Firefly defers aircraft deliveries, sees soft market

SUBANG JAYA: Short-haul airline Firefly, which expects the passenger market to remain soft this year, has postponed its aircraft deliveries for this year as part of its consolidation plans.

Its CEO Ignatius Ong said it has taken delivery of eight aircraft out of the 20 aircraft that it purchased three years ago, and was supposed to take delivery of another one or two aircraft this year.

"At the moment we are consolidating so we have actually spoken to ATR, we are keeping what we have now, as it is. Whatever we have booked with them is postponed for the meantime," he told reporters at the prize giving ceremony of the "Fly Firefly & Be Rewarded" contest yesterday.

Firefly has 18 aircraft comprising ATR 72-500s and ATR 72-600s.

On whether it will resume aircraft deliveries next year, Ong said it will assess the market and decide in the fourth quarter of this year.

"We really need to see whether the market can sustain it. Don't forget, we also need to look at what is the capacity in the market. We are not the only one that is flying out from Subang or using the ATRs here.

"We also need to look at our competitors and make sure that there's no over-capacity. To be very frank, today there is over-capacity, whether it be out of Subang, or out of KLIA."

Ong said the airline began its consolidation exercise early this year, on the back of the soft market that started in mid-2015 and continued into the first half of 2016.

Ong said load factor was above 85% during the festive season and school holidays but since January, it has been ranging between 68% and 75%, with an average of 70%.

He said factors affecting demand include the weak ringgit and spending power of the public.

"Going back to where we have seen the market since mid-2015 until now, we are looking at not much growth until next year. This year we are actually in consolidation mode; whatever aircraft that we have, we are keeping the fleet size as it is. We are rejigging our network in terms of ensuring that the destinations that we fly to are what the public wants," he said.

He said Penang, Kota Bharu, Alor Setar, and Johor Bahru are key routes where it aims to increase frequencies. Firefly will not be adding any new destinations or cutting routes this year.

"It is really about sizing ourselves correctly, making sure that we don't take in too much if we can't," he added.

Due to soft demand, Ong expects passenger growth to be flat this year against the 2.3 million passengers it carried last year. It has so far carried 1.2 million passengers.

 

Source: The Sun Daily | Business  | 4 August 2016

LTSIP akan diperbesar bagi menampung 5 juta penumpang

Lapangan Terbang Sultan Ismail Petra (LTSIP), Kota Bharu, Kelantan.

KOTA BHARU: Terminal Lapangan Terbang Sultan Ismail Petra (LTSIP), Pengkalan Chepa di sini, akan diperbesarkan bagi menampung lima juta penumpang setahun.

Pengarah Urusan Malaysia Airports Holdings Berhad (Malaysia Airports) Datuk Badlisham Ghazali berkata pembesaran terminal itu sangat penting kerana bilangan penumpang sekarang lebih dua juta orang iaitu melebihi kapasitinya, 1.5 juta penumpang setahun.

"Setiap hari lebih kurang 70 kapal terbang berlepas dan mendarat di lapangan terbang ini, maka inilah masanya untuk membangunkan lagi lapangan terbang ini daripada kapasiti 1.5 juta orang penumpang kepada 5 juta orang penumpang," katanya kepada pemberita selepas majlis perasmian Program Sokongan Usahawan Desa (PSUD) di Min House Camp, Kubang Kerian di sini, Rabu.

Perasmian program itu dirasmikan oleh Pengerusi Malaysia Airports Tan Sri Dr Wan Abdul Aziz Wan Abdullah.

Badlisham ditanya perkembangan pelaksanaan projek pembesaran lapangan terbang itu yang telah diluluskan Kerajaan Persekutuan untuk dilaksanakan dalam Rancangan Malaysia Ke-11 (RMK11).

Beliau berkata pihaknya telah memohon peruntukan RM500 juta daripada Kerajaan Persekutuan bagi projek pembesaran lapangan terbang itu yang kini masih di peringkat perancangan.

Sementara itu, Malaysia Airports menyumbang RM10,000 kepada Min House Camp yang memfokuskan bidang agro pelancongan, bagi mengembangkan perusahaan madu kelulut yang dilihat berpotensi menarik ramai pelancong dalam dan luar negara ke Kelantan.

