airliners that regularly flew routes through that same area, over a war-torn region. German media said the officials warned the German government of the potential hazard to airliners.

The need for greater collaboration and information-sharing, over where it is safe to fly has been a key focus area of the (ICAO) task force that was created in the wake of the MH17 shoot-down. The task force wants to find better ways for government and intelligence organizations to share critical information that could help prevent another similar event and has drafted 12 proposals, including one calling for a global (NOTAM) system.

But getting governments and defense agencies round the world to provide that information is a difficult task. USA Director National Intelligence, General James Clapper said last year at the (AVSEC) conference in Washington DC that he strongly supported the concept of multiple intelligence agencies working jointly together as well as vertically with organizations such as the (FAA), Transportation Security Administration (TSA), and the aviation industry. He has created a dedicated staffer reporting directly to him who is responsible for aviation security liaison. But he also warned that protecting intelligence agents and their technologies was essential.

New, sophisticated intelligence tools and greater cooperation across intelligence agencies is helping to get information on threats sooner. Clapper pointed out that it was these sorts of tools that enabled USA intelligence to know within hours what had happened to MH17.

However, Clapper added, “We also have to protect our people and the sources of our trade craft in order to keep using them. Our adversaries go to school on the lessons of our transparency.”

So, he explained, while he understood the call by the aviation industry for faster, even instantaneous information in the light of MH17, intelligence integration would be “a perpetual journey rather than a destination.”

News Item A-5: Malaysia Airlines (MAS) has offered for sale its six Airbus A380s and four Boeing 777-200ER jets, according to the aviation industry site "Leeham News."

It reported that (MAS) is allegedly open to outright sale or lease of the airplanes. In May 2012, (MAS) took delivery of its first A380, and currently it flies these jets to Paris, London, and Hong Kong.

In late 2014, (MAS) was nationalized by Malaysia’s state-run investment holding arm Khazanah Nasional, in a move that came after years of ever-increasing debt.

(MAS)’ debts have approached 1.5 billion dollars since 2011, with analysts predicting that Malaysia Airlines (MAS) would not break even until at least 2016.

Last year saw (MAS) lose two of its Boeing 777s. The MH370 flight disappeared and is yet to be discovered, while the MH17 flight was shot down over Ukraine.

Khazanah Nasional planned to pump hefty sums into (MAS) before the end of 2016 so as to try to make (MAS) profitable again by 2017.

May 2015: News Item A-1: "Troubled Malaysia Airlines (MAS) to be Completely Revamped" by Marcel van Leeuwn, aviationnews.eu.

Loss-making Malaysia Airlines (MAS) is set to undergo a complete overhaul as it is restructured into a new company, with a re-branding that will be unveiled imminently and changes planned for its fleet and network strategies.

Christopher Mueller (CEO), said the new company will be like a new "start-up." A new name and livery are on the cards. He said "I'm hired to run this new company entirely on commercial terms and there's very little margin for error" at the downtown Kuala Lumpur downtown office of Malaysian state investor Khazanah, which took (MAS) private last year as part of a 6 billion ringgit/$1.66 billion restructuring.

"It's not a continuation of the old company in a new disguise, everything is new," said Mueller, who helped turn around carriers such as Aer Lingus (ARL), Belgium's Sabena (SAB), and Germany's Lufthansa (DLH).

Khazanah said that the Chairman of audit firm, PricewaterhouseCoopers Malaysia has been appointed to oversee the move of (MAS)' assets and liabilities to a new company, Malaysia Airlines Bhd, which is due to start operating by September.

Apart from the brand, analysts say that the key to a revival will be management;s ability to reduce costs, deploy capacity more efficiently, create a profitable network that leverages on Kual Lumpur's position as a regional hub, and partnerships with other airlines. Source: Reuters/Yahoo.

News Item A-2: "Malaysia Airline Systems Outlines New Business Strategy", by (ATW) Jeremy Torr, May 28, 2015.

The new Malaysian flag carrier set to be raised from the assets of Malaysia Airlines (MAS) has outlined a major change of strategy, and hinted at swinging management cuts in addition to the -8,000 staff job cuts announced earlier.

Newly appointed (CEO) Christoph Mueller said that in addition to staff cuts and route changes, management would see a shakeup. “Let me tell you there are lots of vacancies in the management ranks, so we will start the new company with a lot of open positions,” he said, but added that although some sectors have “enough existing talent,” (MAS) would begin recruiting a new management team.”

Malaysian Transport Minister, Datuk Seri Liow Tiong Lai also confirmed the new airline aims to cut its long-haul fleet and routes, and instead will concentrate on regional transit hub business. “[The airline] will be anchor for transit passengers, flying them into the regional market,” Liow said. He said the plan is to use (MAS) as a transit carrier to fly regional links to Australia, China, India, and Southeast Asian countries like Indonesia and Thailand.

“If [the airline] decides to cut routes in Europe, for instance, we will offer them to AirAsia X (ASX) or Malindo (MXD),” Liow added.

As part of the new approach, management is looking to increase flights on a regional basis. Malaysia is already negotiating with the Japanese aviation authorities to give access to Tokyo Haneda International in addition to existing Narita and Osaka flights.

However, the changes would not affect passengers with existing bookings, Mueller said, adding that operations would continue as normal and all reservations and bookings would be unaffected. “The [new strategy] does not affect our daily operations or existing reservations,’’ he said. “[Passengers] can continue to make reservations, in full confidence that our flights and schedules will operate as normal, tickets sold will be honored, and our "Enrich" frequent flyer program continues with miles and status preserved.”

News Item A-3: Malaysia Airlines (MAS) has received a Boeing 737-800 from airplane lessor, Avolon (AZV). It is the first of three airplanes sale and leaseback transactions between the two companies.

News Item A-4: See video "Visit Kuala Lumpur - (very quickly)" - -
https://vimeo.com/50922066

June 2015: News Item A-1: Three more airlines (Singapore Airlines (SIA), Royal Brunei (RBA), and Norwegian Air Shuttle (NWG)) have signed up for (SITA) OnAir’s flight tracking system, and AIRCOM FlightTracker. These carriers will join Malaysia Airlines (MAS), Oman Air (OMR) and 10 other unspecified carriers that use the system.

(AIRCOM) has been developed by (SITA), working with a number of airlines to use equipment already fitted to the airplane to provide a tracking solution. No additional hardware is required, just an additional layer of software that can be installed and activated in a matter of days.

The system “meets and exceeds the flight tracking requirements defined by (IATA) and (ICAO),” (SITA) OnAir (CEO), Ian Dawkins said at the (SITA) Air Transport Information Technology (IT) Summit in Brussels.

(AIRCOM) FlightTracker harnesses the communications links already installed on most modern airliners to download position data to an airline's operational center, using Automatic Dependent Surveillance-Broadcast (ADS-B) and (ATC) radar data as a tracking tool, while the aircraft is over land and switching to (ACARS) and (FANS) in the oceanic environment.

Dawkins pointed out that 14,000 airplanes in the global fleet are already equipped with some element of (SITA) OnAir, operated by 400 customer airlines. More than >95 of these are equipped with the (AIRCOM) server, meaning that the software upgrade can be deployed in days. (SITA) has also created a cloud solution for airlines that do not have (AIRCOM).

Norwegian (NWG) (COO), Geir Steiro said: “Norwegian Air Shuttle (NWG) has a strict selection process for every new solution we introduce. (SITA) OnAir’s Flight Tracker is the most complete solution available. Using multiple sources of data, we can track all our aircraft at 15 minute intervals or less. It also provides the most accurate data, using “smoothing' to combine position sources. A bonus feature is the unique way it integrates (ATC) data into our systems. It will give us valuable insight into operations and how we can improve them.”

A total of 15 airlines are currently using (AIRCOM) FlightTracker and seven have also signed up for an option that issues an alert if an aircraft deviates from track. A refined version of the deviation alert system will be integrated into the next version of the system due for release later this year. This will define an operating corridor for the aircraft, incorporating (ATC) data link communications, to ensure that legitimate and approved deviations do not automatically trigger an alert.

(AIRCOM) FlightTracker forces the aircraft to communicate its position at a regular interval,” Dawkins said. “It guarantees regular flight position updates.”

(SITA) is also conducting trials with a major European airline testing the feasibility of streaming black box data from aircraft in the event of an emergency. Dawkins said that if the trials are successful, this capability could be incorporated into (AIRCOM) FlightTracker as early as the end of this year.

“Having immediate access to flight data can help to improve flight safety,” he said.

(SITA) OnAir said it would provide flight tracking and position reporting services free of charge to (SITA) members in the event of an emergency.

News Item A-2: Malaysia Airlines (MAS) is to sell its 9% shareholding in Abacus International by the end of the year as part of the streamlining of its businesses and divesting itself of non-core assets.

July 2015: News Item A-1: "MAS-2015-07 - MH370 777 Debris Found?"
Seattle Times News Service, July 30, 2015.

See attached - - "MAS-2015-07-MH370 777 Debris-A/B/C.jpg" shows part of a 777 wing that was washed ashore on the Eastern coast of Reunion Island. Boeing experts who examined the photos identified it as being from a 777. (MAS) Flight MH370 vanished March 8, 2014, while traveling from Kuala Lumpur to Beijing with 239 people aboard.

Later on August 5th, Malysia's Prime Minister confirmed that the piece of aircraft wing discovered on Reunion Island last week is from flight MH370, the Malaysia Airlines (MAS) Boeing 777-200 that disappeared last year.

Prime Minister Najib Razak said August 5 that aircraft experts in Toulouse, France (where the part was taken for investigation) “have conclusively confirmed that the aircraft debris found on Reunion Island is indeed from MH370.”

It is the first piece of the aircraft to be seen or recovered from the 777, which veered far from its planned course about 40 minutes after taking off from Kuala Lumpur in March 2014. The scheduled flight was bound for Beijing and there were 239 people on board.

Satellite imagery later indicated that the aircraft headed west, then south over the Indian Ocean, where it is believed to have crashed. But there were no emergency calls and, until today, no physical sign of the aircraft despite a huge, multinational search effort led by Australia.

There is still a long way to establishing what happened to MH370, but the news that the wing flap discovered on Reunion is indeed from that airliner is huge. First, it confirms the long-held belief that the aircraft did crash somewhere in the south Indian Ocean.

Second, that affirmation alone will help provide family and friends of the victims some measure of closure.

Third, the discovery and direct link to MH370 will give renewed vigor to a very long search effort which, while extremely important, would be difficult to sustain indefinitely without any evidence of the aircraft and given how expensive and technologically challenging is the task.

Finding definitive answers to what happened to MH370 remains an enormous, daunting and expensive challenge. But this latest news, almost 17 months to the day that this 777 inexplicably vanished, is a sad but bright spot in a dark chapter of commercial aviation history.

News Item A-2: "Malaysia Airlines to Cut Flights to India as Part of Restructure" by Travel Biz Monitor, July 16, 2015.

According to a report by Aneesh Phadnis for the "Business Standard," Malaysia Airlines (MAS), which suffered twin air disasters last year, is reducing capacity on its Indian routes as a part of its overall restructuring exercise. (MAS) is withdrawing one of its two Kuala-Lumpur - Delhi flights and will operate the smaller Boeing 737 airplanes on its two Mumbai flights. The changes in schedule will come into effect on September 1, 2015.

At present, (MAS) flies a mix of Boeing 777 and Boeing 737 on the Kuala Lumpur - Mumbai route 12x-weekly, but now will serve the route with two Boeing 737 flights.

(MAS) will have double-daily flights to Mumbai (instead of 12 per week), but with reduced number of seats on offer. Also, it will only have night departures from Mumbai and Delhi, which have better onward connecting flights to Australia and cities in South East Asia.

(MAS) also flies to Bengaluru, Chennai, and Hyderabad, and it stopped its flights to Kochi a few months ago.

Along with Indian routes, (MAS) is making service reductions on various other foreign routes and is suspending service to Brisbane, Istanbul, and Male.

The Malaysian sovereign wealth fund, Khazanah took over the airline last August and unveiled a 12-point recovery plan. As part of its restructuring, it will transfer the assets and liabilities of (MAS) to a new company from September 1. It has also appointed former Aer Lingus (ARL) (CEO), Christoph Mueller as its new (CEO).

News Item A-3: Malaysia Airlines (MAS) is set to launch a nonstop service linking Zhengzhou in central China's Henan province with Malaysia' Sabah from July 26.

The nonstop service will be operated by a 737-800 once every five days. Flight MH8887 is scheduled to take of from Zhengzhou at 11:35 pm and land in Sabah at 4:00 am the next day, with a single trip of four and a half hours.

Zhengzhou airport has opened nonstop services to Japan's Osaka, Nagoya, Shizuoka, Vietnam's Da Nang, Malaysia's Sabah, and other international services, serving 570,000 international and regional passengers in the first half of this year, jumping +47% from the same period of last year.

News Item A-4: Malaysia Airlines (MAS) will end the Kuala Lumpur - Istanbul service on August 26.

(MAS) also confirmed it will downgauge capacity on the Kuala Lumpur - Paris route, by deploying Boeing 777-200ERs to replace the Airbus A380s. (MAS) did not specify when this change will take place.

“(MAS) is undertaking a network rationalisation exercise as part of the Recovery Plan announced last year. This has affected some routes which saw [a] complete cessation, or a reduction in frequency,” it explained.

(MAS) also competes with Air France (AFA) on the Kuala Lumpur - Paris route.

Istanbul would be the fifth destination (MAS) is dropping this year. In recent months, (MAS) had ended services from Kuala Lumpur to Frankfurt, Kochi, Kunming, and Krabi.

August 2015: News Item A-1: A completely-restructured airline will emerge September 1 from the tragedy-struck Malaysia Airlines (MAS) and will essentially take the form of a startup, new (CEO) Christoph Mueller said in an exclusive interview.

News Item A-2: "New Malaysia Airlines Berhad (MAB) gets (AOC)" by (ATW) Jeremy Torr, August 31, 2105.

Malaysia Airlines Berhad (MAB), the new entity spawned from the crisis-hit Malaysia Airlines (MAS), has been granted an air operator’s certificate (AOC) by the Malaysian Department of Civil Aviation (DCA).

The (AOC) came, following months of audit activities, including airworthiness operations, Maintenance Repair & Overhaul (MRO) conformance and regulatory conformity, the airline said.

Malaysian Minister of Transport, Datuk Seri Liow Tiong Lai said the (AOC) is “an important milestone in the evolution of Malaysia’s [new] national airline.” He said the Malaysian government is committed to ensuring the “new and rejuvenated Malaysia Airlines Berhad takes off on a strong note.”

