Malaysia Airlines Getting an Overhaul, New CEO

26th May 2015

There is a glimmer of hope for the loss-making Malaysia Airlines as the airline is looking for a complete overhaul and is being reorganized as a new company. The rebranding will be unveiled in the week to follow.

A New Name and a New CEO

Changes are planned not just for its fleet, but the entire network strategy of the carrier. There will even be a new name and livery, according to sources.

The new Chief Executive Officer Christoph Mueller, who joined Malaysia Airlines from Aer Lingus, Ireland said in his very first interview since taking the reins that the new company will be like a “startup”.

I’m hired to run the new company entirely on commercial terms and there’s very little margin for error. It’s not a continuation of the old company in a new disguise, everything is new.

The new company is expected to start operating by September, and the sole shareholder of MAS, Khazanah Nasional Berhard, has appointed Dato Mohammad Fais Azmi as the MAS Administrator effective 25 May.

Asmi will be responsible for the transfer of Malaysian Airlines assets and liabilities to a new company.

Job Cuts Didn’t Work, Maybe Selling Planes Will

In the past, MAS tried to keep afloat by cutting some jobs, which didn’t go so well with the unions. As a result, the management and the union had its disagreements in the last year or two.

Government interventions, interfering in the day-to-day operations and awarding commercial contracts to those with stronger political connections didn’t help MAS either.

As a result of all of this, as well as two catastrophic accidents in 2014 with the disappearance of MH370 and the shooting down of MH17, MAS has been suffering damage both financially and to its brand image.

One short-term solution for MAS’ troubles is certainly to sell some of its planes. The carrier is doing exactly that by putting its two Airbus A380s for sale, which was confirmed by Mueller.

Finally, the CEO of Malaysia Airlines remains optimistic, despite the troubles that are plaguing the airline:

We are not without our weapons. It’s doable, and it depends on the vigor in which we pursue the cost reduction.