Peruntukan itu juga bagi membantu perkampungan itu mewujudkan kemudahan lain seperti ruang bacaan dan galeri untuk faedah pengunjung.

Wan Abdul Aziz berkata selain menyokong industri usahawan desa, pihaknya juga melaksanakan pelbagai program bagi menggalakkan sektor pelancongan.

Sumber: Bernama | 3 Ogos 2016

MITI sokong laluan penerbangan Kota Bharu - Bandar Raya Ho Chi Minh

Azran (empat kanan) bersama pengunjung yang hadir majlis Aidilfitri kelmarin.

KOTA BHARU: Kementerian Perdagangan Antarabangsa dan Industri (MITI) kini sedang giat mewujudkan jaringan perniagaan antara usahawan Kelantan dan Vietnam.

Pengarah MITI Kelantan dan Terengganu, Azran Deraman berkata, usaha itu terjalin selepas lawatan dua hari duta Vietnam ke Malaysia, Pham Cao Phong baru-baru ini ke Kelantan yang turut membuat lawatan ke Kawasan Bebas Cukai Rantau Panjang.

“Dalam lawatan ke kawasan bebas cukai, mereka mendapat taklimat daripada pihak kastam sebagi pengurus operasi, mereka melihat kawasan bebas cukai itu sebagai model untuk dilaksanakan di negara mereka.

“Kita turut mengadakan majlis makan malam yang menemukan pegawai kerajaan di samping memberi laluan kepada pihak usahawan untuk melihat potensi perniagaan di sana,” katanya kepada pemberita selepas Majlis Aidilfitri MITI di sini kelmarin.

Menurutnya, Vietnam merupakan satu daripada lokasi yang strategik kepada usahawan Kelantan kerana pelbagai faktor penarik termasuk geografi yang mampu membuka jalan kepada usahawan negeri ini.

Katanya, sebelum ini ramai rakyat Malaysia khususnya dari Kelantan berulang-alik ke Vietnam terutama yang menjalankan perniagaan pakaian mendapatkan stok dari negara itu.

Azran berkata, usaha itu ditambah dengan kajian pihak syarikat penerbangan termasuk negara yang dikatakan memberi perhatian untuk membuka laluan baharu dari Lapangan Terbang Sultan Ismail Petra ke Bandar Raya Ho Chi Minh.

Sehubungan dengan itu, beliau berkata, pihaknya akan mengambil inisiatif untuk berbincang dengan syarikat penerbangan seperti AirAsia dan Malindo Air supaya hasrat itu dapat direalisasikan dalam masa terdekat.

“Pihak Vietnam pun mengemukakan perkara yang sama, kita melihat peluang (pembukaan laluan) ini perlu dijayakan dalam masa terdekat, ia akan memperlihatkan satu perkembangan dari segi perdagangan pelancongan dan perniagaan,” katanya.

Menurutnya lagi, pihaknya telah mengadakan mesyuarat susulan dengan pihak Vietnam dan bersetuju untuk mengadakan satu taklimat khas kepada usahawan bagi meneroka pasaran di negara tersebut.

“Insya-Allah, satu taklimat bagi membuka peluang dan potensi antara Vietnam dan Kelantan, kita memanggil usahawan berpotensi termasuk dari Terengganu dan Pahang untuk melihat peluang, biar mereka cerita pertanian barangan halal atau sebagainya, kita mahu usahawan kita dapatkan maklumat secukupnya sebelum meneroka pasaran baru,” katanya. 

Sumber: Sinar Harian | Edisi Kelantan | 2 Ogos 2016

MITI Wilayah Kelantan & Terengganu cadang laluan Kota Bharu - Bandar Raya Ho Chi Minh

Wisma Perkeso di Jalan Kota Darul Naim, Kota Bharu yang menempatkan Pejabat MITI Wilayah Kelantan dan Terengganu.

KOTA BHARU: Pejabat Kementerian Perdagangan Antarabangsa dan Industri (MITI) Wilayah Kelantan dan Terengganu di Kota Bharu, Kelantan akan mengadakan perbincangan dengan syarikat penerbangan AirAsia dan Malindo Air bagi mewujudkan laluan penerbangan terus dari Kota Bharu ke Bandar Raya Ho Chi Minh.