The assets of the old Malaysia Airline Systems (MAS) were bought by Malaysian sovereign wealth fund Khazanah, last year for $1.6 billion, following several quarters of poor performance and the total loss of two 777 airplanes, MH17 and MH370, last year.

In March, MH370, a 777-200 with 239 passengers and crew, disappeared over the Indian Ocean, while on a flight from Kuala Lumpur to Beijing. Four months later, in July, MH17, also a 777-200, was shot down over Ukraine by a surface-to-air missile, while on a scheduled flight from Amsterdam to Kuala Lumpur. All 298 onboard were killed.

New (MAB) (CEO), Christoph Mueller was hired in May this year, and said the new entity would start from scratch as a full service regional carrier, following extensive job cuts and route rationalization over recent months.

Mueller, who was instrumental in the turnaround projects at underperforming carriers, including Ireland’s Aer Lingus (ARL) and Belgian carrier, Sabena (SAB), said the new entity would see a fresh approach for the Malaysian flag carrier. "It’s not a continuation of the old company in a new disguise, - - everything is new,” he said.

Chairman of the new (MAB) entity, Tan Sri Md Nor Yusof, described the (AOC) as the start of a new beginning, and added that under the new management of (CEO) Mueller and new owners Kazanah, all staff would “endeavor . . . and persevere, to build a sustainable national icon.”

The new airline is to begin operations as the new entity September 1.

October 2015: News Item A-1: "Governments Failed Those on Board Flight MH17" by Karen Walker in (ATW) Editor's Blog, October 13, 2015.

The Dutch Safety Board (DSB) report (just released) on the downing of Malaysia Airlines (MAS) flight MH17 is welcome in that it definitively states that the Boeing 777-200 was shot down by a Russian-built surface-to-air missile.

A criminal investigation report next year will, hopefully, decide who is responsible for that act, which killed all 298 passengers and crew on board. All were completely innocent citizens doing what millions of ordinary people do every day (take a commercial airline flight to a destination for work, pleasure or family reasons). The report makes clear that they died because a (BUK) missile targeted the airliner, detonated and blasted those on board with shrapnel, instantly destroying the 777 airplane.

The (DSB) report was also correct to note there was “a blind spot in the risk assessment process” that resulted in MH17 ending up in harm’s way, above a war zone in Ukraine, on that fateful July day in 2014.

(DSB) Chairman, Tjibbe Joustra noted that there had been earlier shoot-downs of military aircraft in the area by weapon systems that could reach airliners’ cruising altitudes. In other words, there were red flags, but Ukrainian authorities did not close the endangered airspace.

So the report concludes that while no form of risk assessment can be perfect, the aviation sector must take more account of a changing world and that “the ball is now in the court of the states and the aviation sector” to make adjustments.

To which I would say, this ball is firmly in the court of states and intelligence agencies. That’s where the information sits about potential dangers to civilian lives, whether it’s from recognized government military forces, non-state agencies or terrorist organizations.

Airlines are not in the business of monitoring such activity, nor should they be. In today’s world, it makes sense for an airline to have a good risk assessment team, but good decisions can only come from good information.

Airlines do not want or need classified intelligence or the sources of that information. They just need timely and actionable information. Eighteen months on from MH17, such information is still too hard to access.

MH17’s flight plan from Amsterdam to Kuala Lumpur was approved by Eurocontrol, and as they entered Ukraine airspace, the crew abided by Ukrainian air traffic control (ATC) instructions to fly at 33,000ft. Other airliners were on similar routes that day.

Airlines are responsible for the safety of their operations, but governments are responsible for providing safe airspace to commercial airliners. That’s a fundamental tenet of the global air transport community. All those on board MH17 were needlessly killed by a failing of that tenet.

NOTE: The following link is a video made by the (DSB) on the investigation. It sets out the whole story in a clear, methodical way. Excellent work by the investigators.

Reply comments to the above report:

DownandWelded Input: Yes Karen, there were 'other' airlines flying 'similar' routes at the time. But there were also airlines that had made a strategic corporate decision NOT to overfly the Ukraine at that time. The reasons for this - - and for (MAS) to have decided as they did regarding the routing - - needs to be examined. I can't help but feel that the airlines have more responsibility than you have attributed . . . to make safety decisions such as not to overfly certain (or perhaps all) areas of armed conflict. Approval of the flight by Eurocontrol or the flight's adherence to local air traffic control requirements does not - - in my view - - leave the airline blameless.

Karen's Reply: Hi DownandWelded, I see your point to the extent that yes, of course airlines have a responsibility for safety (and would add that it is their no 1 priority). But they still have to make risk assessments and, in these types of situations, good risk assessment decisions can only be made if there is good, clear and timely data from those who are charged with gathering that data. That's still the missing link, although I hope MH17 and the resulting task forces have gone some way towards closing the gap. So the onus is on governments first.

It has been noted before, but I'll reiterate that if MH17 had been a USA airline or the majority of passengers had been Americans, the response would likely have been more profound than a set of recommendations from a safety board 18 months after the event. This was not an accident; none of those on board should have died, and those who claim to have the best intelligence in the world should take the lead in ensuring it doesn't happen again by sharing that data in an appropriate way with the commercial air transport authorities.

AvGuy on October 14, 2015 wrote:

This is preposterous! Every airline in the world (that wasn't asleep for the preceding six months) knew that the Russians/rebels in Eastern Ukraine had already shot down multiple Ukrainian military aircraft - - not just combat aircraft, but also transport aircraft. Heck, every news-aware PERSON in the world knew it. It was on the nightly news!

Anyone flying airliners over Eastern Ukraine, at the time MH17 was shot down, was simply criminally reckless ("negligent" doesn't come close to adquequately describing that corporate misconduct).

This is so typical of the editorials in (ATW): Blame the government for regulating too much - - then, when some catastrophe happens, blame the government for doing too little.

The airline industry is largely self-governed - - even by the "regulators" who "oversee" it: The regulators, who are largely hired from the regulated industry to which they will return after their departure. The utterly corrupt "revolving-door" system of the regulated supplying the regulators - - and rewarding the permissive ones when they leave government - - puts the airline industry in position to, essentially, be regulated only by their own interests, and that of the lawsuit attorneys, who provide the only real check on their greed.

If the airlines (not just the Malaysian Airlines (MAS)), but EVERY airline that flew innocent passengers over the war zone - - aren't held to account, criminally, for putting profit ahead of decent, common-sense regard for human life, then this will happen AGAIN, regardless of any "regulators" in power.

"AvGuy" on October 15, 2015, continued:

Just to be thorough, blame lies first and foremost with Russia, who invaded Crimea, and incited, armed and fueled the Eastern Ukraine insurrection, turning that region into a war zone. Blame lies, secondly, with the ethnic Russians of Eastern Ukraine, who conducted the insurrection, and were possibly the "trigger-men" manning the Russian anti-aircraft weapons that were used against aircraft over that region.

But, next, the blame for the downing of MH17 lies with the people who deliberately chose to ignore the danger, and fly airliners there, and over there on the way to other countries, anyway. To be sure, (MAS) appears most culpable. But don't overlook all the other airlines that did the same, and simply lucked out.

Major national and international business figures are arrested for bank fraud, sports rigging, drug running. Why not for directing an airliner to fly innocent men, women and children (who don't realize the danger, and often don't even know where exactly they are overflying on a long voyage) over a combat zone, and getting them killed?

"FredF" on Oct 16, 2015 wrote:

It's disingenuous to focus blame on the people of eastern Ukraine for pursuing self-determination, or the Kremlin for responding to their calls for help, without mentioning the civil authority which controlled the airspace: the government of Ukraine. Despite having lost multiple aircraft to rebel fire in the days leading up to MH17 being shot out of the sky, Ukraine did not close the airspace to civil air traffic.

One can understand that an airline based in Malaysia, and even the Malaysian government, would have a weak understanding of the current status of a conflict in Ukraine, half a world away. The Ukrainian government has no such excuse.

Every government has the duty to provide airspace that is safe to navigate (directly or through a third party) or else close the airspace to civil traffic. No ifs, ands or buts.

Karen Walker on Oct 17, 2015 replied:

FredF, very well put and thank you for your comment. K.

See also attached article by Henry Chu of the Los Angeles Times titled
"MAS-2015-10 - 777 Hit by BUK Missile.jpg."

News Item A-2: The visa relaxation rules for Chinese tourists will bring in more tourists to Malaysia, said Chinese Ambassador to Malaysia, Dr Huang Huikang.

Commenting on the relationship between Malaysia and China, Dr Huang said both countries had historical, cultural, traditional, and blood ties which have surpassed many centuries. "I am promoting Penang aggressively to Chinese businessmen and Chinese manufacturing companies to be major investors in the state in the near future," he said after making a visit to the Penang Chinese Chambers of Commerce.

Dr Huang also said the Chinese Consul General office would be operational by the end of the year to facilitate visa requirements for Perak, Penang, Kedah, and Perlis.

He said Air China (BEJ) would resume its Beijing - Kuala Lumpur direct flight from now onwards while Malindo Air (MXD) would also start its Kuala Lumpur - Penang - Hainan route next month. He added that another airline in China was also planning to launch a direct flight from Hainan to a destination in Malaysia.

Dr Huang also tried out the famous cendol stall in Lebuh Keng Kwee after attending the opening of a solar factory on the mainland. He walked to the stall with his wife Zhao Shumei from his hotel to savor the signature delicacy. "The cendol tastes the same as the one from my hometown of Zhe Jiang. Although I've been to Penang several times, this was my first visit to the cendol stall," he said.

December 2015: News Item A-1: "Malaysia Airlines (MAS), Emirates (EAD) Agree to Extensive Code Share Pact," by (ATW) Aaron Ka, December 2, 2015.

Malaysia Airlines (MAS) and Emirates Airline (EAD) have agreed to a “strategic partnership” that both carriers touted as a major extension of their networks.

The accord is particularly significant for (MAS), which gained a new air operator’s certificate (AOC) in August, as it attempts to start over and rebuild, following years of financial losses for the former Malaysia Airlines (MAS) and the loss of two Boeing 777s, MH370 and MH17, in fatal crashes in 2014. The agreement will include extensive code sharing to be implemented “progressively throughout 2016 subject to regulatory approvals,” according to a statement released by the carriers.

(MAS) (CEO), Christoph Mueller said the partnership “paves the path towards an integrated customer proposition offering for both airlines.” The airlines plan to give passengers reciprocal lounge access and priority check-in.

“The improved connectivity will enable (MAS) customers to reach up to 38 destinations in Europe on a daily and even double daily basis for key European cities such as Zurich, Rome, Munich, Frankfurt, Madrid, and Barcelona,” Mueller said. “This partnership gives our customers access to a dramatically expanded range of travel options.”

Emirates (EAD) President, Tim Clark added, “Our new code share agreement with (MAS) will enable our passengers to experience new destinations and improved connectivity in the ever-popular Southeast Asia region. Malaysia Airlines (MAS)’ extensive network in the emerging Southeast Asia region perfectly complements (EAD)’s global network and enhances the choice of travel destinations for customers in both the business and leisure segment.”

Under the deal, (MAS) will add its code to (EAD) flights to Europe, the Middle East, Africa, and the Americas, according to the airlines. (EAD) will add its code to (MAS)’s domestic routes in Malaysia, as well as (MAS)’s flights in Southeast Asia and some longer flights to selective Asia-Pacific cities.

News Item A-2: Firefly ((IATA) Code: FY, based at Penang) (FFM) said a recently signed code share agreement with parent Malaysia Airlines (MAS) came into effect on December 22. Initially, the deal will see (FFM) placing its 'FY' flight code on (MAS) flights from Kuala Lumpur International to Kota Kinabalu, Kuching, Labuan, and Penang with more destinations to roll-out in the future.

"Together with (MAS), we at Firefly (FFM) are ecstatic to be able to provide customers with more travel options," (FFM)’s Chief Executive Officer (CEO), Ignatius Ong said. "We have no doubts that the offering of the ability to book flights to East Malaysia will be a boon to our loyal customers. With the launch of these initial three routes; (FFM) will gradually increase the number of code share routes with (MAS) in 2016."

Firefly (FFM) operates a fleet of nineteen ATR72-500/600s on flights throughout Malaysia as well as to Banda Aceh and Medan Kuala Namu in Indonesia, Singapore Changi, and Koh Samui, Krabi, and Phuket in Thailand.

News Item A-3: "Investigators: Both MH370 Engines Flamed Out; Search Narrowed" by (ATW) Aaron Karp, December 3, 2015.

Australian investigators believe both of Malaysia Airlines (MAS) flight MH370’s engines flamed out, suggesting the Boeing 777-200 was not intentionally ditched. Also, new analysis has narrowed the search area for MH370, giving officials renewed hope of finding the airplane.

The Australian Transport Safety Bureau (ATSB) has issued a new report on MH370 based on research and analysis conducted by the Australian Defense Science & Technology Group that confirms the search for the missing 777 is generally being conducted in the right area of the southern Indian Ocean. But it narrows the search area to the southern portion of a search area that spanned 120,000 sq km.

“There’s around 44,000 sq km yet to be searched in this new priority area, and we’re optimistic and hopeful that that search will result in us locating the airplane,” Australian Deputy Prime Minister, Warren Truss said at a news conference following the report’s release. Truss said he expected the “new priority area” to be completely searched by June 2016. He added that there will be “maximum effort” to put the “best [search] equipment in the right places, so we can conclude this search as quickly we can.”

Significantly, the (ATSB) report cites satellite and meteorological data, including the final satellite communication transmission from the airplane, indicating that both of the airplane’s engines flamed out. Investigators also relied on 777 performance characteristics provided by Boeing (TBC).

The analysis concludes that after MH370 had been airborne for 7 hours and 38 minutes, “fuel exhaustion was probable,” according to the (ATSB). “It is likely that the right engine flamed out first followed by the left engine.” The (ATSB) said the left engine “could have continued to run for up to 15 minutes after the right engine flamed out.”

The (ATSB) said the evidence of a double engine flame-out is “inconsistent with a controlled ditching scenario.” The (ATSB) said that “a controlled diching scenario requires engine thrust to properly control the direction and vertical speed at touchdown and to provide hydraulic power for the flight controls including the flaps.”

MH370 with 239 passengers and crew aboard veered from its planned course about 40 minutes after taking off from Kuala Lumpur bound for Beijing on March 8, 2014. There was no sign of the 777 until late July 2015, when a piece of airplane wing was discovered on Reunion Island in the Indian Ocean. The airplane debris was later determined by specialists in France to be from MH370.

