It’s going to be a long and rough road, with job cuts and service adjustments, but Malaysia Airlines’ CEO is promising to get the airline back on its successful feet again.
Christoph Mueller, the airline’s new Chief who is credited with transforming Ireland’s Aer Lingus into a transatlantic airline, admitted at a press conference yesterday that the airline is ‘technically bankrupt’.
This comes after the airline suffered two well-documented successive disasters – the disappearance of MH370 in March last year and MH17, which was shot down over Ukraine in July 2014.
In order to turn the business around, Mueller said the airline would receive a ‘hard reset’ or a 20 percent cut in expenditure through a major restructure to routes and job slashes.
Christoph Mueller has been tasked with turning the airline around.
As part of the restructure, the airline will cut around 6,000 jobs – reducing staff from 20,000 to around 14,000, The Australian reported.
The airline will also sell off buildings, planes, reduce the size of aircraft on select routes and cut frequencies.
Australia was singled out as one of the few destinations that is unlikely to see any changes.
This is in line with the success the carrier continues to have in the market and its ongoing investment such as the recruitment of local celebrity ambassadors Poh Ling Yeow and Nick Kyrgios.
“This is under construction but the Australian market is of such importance to us and to Malaysia, I do not expect major changes there.”
Christoph Mueller, Malaysia Airlines CEO
Mr Mueller added that despite upcoming adjustments, the airline will remain a full-service international carrier and will continue to operate regional and domestic operations.
He said the airline will seek partnerships with other airlines as a means of enhancing its long-haul network.
There will also be a company rebranding, however, he didn’t make it clear as to whether this includes name change.
With all the adjustments, Mr Mueller estimated that the airline could break even by 2018.