Pengarahnya, Azran Deraman berkata laluan berkenaan amat sesuai kerana ramai rakyat Kelantan yang suka berkunjung ke Bandar Raya Ho Chi Minh dan Hanoi, Vietnam.

Ia juga merupakan salah satu peluang untuk memudahkan usahawan dari negeri Kelantan menerokai pasaran di Vietnam.

“Ia bukan sahaja dapat membantu usahawan di sini, malah langkah ini juga akan membantu merancakkan lagi sektor pelancongan di Kelantan,” katanya.

Tambah beliau, pihaknya akan mengadakan perbincangan dengan kerajaan negeri serta Kementerian Pelancongan dan Kebudayaan Malaysia Negeri Kelantan untuk mengenal pasti sektor pelancongan yang sesuai di sini.

“Apabila kita ke Vietnam, kita akan didedahkan dengan tempat-tempat pelancongan di sana. Oleh itu, kita juga perlu beri pendedahan kepada mereka mengenai keunikan negeri kita.” ujarnya.

“Kita boleh tonjolkan beberapa mercu tanda kita untuk merancakkan lagi sektor pelancongan di sini. Kita akan bekerjasama dengan pihak yang terlibat,” katanya.

Sumber: Kota Bharu Airport | www.kotabharuairport.blogspot.com | 1 Ogos 2016

Can Bellew fix MAS this time?

The new CEO needs to show tangible results to appease critics

THERE were doubts when Peter Bellew got the top job at Malaysia Airlines Bhd (MAS).

When his name topped the list as the candidate to take over from Christoph Mueller as the chief executive officer (CEO), many wondered if he was cut out for the job. Simply put, they felt his expertise was in the area of low-cost aviation and not in the premium segment, fearing that as the airline was being nursed back to health, it might regress.

The work Mueller had started was incomplete and more needed to be fixed. Branding and perception are still the biggest challenges.

MAS has gone through a roller-coaster ride over the past few years. Having reported years of losses due to a high cost base and not selling enough seats, its income was simply not enough to cover its cost.

After undertaking so many restructuring programmes to address its finances, none of them had worked. What pushed MAS into a tailspin was the two air disasters, unprecedented and shocking at the same time, in 2014, which made it very difficult for it to stay on course.

MAS’ problem, apart from cost, was that it was flying to places where the yields were not as attractive. It had too many employees and its issues were fundamental in nature, which without a clean-up, would have been near impossible to correct.

So, its parent, Khazanah Nasional Bhd, in a last-ditch effort, decided to start a new company to manage the airline. Along with that came 6,000 job cuts, finding out the real cost of buying and doing things, repricing fares and doing a lot more things that would, hopefully, make the airline resilient to be among its premium peers in the region and withstand the heat of the competition from low-cost carriers.

These tough decisions were not readily acceptable by many quarters.

What made things worse was the hiring of a foreigner to do the job. Mueller was picked and he did a lot of cleaning-up, with Bellew being hired to take care of the operations. To be fair, Mueller did manage to pull off the first phase of a near-impossible task, getting MAS back into the black in the first quarter of this year.

So, some positives have materialised from that choice, like the partnership with Emirates. But the old-timers in MAS would say that talks with Emirates for a partnership had started many years ago, but due to certain factors then, a deal was not fully-hatched.

‘We will fix it’

Today, Bellew is the man to watch. He is suddenly in the spotlight. But can he take MAS forward?

He famous tagline is “We will fix it”, somewhat similar to the children’s animated television series Bob the Builder’s tagline of “Can we fix it?”

Appointed on July 1 as CEO, he has done some interesting things at MAS.

Just before he became CEO, he was fond of walking about the KL International Airport in the morning to check on the day-to-day opeartions. Now, he is reaching out to employees in many different ways, be it at gatherings, at their work stations or on flights.

This interaction is highly important, as MAS employees have been through troubled times for too long and they need an assurance that this is the right man to turn the airline around. One thing that is good is that he is not making much changes to the turnaround plan, meaning that most of the initiatives will be seen through. However, we can expect some changes, as every CEO has his or her own way of doing things.