News Item A-4: "Malaysia Airlines (MAS) to Decentralize Flight Operations" by (ATW) Jeremy Torr December 10, 2015.

Malaysia Airlines Berhad (MAS) plans to pare down its operations at its hub at Kuala Lumpur International Airport (KLIA) as part of an extensive reorganization. It will also create seven new permanent bases across Malaysia to “improve connectivity and service quality on the domestic network.”

The new arrangement, expected to be in place by early next year, will see 18 of (MAS)’ 50-plus Boeing 737-800 aircraft moved from (KLIA) to operate out of Kota Kinabalu, Kuching, Miri, Labuan, Kota Bahru, Penang, and Johor Baru.

Locally, employed pilots (FC) and cabin crew (CA) staff will be used to crew the airplanes, instead of crewing arrangements being made out of (KLIA) as previously.

The decentralization is expected to bring (MAS) lower airport charges, smaller crew accommodation bills and better regional utilization of its narrow body fleet. The move will also enable (MAS) to concentrate all its Flight Operations in a single terminal at (KLIA). (MAS) said this will allow it to offer faster and simpler connections for passengers between international and domestic flights, along with faster and more reliable baggage transfer.

(MAS) said it is seeing revenue per available seat miles and overall seat load factor up from the corresponding period in 2014, due partly to other improvements and network optimization.

(MAS) has also moved its headquarters to a single building in (KLIA)’s South Support Zone. Management said the new environment has improved teamwork across divisions and led to better working access, working values and behaviors. “It is very rewarding to see the new team of employees creating a truly new airline, one that is entirely customer focused and commercially led,” (MAS) (CEO), Christoph Mueller said. Mueller added “We still have a long way to go but [we] believe in our success.”

News Item A-5: "Malaysia Airlines (MAS) Cautioned Over Immigration Procedures" by (ATW) Jeremy Torr, December 16, 2015.

Malaysian flag carrier, Malaysia Airlines Berhad (MAS) has been criticized by the Malaysian government for poor application of immigration procedures. The issue came about following an incident where international passengers were allowed undocumented entry into Kuala Lumpur International Airport (KLIA).

Malaysian Deputy Home Minister, Nur Jazlan Mohamed said passenger checking was the responsibility of all operators, which was not done on this occasion. “[Airlines] should play their role by ensuring passengers on international flights go through the immigration check,” he said. “Procedures require passengers on international flights to be processed, like stamping of their passport, but this was not observed [in this case],” he said.

The lapse occurred December 12 following severe weather, which affected (MAS) flight MH741 from Yangon, Myanmar, to (KLIA). The aircraft and its 135 passengers were diverted to Langkawi International Airport (LGK), where passengers disembarked before joining a later flight to (KLIA).

Minister Mohamed said only 32 passengers were processed at (LGK) immigration. He has since raised the problem of passengers entering the country illegally via (KLIA) operator, Malaysia Airports Holdings Bhd (MAHB), but said it was “the responsibility of the airline concerned to ensure [international] passengers went through immigration procedures on arrival to prevent illegal entry of foreigners into the country.”

However, many MH741 passengers were not subjected to passport or immigration checks at (LGK); this was left pending until arrival at (KLIA). As the replacement (LGK) - (KLIA) flight was a domestic service, many international passengers deplaned without being subjected to immigration checks.

(MAS) said the oversight was the result of “efforts to get passengers to the intended destination as quickly and safely as possible.”

Malaysian Inspector-General of Police, Tan Sri Khalid Abu Bakar described the incident as “a clear breach of security,” and suggested passengers that had not processed by immigration “to immediately go to their nearest police station.”

News Item A-6: "Malaysia Airlines (MAS) Aircraft Given Wrong Flight Plan" by (ATW) Jeremy Torr, December 28, 2015.

A Christmas day Malaysia Airlines Berhad (MAS) flight from Auckland, New Zealand, to Kuala Lumpur, Malaysia flew an incorrect flight path after (MAS) submitted the wrong flight plan to New Zealand Air Traffic Management (ATM) operations at Auckland Airport.

The Airbus A330 was scheduled to fly north, but after takeoff, headed west toward Australia instead of taking the usual northward flight path. "On December 24, 2015 flight MH132 from Auckland to Kuala Lumpur was given the latest flight plan by [our] Operations Dispatch Center," the airline said. However, added the airline, "Auckland's Air Traffic Control (ATC) was inadvertently given an earlier flight plan."

The aircraft's crew alerted (ATC) staff at Auckland Airport of the conflicting flight instructions.

(MAs) said that there was no danger to the aircraft or passengers and crew, and that the deviation (which was corrected some eight minutes after takeoff) had no effect on the fuel reserves the aircraft was carrying.

"Both [supplied] routes were following an approved flight path and the aircraft had enough fuel for both routes," it said. (MAS) said it will carry out an investigation into the flight plan mix up.

"Safety is of the utmost priority for Malaysia Airlines (MAS) and it adheres very strictly to all safety procedures and processes," (MAS) said.

This was the second procedural error involving (MAs) in December, after passengers from Yangon were inadvertently disembarked without passing through immigration.

The search continues to locate the still-missing Malaysia Airlines (MAS)’ Boeing 777-200 that disappeared in March 2014 after diverting from its planned route from Kuala Lumpur to Beijing. The 777, flying as MH370, is believed to have crashed in the southern Indian Ocean, but why it diverted so far from its course and what happened has not been established.

January 2016: News Item A-1: Malaysia Airlines (MAS) abruptly put a temporary suspension on all checked baggage on its flights to Europe, citing strong head winds and safety concerns.

In an initial statement issued on January 5, (MAS) said it was only able to carry hand luggage on services from Kuala Lumpur to Europe. Passengers can still check in luggage, but it will be sent “later,” on a separate flight “as soon as the situation permits.”

“In the interest of safety, (MAS) currently operates a long route to Europe via Egypt airspace, which combined with strong head winds, is delaying flights and limiting the airline’s baggage capacity. This longer flight path consumes more jet fuel and for safety reasons, (MAS) has had to impose a temporary limitation on checked-in baggage.”

The restriction initially affected (MAS)’s Amsterdam, London and Paris services, although normal baggage allowances have since been restored on its Airbus A380-operated London route. “Baggage limitations, however, still apply for flights to Amsterdam and Paris on January 5 - 6, 2016.”

(MAS) did not explain why there were no longer any concerns for London flights, while Amsterdam and Paris flights were still affected by the ban, even though the distances between those airports is negligible on those long-haul routes.

No other airlines in Asia or Europe are reporting weight-and-fuel concerns related to headwinds and (MAS) is the only airline to issue a baggage restriction.

Under Malaysia Airlines (MAS)' temporary policy change, which took effect on January 5, economy (Y) passengers have been limited to a single 7 kg item of hand luggage and business (C) and first-class (F) passengers can carry two items not exceeding 7 kg each.

(MAS) cautioned that travelers transferring from other Oneworld (ONW) Alliance member airlines could have their baggage offloaded.

(MAS) did not give any timings for dropping the temporary limits, but said it would “continue to assess the changing situation over the region and update passengers when operations are back to normal.”

A British Airways (BAB) spokeswoman said its flights to and from Kuala Lumpur are operating normally. Air France (AFA) deferred comment to its sister airline (KLM) which said “(KLM) operates to and from Kuala Lumpur as scheduled and without any restrictions.”

A Oneworld (ONW) alliance spokesman said: “Malaysia Airlines (MAS) has been keeping (ONW) alliance and its partner airlines briefed on the exceptional circumstances behind this temporary arrangement covering its flights from Kuala Lumpur to Amsterdam and Paris. While this may be inconvenient for some passengers, the over-riding factor is to ensure safe operations.”

Normal baggage allowances on all (MAS) flights have been restored to two check-in bags up to 30 kg for economy (Y) class, 40 kg for business (C) class, and 50 kg for first (F) class as from January 6 evening flights.

News Item A-2: Malaysia Airlines Berhad (MAS) has confirmed the suspension of its Paris and Amsterdam routes will allow it to retire its remaining Boeing 777-200ERs, and that many of the pilots (FC) from this 777 fleet will also be leaving (MAS).

News Item A-3: Malaysia Airlines (MAS)’ new partnership with Emirates Airline (EAD) is allowing it to cut another of its long-haul services, suspending its flights from Kuala Lumpur to Dubai.

News Item A-4: "Russian Authorities Dispute (MAS) Flight MH17 Dutch Investigation Findings" by (ATW) Alan Dron, January 14, 2016.

Russia has told the Dutch Safety Board (DSB) that its final report into the crash of Malaysia Airlines (MAS) flight MH17 over eastern Ukraine in July 2014 contained “unsubstantiated and inaccurate” information.

All 298 passengers and crew were killed on board the Boeing 777-200, which was shot down over Ukraine en route from Amsterdam to Kuala Lumpur. The (DSB)’s final report, issued in October 2015, said it was conclusively proved that the 777 was downed by a (BUK) surface-to-air missile.

The incident happened during the height of conflict in eastern Ukraine between Ukrainian government forces and Russian-backed rebels. Each side claimed that the other was responsible for the downing of Flight MH17.

The (DSB) report was careful not to assign responsibility for the event. This is expected to come as part of a Dutch criminal investigation into the crash, due to report later this year. But investigators reconstructed sections of Flight MH17’s fuselage and the report said it was clear that a 9N314M warhead, the type used on the (BUK) missile system, had detonated around 1 meter above and to the left of the cockpit, killing all three flight crew (FC) members instantly. Pre-formed fragments from the warhead were found in their bodies.

The Russian response to that report, released in October, comes in a letter from Oleg Storchevoy, Deputy Director of Russia’s Civil Aviation Regulator, Rosaviatsia to (DSB) Chairman, Tjibbe Joustra.

In the letter, Storchevoy writes that Russian experts continued their research into the crash, based on additional information released in the final report. “Additional experiments and examinations attest to the fact that information provided in the final report” in regard to several of the (DSB)’s conclusions were “unsubstantiated and inaccurate.”

Storchevoy adds that Russian experts carried out a full-scale experiment in which a 9N314M warhead of the type used in the (BUK) system was detonated close to an Ilyushin Il-86 cockpit in the same position as that described in the (DSB) report.

He said that several anomalies were found:

* the shape and chemical composition of warhead fragments retrieved from the wreckage of Flight MH17 did not match those of the pre-formed fragments produced by the 9N314M warhead;

* penetration holes in the wreckage were not consistent with the shape of the warhead’s fragments;

* the algorithm used to detonate the 9N314M’s proximity fuse would not have produced the fragmentation spray pattern found on the Boeing 777;

* the anomalies found in the damage pattern mean that the warhead detonation point and missile orientation could not have been as described in the (DSB) report. In turn, this would mean that the possible launch area of the missile was calculated incorrectly.

The last point appears to be aimed at casting doubts that the missile was fired from an area of Eastern Ukraine controlled by anti-government rebels.

Russia also argues in the letter that the Ukrainian authorities must take responsibility for ignoring safety risks to civil aircraft over eastern Ukraine. Civil flights over the region should have been suspended months before the tragedy. This is, however, a moot point as the (DSB) investigation’s mandate was to establish what happened to Flight MH17, not who was responsible.

A (DSB) spokeswoman said on January 14 that it would examine the contents of the Russian letter before making any comment.

February 2016: News Item A-1: Malaysia Airlines (MAS) is handing over its daily Kuala Lumpur to Dubai A330-300 service on February 15 to its code share partner, Emirates Airline (EAD) for a 4x-daily schedule.

News Item A-2: Malaysia Airlines (MAS) has deferred plans to sell off its fleet of A380-800s at least until 2018, (CEO) Christoph Mueller has told Reuters news agency.

"We need them for the long haul market," he said. "We are still evaluating what we want to do with the A380. We have 6 and we will keep them at least until 2018, when we get the 1st A350."

(MAS) is scheduled to take delivery of its first of four A350-900s on lease from Air Lease Corporation (ALE) from late 2017.

March 2016: News Item A-1: "Malaysian Minister Urges Caution, but Says Debris Looks to be from 777" by (ATW) Aaron Karp, March 2, 2016.

Malaysia’s Transport Minister said there is a “high possibility” that airplane debris found off the coast of Mozambique is from a Boeing 777, though he urged caution in linking the debris to Malaysia Airlines flight MH370.

Reports of airplane debris found washed up on a sandbank off the coast of Mozambique set off international speculation that the object belonged to MH370, the 777-200 that went missing on March 8, 2014 with 239 passengers and crew on board. Other than a flaperon found on Reunion Island in July 2015 (later confirmed to be part of the missing 777), there has been no trace of the airplane.

Investigators from Malaysia, Australia and the USA were reportedly taking the new debris found in the Mozambique Channel seriously based on photographs, but there was no official comment initially. However, Malaysian Transport Minister, Liow Tiong Lai said on his official Twitter feed that “based on early reports,” there is a “high possibility” that the debris “belongs to a 777.”

Because there have been so few 777 crashes and the newly found debris is in the general area where MH370 is believed to have gone missing, a found, verified 777 part would most likely be from MH370. However, Liow cautioned that the Mozambique debris being from a 777 “is yet to be confirmed and verified.” He said Malaysian and Australian authorities are working together to retrieve and examine the debris.

Liow said he is urging “everyone to avoid undue speculation, as we are not able to confirm the debris belongs to MH370 at this time.”

News Item A-2: "(ICAO) Adopts New Distress Circumstance Aircraft Tracking Requirements" by (ATW) Aaron Karp, March 7, 2016.

(ICAO) has adopted new aircraft tracking provisions, including a requirement that aircraft carry a device that can autonomously transmit its location every minute during emergency circumstances.

On the eve of the second anniversary of the disappearance of Malaysia Airlines flight MH370, (ICAO) announced that its 36-member state governing council had adopted amendments to the Chicago Convention related to aircraft operations “aimed at preventing the loss of commercial aircraft experiencing distress in remote locations.”

The new provisions are separate from (ICAO)’s proposal for airlines to adhere to a standard of reporting aircraft position at least once every 15 minutes when in oceanic or remote airspace.

(ICAO) originally planned for that standard to become applicable in November 2016, but the applicability date for the 15-minute reporting requirement has been pushed back to November 2018, according to (ICAO) spokesman, Anthony Philbin. (IATA), among others, had questioned whether it was feasible to implement the reporting requirement as soon as this year.

All of the new standards announced March 7 relating to distress circumstances will take effect by 2021, (ICAO) said. Some of the requirements will take effect sooner, but there is “varying applicability” for the provisions owing to technical issues.

