MAS flying in reinforcements

KUALA LUMPUR: Malaysia Airlines Bhd (MAS) expects to finalise its plans to lease aircraft from a third party, most probably Italian national carrier Alitalia, within four weeks.

Its chief executive officer Peter Bellew told NST Business the national carrier was talking to several aircraft lessors and airlines worldwide on securing a leasing deal.

MAS is actively looking for aircraft to lease as part of its short-term plan to keep up with the rising demand of passenger travel while awaiting new plane deliveries.

“We expect a decision to go ahead or not go ahead in the next four weeks. We will only go ahead if we get the right financial deal,” he said in an email reply yesterday.

MAS is keeping its options open, although Bellew has expressed interest to lease up to eight wide-body Airbus A330-200 from financially-struggling Alitalia.

He said the Alitalia planes were recently refitted with a nice configuration of 20 business-class, 17 premium-economy and 219 economy seats.

“I would prefer 26-plus business (seats) but the current layout would be fine for regional use if the price was right,” said Bellew, adding that the A330s had a flight duration of up to 14 hours.

Any leases would quickly increase number of business-class seats as the demand for those seats on MAS flights was surprisingly high, he added.

Alitalia, which was declared bankrupt last month, is going through special administration proceedings, which could result in another bailout from the Italian government, a sale or a complete shutdown.

The airline operates 14 A330-200 aircraft, which are all leased from various lessors which include Castlelake Aviation, Apollo Aviation Group, Intrepid Aviation, Air Lease Corp, MD Aviation Capital, A.P.C Aircraft Purchase Co, Aergo Capital and its equity partner Etihad Airways.

Bellew said MAS had contact with all except two lessors involved, which he did not name.

However, Alitalia may survive another bankruptcy as Bellew said the airline could continue operations as a medium-long- haul carrier.

“I think now that Alitalia will survive as a long-haul medium- haul airline and will need these aircraft (A330-200) for the long term. I could be wrong, of course, but that is my opinion,” said Bellew.

Sources in the aviation industry said MAS was also talking to aircraft lessors and airlines from the Middle East as part of its options to secure planes for short-term.

“There are many grounded planes in the Middle East. Most of them belong to airlines that are based there.

“MAS could possibly get a good leasing deal from them,” said the sources.

Malaysia Airlines Bhd chief executive officer Peter Bellew says the airline will only go ahead with the aircraft leasing plan if it gets the right financial deal.

Although details of the discussions are kept secured, commercial aircraft leasing companies in the Middle East are growing to rival the likes of China-based aircraft lessors such as BOC Aviation.

But ultimately, Bellew said, MAS would be buying new planes in the next few years.

The national airline made a comeback last year after two unfortunate disasters involving Flight MH370 and MH17 in 2014.

Bellew said the MAS brand remained strong as passengers, travel agents and the public had returned to the airline after it worked tirelessly from last year to re-engage with them.

In the first quarter of this year, MAS’s overall load factor increased by 12.9 per cent year-on-year to 3.6 million passengers.

Source: New Straits Times | Business | 18 May 2017