(ICAO) said that the new distress circumstance requirements primarily cover three areas:

1) Aircraft will be required to carry tracking devices “which can autonomously transmit location information at least once every minute in distress circumstances.”

2) Aircraft will be required to be equipped “with a means to have flight recorder data recovered and made available in a timely manner.”

3) Cockpit voice recordings will be required to be extended to 25 hours “so that they cover all phases of flight for all types of operations.”

(ICAO) is not dictating how airlines comply with the new requirements, which will be performance-based rather than technology specific, “meaning that airlines and aircraft manufacturers may consider all available and emerging technologies, which can deliver the one-minute location tracking requirement specified,” (ICAO) stated.

The new requirements related to distress circumstances “are consistent with the findings and recommendations of the multidisciplinary ad-hoc working group (ICAO) formed after Malaysia Airlines MH370 went missing in March 2014,” (ICAO) council President Olumuyiwa Benard Aliu said, adding that the new standards will “greatly contribute to aviation’s ability to ensure that similar disappearances never occur again.”

Aliu said the “new provisions will ensure that in the case of an accident, the location of the site will be known immediately to within six nautical miles, and that investigators will be able to access the aircraft’s flight recorder data promptly and reliably.”

News Item A-3: "MH370: Where Do We Stand 2 Years Later?" by (ATW) Aaron Karp in AirKarp, March 8, 2016.

Today, March 8, marks the grim two-year anniversary of the disappearance of Malaysia Airlines (MAS) flight MH370, the Boeing 777-200 with 239 passengers and crew aboard, that veered from its planned course about 40 minutes after taking off from Kuala Lumpur bound for Beijing. Where do we stand 2 years later in 3 key areas: Finding MH370, figuring out what happened, and implementing flight tracking requirements?

* Finding MH370

There was stunningly no trace of the aircraft at all until late July 2015 (>16 months after the flight disappeared) when an airplane part (a flaperon) that was later confirmed by French investigators to have come from MH370, was found on Reunion Island. Malaysian Transport Minister, Liow Tiong Lai has said there is a “high possibility” that another airplane part found just last week off the coast of Mozambique is from a 777. If it is confirmed that the newly found debris is from a 777, then it would likely be another part from MH370, since there is no other 777 unaccounted for in that area of the world (or anywhere else). Satellite and meteorological data analysis done by the Australian Defense Science & Technology Group did narrow the MH370 search area in the southern Indian Ocean late last year. But 2 years later, that’s where things stand: 1 confirmed part, another unconfirmed part and 44,000 square km of “priority area” being searched in a vast, deep ocean.

What happened? The finding of at least one airplane part squelched the wildest theories, such as the aircraft being hijacked and landing safely on a remote island or that it was sucked into a black hole (which was actually discussed on (CNN) News). There continue to be many theories, though because so little of the airplane has been found (including, significantly, no flight data recorder and no cockpit voice recorder) there is little substantive evidence for any of them.

The most serious findings have come from the Australian Transport Safety Bureau (ATSB), which has cited satellite and meteorological data (including the final satellite communication transmission from the 777) indicating that both of the airplane’s engines flamed out. Investigators also relied on 777 performance characteristics provided by Boeing (TBC).

The (ATSB) concluded that after MH370 had been airborne for 7 hours and 38 minutes, “fuel exhaustion was probable. It is likely that the right engine flamed out 1st, followed by the left engine.” The (ATSB) said the left engine “could have continued to run for up to 15 minutes after the right engine flamed out.”

The (ATSB) has noted that the evidence of a double engine flame-out is “inconsistent with a controlled ditching scenario” because “a controlled ditching scenario requires engine thrust to properly control the direction and vertical speed at touchdown and to provide hydraulic power for the flight controls including the flaps.” In other words, no one was likely “controlling” the airplane, when it hit the ocean; the airplane ran out of fuel and its engines shut down. This doesn’t rule out a nefarious act by a pilot (FC), but it also does not rule out other scenarios. The central questions remain: Why did the airplane fly so far off course? Why did it apparently keep flying until it eventually ran out of fuel?

As unsatisfying as it may be, the truth is we don’t know what happened.

* Flight tracking requirements

There was a lot of hue and cry immediately after MH370 disappeared to considerably and quickly beef up the requirements for tracking commercial airplanes, particularly in remote, oceanic areas. However, two years later, the results have been mixed.

(ICAO), the (UN) body governing civil aviation, has come up with two key requirements: 1) In standard circumstances, airlines will adhere to a requirement of reporting airplane position at least once every 15 minutes when in oceanic or remote airspace. 2) For “distress circumstances,” airplanes should carry tracking devices “which can autonomously transmit location information at least once every minute.”

Number 1 was supposed to go into effect in November of this year, but pressure from airlines, among others, have pushed back the applicability date of this requirement to November 2018. Number 2, just announced March 7, won’t go into effect until 2021. There have been some very promising technological advancements and trials regarding the tracking of flights, particularly using satellite capabilities, and flight tracking will probably eventually be fairly comprehensive in the future. But the operative words are “in the future.”

So, getting back to the question I posed at the beginning of this post: Where do we stand 2 years later? Quite honestly, pretty close to where we stood 2 years ago. That’s not to discount an incredible amount of work done by a lot people of good will. But here are the undeniable facts: barely any of the 777 has been found, there is little idea of why it crashed, and when you board a commercial flight on March 8, 2018 (two years from now, four years after MH370’s disappearance) there will still be no requirement in place that the airplane report its position in 15-minute intervals.

News Item A-4: Malaysia Airlines (MAS) is considering buying more Airbus A350 widebodies and has seen a year-over-year +10% improvement in its revenue per available seat km (RASM) for the quarter ended February, (MAS) said on March 4.

Announcing latest updates in its restructuring process, (MAS) said there was “sustained progress amidst a backdrop of external macroeconomic fluctuations”. “We have seen a challenging quarter, but I am pleased to see continued progress made in all key areas such as on-time performance and costs. (MAS) has been operating for six months now and although it has have a long way to go and areas for improvement, it is making steady progress in the restructuring,” (MAS) Group (CEO) Christoph Mueller said.

“We are focused on building momentum with our restructuring in 2016. Diligent execution on efficiency and tighter cost controls has already produced results which have seen us emerging leaner and more focused.”

(RASM) for the quarter improved +10% on the back of route optimization, (MAS) said. There was also a marked improvement in (MAS)’s on-time performance. After a dip in December, attributed to adverse weather conditions and constraints in availability of aircraft, punctuality reached 85% in February 2016. On February 17, the airline hit a record 95% punctuality across all flights, with 100% on domestic operations.

(MAS) has completed retirement of its Boeing 777-200s and is scheduled to take the first of four A350-900s in October 2017. The aircraft are being leased from Air Lease Corporation (ALE).

“(MAS) is evaluating additional A350s in order to reach a critical fleet size, allowing standby aircraft for any scheduled maintenance and enabling future network expansion. Malaysia Airlines (MAS) actively assesses new route opportunities on an on-going basis and is currently evaluating the possibility of serving unique and new destinations that would require new equipment,” (MAS) said.

(MAS)’ Airbus A380s, meanwhile, are due for scheduled maintenance at the beginning of the second quarter this year, which will mean an average of one A380 aircraft being out of commission for the remainder of 2016. In anticipation of this, the airline is exploring reinstating an aircraft to ensure minimal interruptions on the London route, (MAS) said.

A key component of the company’s restructuring is its partnership agreement with Emirates Airlines (EAD) and (MAS) said the 1st phase of that deal will see 11 destinations introduced, including Rome, Paris, Madrid, and Frankfurt, with the rest being added progressively over the next few months subject to regulatory approvals.

News Item A-5: Malaysia Airlines Berhad (MAS) may bring 747-400s out of storage to cover for Airbus A380s, while they undergo maintenance checks this year.

April 2016: News Item A-1: "Malaysia Airlines to Recommission 747 for Domestic Routes" by (ATW) Jeremy Torr, April 6, 2016.

Malaysia Airlines Berhad (MAB) will repaint one of its Boeing 747-400 airplanes in original 1970s livery before bringing it back into service on domestic schedules in the coming months.

(MAS), the Malaysian flag carrier, which was restructured in a $6 billion/$2.7 billion government bailout last year, has 3 Boeing 747 airplanes in storage, and is to bring at least 1 back into service by the end of April this year, (MAS) said.

“The newly liveried airplane, bringing the spirit of Malaysia Airlines (MAS)’ proud history to local communities, will be flying selected domestic destinations,” it said.

A significant drop in the price of jet fuel has meant many regional carriers (including Cebu Pacific (CEB), Philippine Airlines (PAL), and Cathay Pacific (CAT)) are still running old-generation wide body airplanes to minimize costs.

Indonesian carrier, Lion Air (MLI) has also pioneered the use of wide body aircraft on local Asian schedules last year, looking at employing Airbus A330s on heavily trafficked domestic routes.

(MAS) (CCO) Paul Simmons said the “retro livery” 747 airplane will initially be used as an operational spare airplane to be assigned on an ad hoc basis to destinations, as and when required.

(MAS), which is due to take delivery of its 1st Airbus A350-900 in October 2017, has also been reportedly looking at cutting its fleet of Airbus A380 aircraft.

News Item A-2: Malaysia Airlines Berhad (CEO) Christoph Mueller has said he will resign in September, citing “changing personal circumstances.”

The unexpected announcement comes less than a year after Mueller took over the top executive spot at Malaysia Airlines (MAS). The former Aer Lingus (ARL) (CEO) known for turning around airlines, was named (CEO) of (MAS) in late 2014 as (MAS) was dealing with the aftermath of two fatal Boeing 777 crashes (flights MH370 and MH17) and took the position on May 1, 2015.

He said he was treating (MAS) as a startup carrier and the airline’s operations, assets and liabilities were shifted to a new company, Malaysia Airlines Berhad, which officially launched on September 1, 2015 with a new air operator’s certificate (AOC). Malaysia Airlines Berhad said late last year it would pare down operations at its Kuala Lumpur International Airport hub as part of a reorganization and it agreed to a strategic partnership with Emirates Airline (EAD).

Malaysia Airlines Berhad Chairman, Md Nor Yusof said in an April 19 statement, “We are very disappointed to lose Christoph as (CEO), but we fully understand his reasons and respect his need to do this.” He said the search for a new (CEO) was underway.

Mueller said that he was “proud of what we have achieved as a team in such a short time and that the hard work of all of our employees is already showing the first signs of success.” He added, “The airline has been restructured and re-positioned to regain its leading position. I am confident that the company is now on the right track to succeed in its next phase of growth under a new (CEO).”

News Item A-3: "Stranded Rayani Air passengers get Fare Assistance" by (ATW) Jeremy Torr, April 13, 2016.

Following the grounding of Malaysia-based start-up, Rayani Air (RKT) on compliance grounds this past weekend, stranded passengers have been given assistance by other airlines, including Malaysia Airlines (MAS) and AirAsia (ASW).

(RKT), the low-cost carrier (LCC), which started operations in December 2015, had been given prior warnings by Malaysia’s Department of Civil Aviation (DCA) and was grounded on the basis of operational noncompliance over the weekend. Prior to the suspension, the (DCA) issued two warning letters over general noncompliance and poor service levels.

(RKT) canceled all flights late last week, citing pilot (FC) action. However, the (DCA) issued a statement saying this contravened its air operator’s certificate (AOC), as “an airline [must] provide at least six months’ notice to the (DCA), if it intends to cease operations.”

The (DCA) said it would undertake a full administration and safety audit of Rayani Air (RKT)’s state of operations, and will investigate the airline’s record to date, along with the operational record of its two Boeing 737-400s.

Passengers affected by the grounding will be able to apply to Malaysia Airlines (MAS) for discounted fares on the same routes as booked with (RKT), providing they can show proof of booking. “We are offering affected passengers special fares to connect them to their intended destinations,” Malaysia Airlines (MAS) (CCO) Paul Simmons said.

AirAsia (ASW) has made a similar offer, enabling all Rayani Air (RKT) passengers affected by the suspension to take a -50% discount on its fares to Langkawi, Kota Bharu, Kuching, and Kota Kinabalu, through April 27. “We empathize with all the affected (RKT) passengers and we hope that this 50% discount will help ease them in making new travel arrangements,” AirAsia (ASW) Head of Commercial Operations, Spencer Lee said.

May 2016: News Item A-1: 777 airplane debris found in late March on beaches at Mossel Bay, South Africa, and Rodrigues Island in Mauritius have been classified as “almost certainly” from missing Malaysia Airlines (MAS) flight MH370, according to the Australian Transport Safety Bureau (ATSB).

The Boeing 777-200, registration (9M-MRO), went missing March 8, 2014 with 239 passengers and crew. To date, no significant-sized parts or a potential crash site have been identified, despite a two-year search that has cost the Malaysian government over >$70 million and the Australian government >$60 million on a multi-disciplinary underwater search effort.

The 2 most recently discovered items of debris (part of a jet engine nacelle and fragment of decorative laminate) were analyzed by the (ATSB) following a request from the Malaysian government.

Following an examination of the fragments, the (ATSB) said one had a partial Rolls-Royce (RRC) logo that “did not match the original from manufacture,” but was consistent with the logo developed and used by (MAS) on other Boeing 777s in its fleet.

The 2nd item of debris was identified as an interior panel from an airplane main cabin. The (ATSB) said the remains of a piano hinge and the “pattern, color and texture of the laminate [were] only specified by [MAS] for use on [its] Boeing 747 and 777 airplanes.”

“There is no record of the laminate being used by any other Boeing 777 customer,” the (ATSB) report said, concluding that in the case of both fragments “the results from [our] tests concluded that [fragment 1] was a (MAS) 777 engine cowling segment and that [fragment 2] was a (MAS) 777 panel segment from the main cabin.”

The report concluded that as a result of the findings, both fragments of debris were “almost certainly from the 777 registered (9M-MRO).” The latest finds add to the discovery of a flaperon from MH370 on Reunion Island in the Indian Ocean late July 2015.

The (ATSB) said the new fragments and reports would be provided to the Malaysian investigation team.

News Item A-2: Malaysia Airlines Berhad (MAS), now a government-controlled entity of Malaysian sovereign wealth fund Khazanah, said in its May Quarterly Progress Update (QPU) it was seeing “strong indications [of] positive results” as a result of ongoing restructuring.

The Malaysian flag carrier said it was experiencing “good progress” on its turnaround plan, with a 23.4% rise in yield to MYR 0.23/$0.6 per passenger on the back of a significant -32.9% cut in operating costs over the quarter.

However, the (QPU) indicated that (1Q) overall revenue was down -21.7% with (ASK)s also dropping by -30.2%, partly due to the grounding of the majority of the carrier’s long-haul fleet.

The airline reported 3.2 million passengers carried in (1Q) 2016, with a relatively low load factor of 68.9% LF; however, (MAS) said this was now “trending upward.”

Lower fuel requirements and a lower oil price contributed “significantly” to an improved cost position, (MAS) said. It also said improved work efficiency and a significant headcount reduction resulted in a -40.5% cut in payroll costs before exceptional items.

(MAB) said these improvements had helped it become “ahead of budget at [both] operating and (EBITDAR) levels” as at the end of (1Q) 2016. However, it said it expected a weaker (2Q) 2016, and a probable overall loss at the end of 2016.

Nonetheless, (MAB) (CEO) Christoph Mueller said he was “delighted” at overall progress at the airline, even though he would not be able to complete his full term as (CEO). “By moving swiftly and making tough decisions early, we have reshaped the business for a strong, sustainable future,” he said.

News Item A-3: Malaysia Airlines (MAS) has exercised its option for a 12-year lease agreement for +2 additional A350-900 aircraft with Air Lease Corporation (ALE). The transaction is in accordance with the option provided under the existing lease contract for 4 A350-900s signed by both parties in September 2015.

June 2016: News Item A-1: "Malaysia and Lufthansa to Set Up Joint (MRO) Operation" by (ATW) Jeremy Torr, June 3, 2016.

Malaysian flag carrier, Malaysia Airlines Berhad (MAS) is to enter into a joint venture (JV) Maintenance Repair & Overhaul (MRO) operation with Lufthansa Technik AG (DLH) (LTK), based at Kuala Lumpur International Airport.

The facility will service aircraft for regional operators, with special provision for Boeing 737 and Airbus A320 aircraft.

The new venture will be managed out of (MAS)’s holding company Malaysia Aviation Group (MAG), a specially created entity within Malaysia’s Khazanah sovereign wealth fund. It is planned the new facility will come open in 2017.

The move comes following the buyout of the previous (MAS) incarnation, (MAS), by Khazanah in 2014, following poor results and the loss of 2 airplanes. At the time, the option of selling off (MAS)’ (MRO) capability was mooted, as it was one of the more profitable divisions.

(MAS) (CEO), Christoph Mueller said the joint venture (JV) with Lufthansa Technik (DLH) (LTK) would bring “tangible benefits” to the airline. “The level of skill, expertise and technological transfer will be invaluable, both for us and for Malaysia,” he said.

(DLH) (LTK) said the agreement would “introduce state-of-the-art technical capabilities for base maintenance services and best practices in operations” to the region. “We will significantly extend our (MRO) capabilities in 1 of the most emerging markets world wide," Lufthansa Technik AG (CEO) Johannes Bussmann said, adding that the link with (MAB) would bring “a strong regional partner to create a real success story with this new business."

News Item A-2: Malaysia Airlines (MAS) (COO) Peter Bellew has been named as its next (CEO) and Group Managing Director from July 1, taking over from Christoph Mueller, who was scheduled to leave in September.

Mueller resigned March 10 and was serving notice until September 9, but with Bellew’s appointment, he will step down from the board July 1. Malaysia Airlines (MAS) said Mueller will “remain available” until the end of his notice period to ensure a smooth transition.

Bellew joined (MAS) from Ryanair (RYR), where he was Director of Flight Operations. Prior to this, he held roles as (RYR) Deputy Director of Flight Operations and Head of Sales & Marketing.

Since joining Malaysia Airlines (MAS) in 2015, Bellew has worked alongside Mueller on (MAS)’s 12-point turnaround plan and restructuring. “Peter has been a key figure in the airline’s senior management team responsible for executing the biggest and fastest transformation in our history. He is an exceptional leader and has been an invaluable contributor to the transformation of the airline over the last 10 months,” (MAS) Chairman Tan Sri Md Nor Md Yusof said.

July 2016: News Item A-1: "Malaysia Airlines Pays Damages to MH17 Victims’ Families" by Hannah Davies, MRO-Network.com, July 19, 2016.

On July 17, the world remembered those who lost their lives 2 years ago on board the tragic Malaysia Airlines (MAS) flight MH17, again mourning the loss of 298 passengers and crew.

On the same day, it was reported that compensation would be awarded to many of the victims’ families, after settlements were agreed with (MAS).

According to (CNN) News, the lawyer representing 170 Dutch victims confirmed that a compensation settlement had been made “for an undisclosed amount."

It is believed that talks are still taking place to secure settlements for the rest of the victims.

Tragedy struck the (MAS) 777 on its route from Amsterdam to Kuala Lumpur when a Russian-made Buk missile struck the 777, causing it to crash in eastern Ukraine, killing all of those on board.

And since then, the victims’ families have had to endure lengthy investigations, unanswered questions and upsetting reports that suggest Ukraine shouldn’t have had its airspace open to commercial flights because of the conflict between Ukraine Government forces and Russia-backed separatists.

Ahead of the anniversary, the USA Department of State released a statement saying that it welcomed the findings of the Dutch Safety Board’s final report on the cause of the MH17 crash, released in October 2015.

But while the report “validated that MH17 was shot down by a surface-to-air missile”, the USA commented that it is continuing to work with the Joint Investigation Team and law enforcement authorities to help form the basis of an independent prosecution and bring the perpetrators of this tragedy to justice.

Indeed, the news that many of the families are to receive a settlement is welcomed, albeit bittersweet, yet the painful process of achieving justice for those responsible continues on.

News Item A-2: "New Setback for MH370 Recovery" by by Alex Derber, MRO-Network.com July 21, 2016.

With >90% of the search area for Malaysia Airlines (MAS) lost 777 MH370 now covered, the company leading recovery efforts has conceded it may have been looking in the wrong place all along.

Fugro Project Director, Paul Kennedy told "Reuters" that a piloted glide by the (MAS) 777 would probably have taken it outside the strip of the Southern Indian Ocean that has been focused on by search teams.

When investigators from China, Malaysia and Australia defined the search area 2 years ago, they assumed that the 777 ran out of fuel on autopilot and then plummeted via an uncontrolled descent.

A skilled pilot (FC) in the cockpit, however, might have been able to glide the airplane >100 km, though this theory raises difficult questions, notably why a pilot (FC) seemingly intent on saving the airplane would have allowed it to reach such a position in the 1st place.

More likely is the fact that extrapolating a landing zone from an electronic ping sent by the airplane's engine software was always going to be a task bedeviled with an uncomfortable amount of guesswork, and one further undermined by the vagaries of wind and ocean currents.

The Australian government, which is leading the search, made no mention of the glide theory in its update on the operation and none of the government agencies involved support the idea.

The update did reveal that the onset of winter weather in the turbulent Southern Ocean could delay conclusion of the search until spring.

However, with 110,000 of the 120,000 sq km ocean strip now investigated by surface scans, sonar, and underwater vehicles, hope is disappearing that MH370 will ever be found. "In the absence of credible new information that leads to the identification of a specific location of the airplane, Governments have agreed that there will be no further expansion of the search area," reads an Australian government statement.

News Item A-3: Malaysian authorities plan to implement increased security at airports across Malaysia following recent terrorist events at various transport locations across Europe.

Malaysian deputy Transport Minister Abdul Aziz Kaprawi said “increased security mechanisms” would be applied at airports such as Kuala Lumpur International Airport and Sepang, as well as at connected rail transport hubs such as KL Sentral.

The Minister specifically cited attacks at Turkey’s Istanbul Ataturk Airport and Belgium’s Brussels Airport in Zaventem as indicators of the need for increased security in Malaysia. “We will look into several aspects [of airport security] and will not allow any threat to slip into our airports,” he said. Speaking in Kuala Lumpur, the Minister said that although the government was “serious in tackling security threats” and was working on new cross-departmental mechanisms to improve internal cooperation, it was committed to avoiding increased delays or administration to operators.

“Any new security mechanisms would take into consideration the design and infrastructure at existing airports in order not to affect business activities,” Kaprawi said. Kaprawi added the Malaysian government was conducting an intensive vetting process into recruitment processes at the country’s airports.

The beefed-up security measures come following the revocation of an air operator’s certificate (AOC) for Malaysia-based Rayani Airlines (RKT) in March 2016. (RKT) had its permit revoked for operational lapses, including boarding security and on-time compliance.

News Item A-4: A new cement grouting procedure used at Malaysia’s Kuala Lumpur International Airport 2 (KLIA2) airport has resulted in “a significant improvement in [the number and] incidence of soil depressions” with a concurrent reduction in standing water, or ponding, airport operator Malaysia Airport Holdings Bhd (MAH) said.

“Grouting injection remains the method of choice [for repairs resulting from soil settlement] as it also provides less disruption to terminal operations,” (MAH) said in a report on the runway and apron maintenance progress at (KLIA2).

The maintenance upgrades (which affect some 54 locations or 19% of the total 1.48 million km2 at (KLIA2)) have been the subject of an ongoing dispute with carriers, including AirAsia (ASW), over the readiness of the airport to handle significant traffic volumes without disruption. The airport has flagged 12 taxiway and 42 parking apron bays as needing remedial work.

(MAH)’s maintenance progress to date has seen 27 out of 39 areas grouted for 2016, nearly 70% of those scheduled. However, (MAH) said the efficiency of the new grouting method had allowed it to “reduce injection works to 29 locations including four locations on the taxiway,” by avoiding open excavation of problem areas. “This will result in less disruption to airport operations,” up to the planned end of remedial work by 2019, it added. (MAH) said the adoption of grouting instead of slab replacement had also brought “a significant improvement in the incidence of sudden depression” at the airport.

September 2016: The Australian Transport Safety Bureau (ATSB) has confirmed that a large piece of airplane debris, found just off the coast of Tanzania in June, is from the Malaysia Airlines Boeing 777 that crashed in 2014 while operating as MH370.

“[The part] was the inboard section of a Boeing 777 right, outboard flap, originating from the (MAS) 777 (registered 9M-MRO),” the (ATSB) said in a September 15 update.

The flap section was found by locals on Pemba Island, just off the coast of Tanzania, Africa on June 20, 2016. It was initially identified from photos as an inboard section of a 777 outboard flap and, on arrival at the (ATSB), that preliminary identification was confirmed. “A date stamp associated with one of the part numbers indicated manufacture on January 23, 2002, which was consistent with the May 31, 2002 delivery date for (9M-MRO),” the ATSB said. “The Italian part manufacturer recovered build records for the numbers located on the part and confirmed that all of the numbers related to the same serial number outboard flap that was shipped to Boeing as line number 404. 777 line number 404 was delivered to (MAS) and registered as (9M-MRO).”

The (ATSB) will now study the part to see whether it can draw any conclusions about the state of the flap when it separated from the wing. “This information may contribute to an increased understanding of end-of-flight scenarios,” it said.

This is the fifth item (formally named Part Number 5) that the (ATSB) has confirmed as being from (or almost certainly from) the ill-fated flight, which went missing on March 8, 2014 en route from Kuala Lumpur to Beijing with 239 passengers and crew on board.

The four other items comprise a flap track fairing segment, a horizontal stabilizer panel segment, an engine cowling segment, and a panel segment from the main cabin associated with the Door R1 closet, which the (ATSB) concluded were “almost certainly” from the (MAS) 777. Part number 5 is the first item that the (ATSB) has definitively identified as being from MH370.

French air accident investigation agency (BEA) has also positively confirmed that a flaperon, found on Reunion Island on July 29, 2015, was from MH370.

In a September 14 update on the underwater search for MH370, the (ATSB) said >110,000 sq km of the southern Indian Ocean seafloor has been searched so far. The entire 120,000 sq km search area will be completed by around December 2016. “Ministers went to great lengths to explain that this does not mean the termination of the search. Should credible new information emerge that can be used to identify the specific location of the 777, consideration will be given to determining next steps,” it said.

October 2016: "Malaysia Airlines Finalizing A380 Religious Charter Operations" by (ATW) Kurt Hofmann hofmann.aviation@netway.at, October 21, 2016.

Malaysia Airlines (MAS) is completing a charter business concept to operate its 6 Airbus A380s in a dedicated subsidiary for religious pilgrimage traffic. The new charter operations would likely be put into a separate entity and could formally launch before December.

(MAS) (CEO) Peter Bellew met with Airbus management this week. “Airbus (EDS) can adapt the cabins within 4 to 6 weeks to accommodate 700 passengers in an all-economy (Y) class seating, including pray areas on board the A380, besides other features.”

Bellew expects there is enough demand on the new routes for up to 20 A380s to carry pilgrims from around the world to Mecca. “So far there is no name for [the subsidiary].” (MAS) had been trying to sell the A380s, but found a limited market. “Selling these aircraft was not successful and Bellew had to look for other options.”

The new subsidiary could likely launch in 2018 when (MAS)’ 1st Airbus A350-900 arrives in (4Q) 2018, which will replace the A380s.

(MAS)’s flagship route is Kuala Lumpur to London Heathrow and the A380 is so far the only aircraft in its fleet that can operate the sector nonstop. According to (MAS), only 2 A380s currently fly the London route. “We would also like to cooperate with other operators. The standalone business potentially is open to investment from manufacturers.”

Bellew is keen to talk to other A380 operators and partners, such as Rolls-Royce (RRC), he said. The business might also further tap aircraft coming off lease, such as from Singapore Airlines (SIA).

(MAS) has one of the world’s largest hangars at its home base at Kuala Lumpur International Airport, which can accommodate 2 A380s completely covered and a 3rd partially covered. (MAS) also has licenses to conduct full "C" checks on the aircraft. Fixed base and full-motion simulators at Kuala Lumpur and a full roster of A380 instructors are available.

The several-weeks-long Hajj and year-round Umrah pilgrimage will keep the A380s busy 8 months of the year, “which cover the annual costs of the aircraft.” Outside of the religious charter market, the A380s are available for wet lease when other wide body aircraft undergo maintenance checks that can take 3 or 4 months.

Saudi Arabia (SVA) is moving toward banning aircraft that are >20 years old from carrying religious pilgrims to Hajj and Umrah services, which creates more opportunity for the newer A380 to be used for such flights. 2 million passengers are on the move each year for the Hajj.

November 2016: News Item A-1: Malaysia Airlines (MAS) plans to increase China services by adding 8 new destinations and 11 new routes with 35 additional frequencies, beginning in early 2017. “(MAS) plans to triple our Chinese business over the next 5 years. I see a potential for direct flights to 20 Chinese cities from Kuala Lumpur, Penang, Kota Kinabalu and Kuching by 2019. We have huge confidence in China,” (MAS) (CEO) Peter Bellew said.

In addition to this initial growth, (MAS) will add seasonal or ad hoc services in key leisure markets such as Langkawi, Kuching and Kota Kinabalu. “6 of our new Chinese cities have never been served directly by a Malaysian airline,” he added.

The Oneworld (ONW) Alliance member’s new routes, starting from the (1H) 2017, will include 2x-weekly Kuala Lumpur (KUL) to Haikou (December 16); 3x-weekly (KUL) to Nanjing; 3x-weekly (KUL) to Fuzhou (April 17, 2017); 3x-weekly (KUL) to Wuhan; 3x-weekly Penang to Shenzhen; 4x-weekly Penang to Shanghai (August 17); 5x-weekly (KUL) to Chengdu and (KUL) to Chongqing (Ocober. 17) services. The starting date for 2x-weekly (KUL) to Tianjin services will be announced later.

On existing routes, (KUL) to Shanghai will become double daily from April 17, subject to slots. (MAS) recently announced it will switch out a Boeing 737 for an Airbus A330 on its (KUL) to Hong Kong sector.

News Item A-2: Malaysia Airlines (MAS) has confirmed plans to reconfigure and reassign its 6 Airbus A380s to a new carrier unit dedicated to transporting Hajj pilgrimage passengers. New (MAS) (CEO) Peter Bellew detailed the A380 plans on November 18 during a panel discussion in Manila at the Association of Asia Pacific Airlines (AAPA) 60th Assembly of Presidents. He said the A380s were “too big and thirsty” for (MAS)’ Kuala Lumpur - London Heathrow route and it was “too early yet for a 2nd-hand sales market” for the super jumbo.

Consequently, (MAS) has decided to create a separate carrier unit specializing in Hajj transport. The A380s will be reconfigured with 650 - 700 seats to give “very competitive seat costs,” Bellew said.

Ultimately, Bellew added, he believed there would be a “great opportunity for 2nd-hand A380s, not just the aircraft we have.” He said he thought of the A380 as more like a spaceship than an aircraft and said that when they began looking deep inside Malaysia Airlines (MAS)’ aircraft during "C"-check maintenance, he realized they were “put together in the most incredibly strong way and were showing no wear and tear. I think they will be like the [Boeing] 707 and still be flying in 40 or 50 years’ time,” he said.

Airbus (EDS) (COO) Customers John Leahy said he saw 2 different markets developing for the A380 (new and used). “My argument is that there are certain markets that will want new and some that will want used. Some of Emirates Airline (EAD) President Tim Clark’s used A380s create big marketing opportunities and I think you will see the market expanding into new operators,” Leahy said. Leahy retains his faith in the future of the A380, despite Airbus (EDS) having decided this year to cut the production rate from 2.5 to 1 aircraft per month in 2018. But Leahy said he believed a re-engined neo version ultimately would be built, pointing out that people “go out of their way to get on the airplane.”

News Item A-3: Airbus (EDS) announced its Malaysia-based industrial partners (CTRM) and Spirits Aerosystems have begun producing components for the 1st of 6 A350-900s for Malaysia Airlines (MAS). Powered by 2 Rolls-Royce (RRC) (Trent XWB) engines, (MAS)’s 6 new A350-900s will be acquired on lease from Aircraft Lease Corporation (ALE) and will be delivered between the 4th quarter of 2017 and the 2nd quarter of 2018.

News Item A-4: See video: "(MAS) 737-8H6."

January 2017: Australia, China and Malaysia have officially announced the end of the search for the missing Boeing 777-200ER that operated Malaysia Airlines (MAS) flight MH370, which crashed in March 2014. “Despite every effort using the best science available, cutting edge technology, as well as modeling and advice from highly skilled professionals who are the best in their field, unfortunately, the search has not been able to locate the airplane. Accordingly, the underwater search for MH370 has been suspended,” the countries said in a joint statement, adding that the last search vessel has now been stood down.

The 120,000 sq-km/46,300 sq m underwater search in the southern Indian Ocean was described by the authorities as “an unprecedented challenge.” The countries added the decision “has not been taken lightly nor without sadness,” but it was in keeping with the plan formed during a joint meeting in July 2016.

MH370 with 239 passengers and crew aboard veered from its planned course about 40 minutes after taking off from Kuala Lumpur bound for Beijing on March 8, 2014. There was no sign of the 777 until late July 2015, when a piece of airplane wing was discovered on Reunion Island in the Indian Ocean. The 777 airplane debris was later determined by specialists in France to be from MH370.

Since then, >20 pieces of the 777 have been found along the east and south coast of Africa, the east coast of Madagascar and the Indian Ocean islands of Mauritius, Reunion and Rodrigues. However, the underwater search of 120,000 sq km of seabed along a “7th arc” established by final satellite communications with the errant airplane, have not turned up any traces of the fuselage.

“Whilst combined scientific studies have continued to refine areas of probability, to date no new information has been discovered to determine the specific location of the airplane,” authorities from the 3 countries said. “We remain hopeful that new information will come to light and that at some point in the future the airplane will be located.”

Families of the victims, represented by the "Voice370" group, said they were “dismayed” to hear that the underwater search had been terminated. They said a new search area was recommended by the Australian Air Transport Safety Board (ATSB) on December 20, located 25,000 sq m north of the former area. “In our view, extending the search to the new area defined by the experts is an inescapable duty owed to the flying public,” Voice370 said. “Having already searched 120,000 sq kms, stopping at this stage is nothing short of irresponsible, and betrays a shocking lack of faith in the data, tools and recommendations of an array of official experts assembled by the authorities themselves. We appeal to Malaysia, China and Australia to reconsider the decision to suspend the search.”

The British Airline Pilots' Association (BALPA) also issued a response to the news. “It is disappointing but understandable that the search for MH370 has been suspended. Unfortunately this means that investigators will not be able to find out exactly what happened in order to prevent it happening again,” (BALPA) General Secretary, Brian Strutton said. “Today, we reiterate our call for more to be done to have sensible tracking of airplanes from take-off to landing. This could include technology such as ‘virtual black boxes’ where safety data can be transmitted when an airplane experiences problems so it can be located more quickly, as long as protections are put in place to regulate the use of that data.”

* "MH370 Becomes a Ghost Ship" by Karen Walker Karen.walker@penton.com in (ATW) Editor's Blog, January 17, 2017.

It’s a sad day in commercial aviation history with the confirmation that the search for MH370 has been suspended. The joint decision by the governments of Australia, China and Malaysia was inevitable and is understandable. It has been almost 3 years since the Malaysia Airlines Boeing 777-200ER disappeared. The unprecedented search effort has painstakingly scoured some 46,000 square miles of ocean; every technology, expert and resource available has been applied. Everyone, not least the families, friends and colleagues of the 238 people on board, wanted a different outcome and believed that the plane would be found.

All we have, however, is some 20 pieces of airplane debris and no real knowledge as to what happened to that airplane or why. The tragedy of that reality is that the families of the victims have no closure and the wider airline industry (an industry that is so good at learning from mistakes) has no definitive answers.

After Air France (AFA) flight 447 disappeared into the southern Atlantic in June 2009, there was talk about whether that aircraft, an Airbus A330, would ever be located and recovered. But almost 2 years later, the recovery effort did indeed find the aircraft and even located the data and voice recorders, which (remarkably) provided information crucial to determining why that aircraft crashed. It was a miraculous end to a tragedy and one that yielded answers that the industry could share and use to prevent a similar occurrence.

This will not be the case with MH370. Rumors and conspiracy theories will always be able to cloud the few facts that have been established. Books and movies will cash in on the open-ended what ifs? What must not be overlooked, however, is the enormous human and technological endeavor that was made to find MH370. Australia, in particular, has been exemplary in its search effort coordination, provision of manpower (in an often arduous and sometimes dangerous mission) and documentation.

MH370 did prompt the industry to re-examine its commercial airliner tracking protocols. The technology was essentially already there; this event was a wake-up call about the gaps (literally) that airlines fly through and the need to close them. That work must continue; it is simply not acceptable in this day and age for a modern airliner to be out of communication long enough that it can stray far from its flight plan, disappear, and controllers have little-to-no idea that something is amiss until it’s too late. That is something this industry can act on – and is.

But today, we should solemnly acknowledge that we have failed to establish the answers to the disappearance of a modern airliner that is an industry workhorse. We should all be haunted by the "ghost ship" that MH370 became today.

March 2017: Malaysia Airlines (MAS) said it finished last year ahead of its budgeted loss, with a “strong result” during the final quarter of 2016. (MAS), the Kuala Lumpur-based company said it is making steady progress on its turnaround plan and continues to seek out cost savings for the year ahead.

Malaysia Aviation Group Berhad does not release full financial statements, as it is not publicly traded, but said it finished 49% ahead of its budged loss under the business plan for fiscal year 2016.

(MAS) said it made a profit in December 2016 and that passenger load factor for (4Q) improved to 81%, up from 70% in (Q4) 2015. The Group said it achieved a 90% LF load factor for the final month of 2016.
“When you see 90% load factors in December, there is nothing wrong with our plan and the reputation of the company.”

Looking forward, the Group remains cautious for the outlook in 2017, where the weaker ringgit to the USA dollar, overcapacity and intense competition are expected to dominate. “In terms of competition, for example, Indonesian low-cost carrier (LCC) Lion Air will place a [whole lot of] 737 MAXs and A330s into the [Malaysian] market.”

Bellew is disappointed that delivery of the 1st of 6 Airbus A350 XWB aircraft is expected to be delayed by Airbus by 1 to 2 months to December 2017. “Which is a pity for us, because December is our busiest month of the year,” he said.

(MAS) may potentially seek additional wide body aircraft from either Airbus or Boeing for introduction in (1Q) 2018 to increase seats and improve product quality available on existing routes. “The [leasing] market has softened and lease rates are coming down,” Bellew said. “We have been offered 30 different wide body aircraft. This is an interesting opportunity and we may reduce narrow body aircraft, like-to-like, with wide bodies,” he said, adding (MAS) is considering leasing 6 wide body aircraft.

(MAS)’s Boeing 737 fleet operates with a 35-min turnaround time, effective October 27, 2016, for the new winter season. This will reduce the Group’s aircraft requirement by up to 4 737s in 2017.

Also, a decision for a future long-haul fleet could be made by the end of 2017. Bellew said the company is evaluating both the Airbus A330neo and Boeing 787-9 and the decision “depends on the right pricing.”

He said, “We have delivered a solid 2016, but a weak Malaysian ringgit, overcapacity in the Malaysian market and any potential price war will make 2017 a challenging year.” He expects yields to decline in the second half because of what he called “irrational competition, but our focus will be on reducing costs to maintain our financial position.” Bellew said the Group has identified a further RM400 million/$90 million of cost reductions in 2017 to offset USA dollar strength, which should be enough and must be not increased. “We are very focused on our business plan and are executing it well,” he said.

The Group continues to maintain strong year-on-year load factor performance and believes it will improve on targets for 2017, barring unexpected airfare declines as a result of overcapacity and intense competition. The Group projects it will carry >17 million passengers in 2017.

April 2017: Malaysia Airlines (MAS) has become the 1st customer to sign up for SITAONAIR, Aireon and FlightAware’s global flight tracking service, designed to prevent incidents similar to the disappearance of (MAS) MH370.

MH370 (a Boeing 777-200ER with 239 passengers and crew aboard) veered from its planned course about 40 minutes after taking off from Kuala Lumpur bound for Beijing on March 8, 2014. While some of the airplane structures have since been located, the majority of the airframe has still not been recovered. The search for the missing 777 ended in January this year. The MH370 disappearance has reinforced the need for continual flight tracking, triggering new (ICAO) rules for tracking airplanes.

Under the SITAONAIR agreement, Malaysia Airlines (MAS) will adopt the real-time alerting system, giving it minute-by-minute, space-based global tracking across its whole fleet. The system adds Aireon’s space-based Automatic Dependent Surveillance-Broadcast (ADS-B) data to FlightAware’s global air traffic control data, airplane datalink information and terrestrial (ADS-B) data. This space-based (ADS-B) data helps cover data gaps, particularly over oceanic and remote airspace, where there is currently no surveillance. The information is then delivered through to SITAONAIR’s AIRCOM FlightTracker.

“(MAS) will be at the cutting-edge of real-time flight tracking technology. With access to up-to-the-minute reporting, (MAS) will know the location, heading, speed and altitude of all airplanes in its fleet, at all times, and be alerted to any exceptions,” SITAONAIR AIRCOM Portfolio Director Paul Gibson said.

SITAONAIR added that no new avionics or modifications are needed to use the service; it will work for all (ADS-B) Out-equipped airplanes.
Aireon is expected to become operational in 2018, once the 66 satellites of the Iridium NEXT satellite constellation go live. Customers of SITAONAIR’s AIRCOM FlightTracker will automatically begin seeing the new Aireon data appear in their systems.

June 2017: News Item A-1: Malaysia Airlines Berhad (MAS) plans to convert 10 Boeing 737 MAX 8s it has on order to the new 737 MAX 10 version.

News Item A-2: Malaysia Airlines Berhad (MAS) still expects to receive its 1st A350 XWB by the end of this year, but is no longer planning to put the wide body on Kuala Lumpur to Auckland routes.

At the (IATA) (AGM) in Cancun, (MAS) (CEO) Peter Bellew said the 1st A350 was supposed to be delivered in October. But the aircraft has seen some delivery delays because of supply chain issues, particularly with seats and cabin equipment. Bellew joked that he still expected a 2017 delivery, but it would probably be “just as we pop the champagne at midnight on December 31.”

(MAS) will initially put the A350 on London routes. By the end of April, the plan is to have 4 A350s aircraft delivered and (MAS) will make a decision by end of June on new long-haul routes. Auckland was considered, but Emirates Airline (EAD) and Qatar Airways (QTA) now both operate to the New Zealand city. “Yields have gone to the dogs, so we are looking at Europe, the Middle East or Asia for the A350.”

Bellew noted that load factors on its London service (currently operated with the Airbus A380) consistently averaged 80% LF this May versus about 40% LF for the same month last year. “We lowered fares a bit, but we also did a sponsorship deal with [English soccer team] Liverpool FC,” he said. “We needed to make an impact on our international brand. Football (soccer) is very popular in Asia and Liverpool FC is the number 1 or number 2 supported team in Asia.”

The sponsorship, which Bellew said was “not as expensive as you’d think,” scrolls current fare prices in Thai, Mandarin and other languages around the soccer field during premium league games. Bellew said the uptake of those fares has been well worth the sponsorship.

August 2017: Malaysia Airlines Berhad (MAS) has seen a dramatic improvement on its Australasian services, thanks to (MAS)’ efforts to boost demand in this market. (MAS) was previously concerned about the performance of its flights to Australia and New Zealand, which are an important part of its overall network. After launching a commercial review, (MAS) decided to cut its flights to Darwin, Australia, from July 28. It still serves 4 routes to Australia and 1 to New Zealand.

September 2017: News item A-1: Malaysia Airlines (MAS) said it remains on track for returning to profitability next year, despite increasing competitive pressure in its domestic markets. In its latest update, (MAS) predicted it will achieve a net profit for the 2nd half of 2018. (MAS) does not issue full financial results, as it is no longer publicly traded. Overall passenger revenue increased +8% year-on-year in the 2nd quarter, with capacity rising +1.8%. Load factor declined -1.6 points to 77.8% LF.

News Item A-2: Malaysia Airlines (MAS) has signed a Memo of Understanding (MOU) with Boeing (TBC) to convert 8 existing orders for the 737 MAX series to wide body 787-9s. The agreement also takes an additional 8 purchase rights for 737 MAX 8s.

October 2017: News Item A-1: Malaysia Airlines (MAS) is considering launching new service to Europe using some of the Airbus A350s (MAS) is scheduled to receive next year. (MAS) is currently “in active negotiations” with 12 airports regarding potential new service, including 2 in Europe, an airline spokeswoman said. However, she cautioned that, “As of now, we have not got the right deal on costs and airport slots” on any of these new routes.

News Item A-2: "Bellew to Return to Ryanair as (COO) by (ATW) Editor Karen Walker karen.walker@penton.com October 17, 2017.

Current Malaysia Airlines (MAS) (COO) Michael Hickey is stepping down at the end of October after (RYR) was forced to make hundreds of cancellations, costing (RYR) millions of euros, because of crewing problems related to a government-mandated change in how it allocates vacation time. (RYR) is now offering pay increases and bonuses to pilots (FC) in a bid to prevent an (FC) shortage. (RYR) pilots (FC) have expressed their anger at the disruptions caused by the scheduling chaos and many are believed to be looking to join other airlines.

RYR) said on October 6 that Michael Hickey, would be stepping down. The current crisis arose after (RYR) failed to adequately prepare for a change in regulations that require it to squeeze 6 months of annual leave into its final quarter, prompting the scrapping of services for some 700,000 customers.

Malaysia Airlines (MAS) (CEO) and Group Managing Director Peter Bellew will leave his post in December to rejoin (RYR) as (COO). (RYR) announced the rehiring of Bellew, who worked at (RYR) until 2014 and was Flight Operations Director. He will join (RYR) in Dublin on December 1.

Bellew will take over responsibility for (RYR)’s Flight & Ground Operations & Engineering, but have specific responsibility for pilot (FC) production, training and career development. He will have “a mission to ensure the pilot (FC) rostering failure which (RYR) suffered in early September will never be repeated,” (RYR) said.

Bellew joined Malaysia Airlines (MAS) in August 2015 and became CEO in July, 2016, succeeding Christoph Mueller. “Peter has an unrivalled knowledge of our business model and how we maintain controlled growth, with industry leading punctuality, for the benefit of our customers and our people. Peter will lead a significant transformation in the way we reward and interact with our pilots (FC), improve their working environment and career development over the coming years,” (RYR) (CEO) Michael O’Leary said.

“I look forward to working with all the team and all the crews I know so well to further develop our growth to 600 airplanes over the next 6 years,” Bellew said.

News Item A-3: Malaysia Airlines (MAS) has named company veteran Izham Ismail as its next Group (CEO), accelerating (MAS)’ plan to have a Malaysian take over the top job after restructuring. Izham is currently (MAS)’ (COO). He has worked for (MAS) since 1979, when he joined the company as a pilot (FC). His selection as (MAS) head comes less than a week after the public disclosure that current (CEO) Peter Bellew would be leaving (MAS) to take a job and return to Ryanair (RYR).

November 2017: The Malaysian government has put its 737-700BBJ up for sale with a reserve price of MYR38 million ringgits/USD8.97 million.

737-700BBJ (M53-01) (397-29274, /99 9M-BBJ)) is an 18-year-old business jet airplane delivered to Malaysia Airlines (MAS) in November 1999. Featuring 31 seats, it is currently operated by the Royal Malaysian Air Force ((RMF), based at Kuala Lumpur Simpang) for (VIP) duties.

According to official documents, the tender is open to any company registered in Malaysia or individual citizen of Malaysia.

Bids are due by November 20.

Fleet:
(definitions)

Click below for photos:
MAS-737-800
MAS-737-800 - 2014-02
MAS-737-800 RETRO 2012-10
MAS-737-86N
MAS-737-8H6-2011-11
MAS-747 DATA
MAS-747-400 - 1970s Livery.jpg
MAS-747-4H6
MAS-747-4H6 9M-MPD
MAS-777
MAS-777 50 YRS
MAS-777-200
MAS-777-200ER-2014-03
MAS-777-2H6ER
MAS-A330
MAS-A330 - 2012-12
MAS-A330-200
MAS-A330-223
MAS-A330-223-A
MAS-A330-300 - 2016-11.jpg
MAS-A380
MAS-A380 - 2012-05
MAS-A380 - 2012-05-A
MAS-A380 - 2012-06
MAS-A380 - 2012-07-A
MAS-A380 - 2012-07-B
MAS-A380 - 2012-07-C
MAS-A380 - 2012-07-D
MAS-A380 - 2012-07-E
MAS-A380 - 2012-07-F
MAS-A380 - 2012-07-G
MAS-A380-NEW LIVERY - 2012-03
MAS-ATR72-600 MASWINGS - 2013-07

November 2017:

0 737-3H6C (CFM56-3C1) (2415-27125, /94, OPS FOR (FPO) 2000-09), 2 ST PETRAIR, SWITZERLAND.

0 737-4YO (CFM56-3), RTND.

1 737-4YO (CFM56-3) (24915, 9M-MQQ), OAKHILL CAPITAL LSD 2010-05, EX-(SX-BKL).

39 737-4H6 (CFM56-3C1) (2407-27085, 9M-MML; RF (ANE) 1999-12) (2542-26462, /93 9M-MQE; 2536-26461, /93 9Q-MQD), 2 ST (JPL), 2 LST (BRM), 27673; 27674; LST (MLT), 26455 RF (BRM) 2001-07. 16F, 128Y.

10 737-400 (CFM56-7), (AFD)/(ALC) LSD 2007-07.

1 737-430 (CFM56-3C1) (2316-27001, /92 9M-FZA), (CSL) LSD, TRANSFERRED TO FIREFLY (FFM) OPS 2011-01. 162Y.

0 737-5H6 (CFM56-3C1) (26445; 26446; 26448; 27356), RTND (GEH), LST (AFA).

0 737-5H6 (CFM56-3C1) (2503-26450, /93), RTND (GEF), LST (AFA) 2001-04.

1 737-7H6 (CFM56-7B) (397-29274, /99 9M-BBJ "MASTAR"), BBJ (VIP), PUT UP FOR SALE 2017-11, 31 SEATS.

5 ORDERS 737-700, LSD, WITH WINGLETS.

1 +2 ORDERS 737-800 (CFM56-8B), (AZV) LSD 2015-05. 186Y.

2 +2 ORDERS 737-800 (CFM56-7B), (GEF) LSD 2014-01, WITH WINGLETS. 186Y.

43 ORDERS 737-800 (CFM56-7B), WITH WINGLETS:

3 737-8FZ (CFM56-7B26) (3395-31779, /10 9M-MLG; 39319, 9M-MLJ; 39320, 9M-MLK), (BBB) LSD, EX-(N1787B). WITH WINGLETS. 16C, 150Y.

1 737-8FZ (CFM56-7B26) (3503-31793, /10 9M-MLI), WITH WINGLETS. 16C, 144Y.

1 737-8GQ (CFM56-7B26) (2428-35793, 9M-MLD), (AWW) LSD 2010-05. EX-(N793AW). 186Y.

8 737-8H6 (CFM56-7B26) (3421-40128, /10 9M-MXA - - SEE PHOTO - - "MAS-737-8H6-2010-11;" 3495-40130, /10 9N-MXC; 40133, 9M-MXF, 2011-10; 3911-40135, 9M-MXH, 2012-01; 40136, 9M-MXI, 2012-07; 40137, 9M-MXJ, 2012-08; 40147, 9M-MSE, 2013-06; 40148, 9M-MSF, 2013-07), WITH WINGLETS. 186Y.

2 737-8Q8 (CFM56-7B26) (1953-30702, 9M-MLB; 1964-30703, 9M-MLA) (ILF) 5 YR LSD 2009-01. 30702; & 30703; XFRD TO FIREFLY (FFM) OPS 2011-01 AS (9M-FFA & 9M-FFB). 186Y.

1 737-86N (CFM56-7B26) (285-28595, /99 OK-TVD), (TSF) WET-LSD 2005-10. WITH WINGLETS. 186Y.

1 737-86N (CFM56-7B26) (2250-32690, /07 9M-MLC), (GEF) LSD 2009-01. WITH WINGLETS. 16C, 150Y.

1 737-86Q (CFM56-7B26) (963-30278, /01 OK-TVC), (TSF) WET-LSD 2005-10. 186Y.

55/20 ORDERS 737-800/-900 (CFM56-7B), WITH WINGLETS:

8 ORDERS 737 MAX 8:

10 ORDERS 737 MAX 10:

3 747-2D7F (CF6-45) (424-21784, N524MC), (TLS) WET-LSD 1999-11, FOR (MKO) OPS. FREIGHTER.

2 747-236F (RB211-524D4) (502-22304, /81 9M-MHI "KUCHING;" 526-22442, /81 9M-MHJ "JOHOR BAHRU"), EX-(BAB), 22304 CONV TO F 1995-10. (MKO) OPS. FREIGHTER.

3 747-236F (RB211-524D4) (23711; 24088), EX-(BAB), (AID) 3-YR WET-LSD 2002-10. (MKO) OPS. FREIGHTER.

1 747-256F (699-24071, TF-ARW), (AID) WET-LSD. (MKO) OPS. FREIGHTER.

0 747-267B (RB211-524) (531-22530, TF-ABA), (EUK) WET-LST 2004-12. RTND. 12F, 32C, 412Y.

1 747-3H6 (JT9D-7R4G2) (650-23600, /86 9M-MHK), FOR SALE.

0 747-4H6C (CF6-80C2B1F) (745-24405, /89 9M-MHM "PENANG"), FOR SALE. LST PEACEAIR (PEA). 24F, 38C, 227Y/PLT.

00 747-4H6 (PW4056) (932-27042, /92 9M-MPA "IPOH;" 965-25699, /93 9M-MPB SPECIAL RED "AN EXPERIENCE REDEFINED;" 974-25700, /93 9M-MPC KUANTAN;" 997-25701, /93 9M-MPD SPECIAL RED "AN EXPERIENCE REDEFINED;" 999-25702, /93 9M-MPE "KANGAR;" 1017-27043, /94 9M-MPF "KOTA BHARU;" 1025-25703,/94 9M-MPG "KUALA TERENGGANU;" 1041-27044, /94 9M-MPH "LANGKAWI;" 1091-27672, /96 9M-MPI "TIOMAN;" 1130-28426, /97 9M-MPJ "LABUAN;" 1147-28427, /98 9M-MPK "JOHOR BAHRU;" 1150-28428, /98 9M-MPL "PENANG;" 1152-28435, /98 9M-MPM "MELAKA;" 1247-28432, /00 9M-MPN "PANGKOR;" 1290-28433, /01 9M-MPO "ALOR SETAR;" 1296-29900, /02 9M-MPP "PUTRAJAYA;" 1301-29901, /02 9M-MPQ "KUALA LUMPUR"). 25126 ST (QAN) 1998-07. 24315 ST (TBC) 2003-01. 24405 ST (TBC) 2003-05. 25700; ST (WLD) 2007-10. 25701; 27672; 28426; TO ALWAFEER AIRLINES (ALR) 2009-12. ALL TO BE RETIRED BY END OF FEBRUARY 2013. 13 IN STORAGE. 12F, 41C, 306Y.

2 747-4H6F (SCD) (PW4056) (1371-28434, /06 9M-MPR; 1374-29902, /06 9M-MPS), OPS FOR MASKARGO (MKO). FREIGHTER.

0 747-47UF (1165-29252), (TLS) WET-LSD 1999-11, FOR MASKARGO (MKO) OPS. RTND 2002-10. FREIGHTER.

0 767-316F (848-32573, N314LA), (LAN) WET-LSD 2001-10, RTND. MASKARGO (MKO) OPS. FREIGHTER.

14 777-2H6ER (TRENT 892B-17) (64-28408, /97 9M-MRA; 74-28409, /97 9M-MRB; 78-28410, /97 9M-MRC; 84-28411, /97 9M-MRD - - SEE ACCDT REPORT - 2014-07; 115-28412, /98 9M-MRE; 128-28413, /98 9M-MRF; 140-28414, /98 9M-MRG; 151-28415, /98 9M-MRH; 155-28416, /98 9M-MRI; 222-28417, /99 PM-MRJ; 231-28418, /99 9M-MRK; 329-29065, /01 9M-MRL; 336-29066, /01 9M-MRM; 394-28419, /02 9M-MRN; 404-28420, /02 9M-MRO; 496-28421, /04 9M-MRP; 498-28422, /04 9M-MRQ), LSD. 4 777-2H6ER LEASED TO AIR ZIMBABWE (ZMB) 2017-06. 35C, 247Y.

4 ORDERS 777-3H6:

8 ORDERS 787-9:

0 DC-10-30 (CF6-50C2) (234 ST (GHN) 1999-06) (228-46955, RTND (GRB), LST (DAR) 1999-05) (46959) LST (GHN) 1999-10; (46933) LST (GHN) 1999-12. 1 GRD, 46933; & 46959 RF (WLD).

1 MD-11F, (WLD) WET-LSD. MASKARGO (MKO) OPS. FREIGHTER.

0 A300B4-203, (147) RTND (GRB), LST (CXP) 2000-04.

45/17 ORDERS A319/A320/A321 (CFM56), TO REPLACE 737'S:

5 A330-223 (PW4168A) (255, 9M-MKU 2004-02; 262, 9M-MKT 2004-01; 290, /99 9M-MKX, 2003-02; 296, /99 9M-MKV; 300, /99 9M-MKW, 2003-02), EX-(SAB)/(VGZ) (ILF) 3 YR LSD. 42C, 187Y.

4 ORDERS (2011-10) A330-223F (PW4170A), FOR (MKO) OPS, FREIGHTER:

1 A330-243F (1332, 9M-MTI), EX-(F-WWTZ) 2012-08, FOR (MKO) OPS. FREIGHTER.

9 A330-322 (PW4168) (67, /95 9M-MKA; 119, /95 9M-MKJ), PENERBANGAN MALAYSIA BERHAD LSD. ALL FOR SALE. 68 W/O 2001-03. 44C, 250Y.

0 A330-322 (PW4168) (95, /95 9M-MKR 2004-05; 143, /96), EX-(SKB), (ILF) 3 YR LSD 2004-01. RTND. 31C, 330Y.

5 +10/10 ORDERS A330-323 (PW4170A) (1219, 9M-MTB, 2011-04; 1234, 9M-MTD, 2011-06; 1336, 9M-MTH, 2012-07; 1347, 9M-MTJ, 2012-09; 1431, 9M-MTM, 2013-07), EX-(F-WWYX, F-WWYN, F-WWTY, F-WWCM, & F-WWCN). 44C, 250Y.

10 ORDERS A340-500, TO REPLACE 747'S:

8 ORDERS A340-600, TO REPLACE 747'S:

4/2 ORDERS A340-861 (018, 9M-), 555 PAX:

6 ORDERS (2017-10) A350-900, AIR LEASE CORPORATION (ALE) LSD:

6 A380-841 (TRENT 970-84) (78, /12 9M-MNA; 81, /12 9M-MNB, 2012-07; 84, /12 9M-NMC; 89 /12 9M-NMD; 94, /13 9M-NME; 114, /13 9M-NMF), 8F, 66C, 420Y.

5 DHC-6-310 TWIN OTTERS (PT6A-27) (791 PARTED OUT 1999-02) (792, /82 9M-MDK; 529, /77 9M-MDZ). 19Y.

10 F 50 (PW125B) (20150, /89 9M-MGA; 20156, /89 9M-MGB; 20161, /89 9M-MGC; 20164, /89 9M-MGD; 20166, /89 9M-MGE; 20167, /89 9M-MGF; 20170, /89 9M-MGG; 20175, /90 9M-MGI; 20204, /90 9M-MGJ), 50Y.

10 +5 OPTIONS ATR 72-212A (856, 9M-MWB, 2009-03; 863, 9M-MWC, 2009-04; 873, 9M-MWD, 2009-05; 889, 9M-MWF, 2009-10; 895, 9M-MWG, 2009-11; 904, 9M-MWI, 2010-03; 910, 9M-MWJ, 2010-04), FOR MASWINGS OPS. 68Y.

12 +8 OPTIONS ATR 72-500 (ATR72-212A) (941, 9M-FYJ, 2011-01), FOR FIREFLY (FFM) REGIONAL OPS. 68Y:

1 +19/16 ORDERS ATR 72-600 FOR FIREFLY (FFM) REGIONAL OPS, 72Y.

16 ORDERS ATR 72-600 FOR MASWINGS REGIONAL OPS:

Management:
(definitions)

Click below for photos:
MAS-1-Izham Ismail - 2017-10.jpg

TAN SRI MD NOR YUSOF, CHAIRMAN.

TAN SRI BASHIR AHMAD ABDUL MAJID, CHAIRMAN NEW COMPANY'S CORPORATE RESKILLING CENTER (CRC) (2015-01).

IZHAM ISMAIL, GROUP CHIEF EXECUTIVE OFFICER (CEO).
Izham is an (MAS) veteran having worked for the company since 1979. He is leaving his latest (MAS) position as Chief Operations Officer (COO).

PETER BELLEW, CHIEF EXECUTIVE OFFICER (CEO) & GROUP MANAGING DIRECTOR EX-(RYR) (2016-07) RESIGNED (2017-10).
Peter has returned to RyanAir (RYR) as (RYR)'s Chief Operating Officer
(COO).

Interview: Peter Bellew, (CEO) & Group Managing Director Malaysia Airlines Berhad "A New Day" by Kurt Hofmann, ATWOnline, August 26, 2016.
KH: Peter Bellew became (CEO) and Group Managing Director of Malaysia Airlines Berhad (MAS) on July 1, 2016 succeeding Christoph Mueller. Peter had been (MAS)’s (COO) since August 2015, and previously was Director Flight Operations at Irish low-cost carrier (LCC) Ryanair (RYR). In 1 of Peter’s 1st acts as (CEO) Malaysia Airlines (MAS) an order for 25 Boeing 737 MAX 8 airplanes plus 25 purchase rights was announced.

The 737 MAX deal was the 1st major airplane order by (MAS) since the restructuring of (MAS) that took effect in September 2015.

KF: What does the order mean for the company?
PB: This deal was a game changer for (MAS). The 737 MAX delivers much lower costs and greater efficiency. 1st deliveries will start in 2019. Internally, this is very important for our employees. (MAS)’ future is now safe and secure. The new airplanes make that a reality for our employees. The restructuring of (MAS) has happened remarkably fast. We are moving forward and are nearing the completion of the transformation.

Regarding the 737 MAX, there are 2 important points: It is the right type of airplane for fleet replacement, offering more seats and more range than the 737-800. But the order will also give us flexibility with the existing fleet. As we determine the best speed to grow our business, we can either finish our 737-800 lease contracts or we can choose to extend them.

FH: Which routes will the 737 MAX operate?
PB: Growth over the next 5 years will be mainly within Asia: N Asia, China, S Korea, Taiwan, and Japan (our business is tremendous on those routes). This growth strategy remains on track with the Boeing (TBC) order. But the 737 MAX also opens up new destinations like Pakistan or India, plus additional China routes. The 737 MAX gives us at least an additional hour of flying time range with no payload sacrifice and more seats compared to the 737-800. This new airplane will set the stage for our continued recovery and success into the next decade. Our ambition for long-haul growth to Australia or Europe is very limited, which means competition from the Gulf carriers will not be a threat to us anymore.

KH: But the story of the Gulf carriers and (MAS) is not just about competition (now you cooperate with Emirates Airline (EAD).
PB: Malaysia Airlines (MAS)’ code share with (EAD) is an integral part of (MAS)’ future route strategy, helping to enhance connectivity with key priority markets. The strategic partnership offers customers a seamless international network, with both carriers currently placing their codes on the Kuala Lumpur - Dubai route, as well as on other routes under the agreement including Paris, Rome, Madrid, and Frankfurt. The code share is being implemented gradually throughout 2016 subject to regulatory approval. It will ultimately connect Malaysia to >90 destinations on the (EAD)’s network and allow (EAD)’s customers to gain access to (MAS)’ extensive Asia-Pacific network. The code share now covers 24 destinations and includes frequent flyer programs. (MAS) frequent flyer program members are able to earn and redeem miles whilst traveling with (EAD).

KH: How will your experience with Ryanair (RYR) influence your leadership of Malaysia Airlines (MAS)?
PB: Dealing with managing costs. I think the reduction of costs is the most helpful thing we can do for our long-term strategy. The other key lesson is that speed is essential. You have to do things quickly. Yield and revenue should grow fast. If you are making a mistake, change it quickly. Our load factors should increase from the 70% range to the 80% level in the next 12 to 18 months. Revenue should rise at least +7% points over the next few months. We have not been aggressive enough on the commercial side. The focus now is on selling seats.

KF: What about (LCC) competition in Asia?
PB: Scoot (SCT), AirAsia (ASW) and so on (we do compete with them, of course). But Malaysia Airlines (MAS) has a lot of loyalty program benefits besides attractive fares. Some (LCC)s offer low base fares, but the extra charges they have implemented are relatively high. With the 737 MAX, cost savings will be passed on to our customers through lower fares.

KH: Would you like to comment on MH17 and MH370?
PB: Regarding the crashes, they happened with the old company [pre-restructuring]. MH17 and MH370 aren’t affecting our current business, but they will never go away. It is part of the history of (MAS). But the morale of our employees has changed. Our image has improved. We have high punctuality with our flights. So (MAS) is boosted by good news. All of this is visible to our employees. (MAS) today is a new company, but with a heritage of 50 years.

KH: What about the future of your 6 Airbus A380s?
PB: The A380s will be phased out in 2018. The A380 is a complex aircraft to operate. We’ve found out that the best economic performance you can get out of it is on 7 or 8 hour long flight sectors, not on the 12 to 14 hours we do to London. The A380s will be replaced by 6 A350-900s, which will operate on the London route, with 1 A350 maybe flying to New Zealand or North Asia. The A350s are expected to be delivered from October 2017 through 2018. And if I could pick up some Airbus A330s with Pratt & Whitney (PRW) engines on the market, I would do it immediately. These aircraft offer low costs. We could add 3 or 4 A330s to our current fleet of 15 easily.

DATUK SERI MOHAMMED SHAZALLI RAMLI, NON-EXECUTIVE DIRECTOR (2015-01).

IGNATIUS ONG, MANAGING DIRECTOR & (CEO) FIREFLY (FFM).

DATUK CAPTAIN MOHAMMED NAWAWI BIN AWANG, (CEO) MASWINGS (nawawi@mas.com.my).

AZHA ABDUL JALIL, CHIEF FINANCIAL OFFICER (CFO) (2009-09).

PAUL SIMMONS, CHIEF COMMERCIAL OFFICER (CCO).

MOHD ROSLAN ISMAIL, SENIOR GENERAL MANAGER ENGINEERING & MAINTENANCE (HDQERMH) (mroslan@mas.com.my).

TAJUDEN BIN ABU BAKAR, SENIOR GENERAL MANAGER TECHNICAL/GROUND OPERATIONS (2001-06).

MS MARZIDA BINTI MOHAMMED NOOR, SENIOR GENERAL MANAGER INFORMATION TECHNOLOGY (IT) PLANNING & SERVICES (2001-06).

ONG JYH JONG, SENIOR GENERAL MANAGER CARGO OPERATIONS (2001-06).

PAUL AUGUSTUS MOONEY, SENIOR GENERAL MANAGER NETWORK/REVENUE MANAGEMENT.

AHMAD FUAD BIN MOHAMMED DAHLAN, SENIOR GENERAL MANAGER, MARKETING.

DUNCAN BUREAU, SENIOR VP SALES & DISTRIBUTION.

SHIHAJ ABDULLAKUTTY, SENIOR VP NETWORK & REVENUE MANAGEMENT.

RASHID KHAN, SENIOR COMMERCIAL DIRECTOR.

DR MOHAMADON ABDULLAH, SENIOR GENERAL MANAGER CORPORATE SERVICES.

GEORGE SNYDER, SENIOR TECHNICAL CONSULTANT, SAFETY & SECURITY, EX-(KAL)/(USA), (2007-08).

MARZIDA NOOR, CHIEF INFORMATION OFFICER (CIO).

CAPTAIN MOHD AZHARUDDIN OSMAN, GENERAL MANAGER FLIGHT OPERATIONS (OPERATIONS & DEVELOPMENT).

SHULHAMEED MARICAN, GENERAL MANAGER FLIGHT OPERATIONS (SERVICES & INFRA).

MS ZABARIAH IBRAHIM, GENERAL MANAGER CATERING SERVICES.

SHARI SULAIMAN, GENERAL MANAGER SALES & BUSINESS DEVELOPMENT.

NIZUYIR BUYONG, ASSISTANT GENERAL MANAGER SUPPORT SERVICES (2003-06).

WAN ABDUL RAHIM, ASSISTANT GENERAL MANAGER MAINTENANCE OPERATIONS (2003-06).

ISZHAM IDRIS, ASSISTANT GENERAL MANAGER MAINTENANCE SUPPORT (2003-06).

YUSOP JARIDI, ASSISTANT GENERAL MANAGER AIRPORT SERVICES (2003-06).

MS HAYATI DATO' ALI, ASSISTANT GENERAL MANAGER GROUND HANDLING MANAGEMENT (2003-06).

ABDULLAH MUDA, ASSISTANT GENERAL MANAGER FLIGHT MANAGEMENT (2003-06).

DR HUGH NOEL DUNLEAVY, COMMERCIAL DIRECTOR.

CAPTAIN MOHD SETH, CHIEF PILOT (TECHNICAL & DEVELOPMENT) (KULODMH) (tfaridah@mas.com.my).

CAPTAIN AHMAD ZURAIDI DAHLAN, CHIEF PILOT FLIGHT SAFETY & SECURITY
(zuraidi@mas.com.my) (KULOSMH).

CAPTAIN KAMARUDDIN KAMILIN, CHIEF PILOT (TRAINING & STANDARDS).

CAPTAIN KAMAL HISHAM, 747 FLEET MANAGER.

CAPTAIN NORUDIN ABDUL MAJID, 777 FLEET MANAGER.

CAPTAIN AZHANUDDIN SHAH AZMAN, 737 FLEET MANAGER.

KERNAIL SINGH, MANAGER ENGINEERING PLANNING (2003-06).

FUAD SHARUJI, MANAGER HEAVY MAINTENANCE (2001-06).

ZAIFUL HASMI HASHIM, MANAGER WORKSHOPS (2003-06).

ROBY HEAH, MANAGER AIRCRAFT PROJECTS (KULEIMH) (2001-06),
(robyheah@mas.com.my).

MAZLAN NORDIN, MANAGER PROGRAM OFFICE (2001-06).

RASHIDI SAIDIN, MANAGER TECHNICAL SERVICES.

JAMIL MD NOOR, MANAGER ENGINEERING TRAINING (2003-06).

WONG SIEW KIT, MANAGER MAINTENANCE OPERATIONS (2003-06).

MD NASIR ABDULLAH, MANAGER QUALITY ASSURANCE (QA).

MS SABINA ABDUL SAMAD, MANAGER ENGINEERING MATERIALS.

TAN WEE LIAM, MANAGER ADMINISTRATION & BUSINESS AFFAIRS (2003-06).

MOSES DEVANAYAGAM, MANAGER WARRANTY & CONTRACTS.

KALDIP SINGH, MANAGER INFORMATION SYSTEMS.

CHONG THIAM HEE, MAINTENANCE OPERATIONS MANAGER (MCC) (2003-06).

AMRAN ABDUL AZIZ, LEASE PLANNING MANAGER.

SAID SAYUTI, WORKSHOP PRODUCTION MANAGER (2003-06).

 
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