All this worker-interaction is a far cry from the once-upon-a-time “elite club or country club” of the senior team at MAS that was very much focused on the top level instead of reaching out to the staff at the shop level.

This week, Bellew appeared across global TV channels and newspapers as after many years, and with all the negative publicity that MAS has received, the airline placed orders for up to 50 new planes for a RM22bil (US$5.5bil).

The immediate reaction was whether MAS had fully-recovered to be committing itself to such big orders and whether it really had the load for the aircraft.

Bellew is not new to the industry and as Maybank Investment Bank Bhd senior analyst Mohshin Aziz puts it: “If he can work with Michael O’Leary, the boss of Ryanair for nearly two decades, then Bellew can withstand a lot, he knows what he is doing.”

Bellew is open in his approach and that is a contrast to Mueller, who preferred to work behind the public glare and was seen to be a bit “secretive”.

Nobody likes a secretive airline. On the first day of being appointed, Bellew had something to say to the press, which was rare for several of the past CEOs of MAS.

There is now more information flow on the airline, and in a way this is improving the battered branding of the airline. He is doing what Tan Sri Tony Fernandes does.

All these years, Fernandes has been the face of AirAsia Bhd. What he says ticks the market and he has a large following.This adds value to the airline.

Bellew is doing the same. He is giving facts that the market wants to know about MAS.

His recent statement that air passenger traffic from China is seeing recovery is a positive development for the airline, as it had been shunned by the Chinese tourists after the MH370 incident.

The purchase of 50 jets from Boeing also shows that MAS has hope of recovery in the regional markets, especially North Asia and China, and it is on a growth path to win more market shares.

He also has sent a clear message that there will be no more job cuts. His leadership is giving hope and direction to MAS.

And the one big thing Bellew is focusing on is for MAS to sell its tickets at prices that the market will respond to. He is going back to advertising the airline’s services and fares globally in a more coordinated manner.

The ongoing RM100 one-way promotion in conjunction with 100 years of Boeing’s existence for flights to Singapore, Jakarta, Medan and Phuket is attracting attention, as it has been a very long time since MAS has had such fares.

He continues to try and bring costs down with suppliers, as his training at Ryanair allows him to look at the finer cost details since cost management is a major component of airlines.

Bellew has 30 years of experience as a travel and air travel specialist, airport management and even managing legal disputes with pilots besides sales and marketing. While at Ryanair, he was in charge of pilots and the punctuality of the airline’s services.

This week, he also made a strong stand on the passenger service charge (PSC) being standardised across all airports in the country, be it premium or low-cost. He claims that the current fee structure is unreasonable.

KLIA 1 passengers pay RM65 per person in PSC for international flights as opposed to RM32 at KLIA 2.

He says: “Nowhere in the world is there such a different charge between two terminals which are 2km away from each other... it is completely nuts.”

While Bellew brings new hope to MAS – and he could very well be the best thing for MAS – all the promises he has made must be kept.

He has said numerous times that he would fix MAS, that it would be profitable by 2018. This week, he went a step further by committing March 2019 as the airline’s listing date.

It will also be four months ahead of the expiry of his three-year contract as CEO in July 2019.

All the changes at MAS may be good for the airline, but the small stunts are not going to change the minds of the sceptics. They need to see more tangible results.

So, the magic formula Bellew uses to show results will, perhaps, be a waiting game till 2019.

Source: The Star | Business | 30 July 2016

Malaysia Airlines, Boeing in US$5.5 billion deal to purchase 50 737 Max aircraft

Boeing and Malaysia Airlines Berhad (Malaysia Airlines) today inked a deal for 50 737 MAX aircraft worth US$2.75 billion. Shown here is a 737 MAX in the national carrier's livery. Pic: Courtesy of Boeing

PUTRAJAYA: Malaysia Airlines Bhd (Malaysia Airlines) and Boeing today inked a deal for 50 737 MAX aircraft with 25 firm orders and 25 purchase rights worth US$5.5 billion.

Malaysia Airlines Chief Executive Officer Peter Bellew said the deliveries would commence in 2019.

"The deal is a game-changer for Malaysia Airlines with much lower costs and greater efficiency, which we will pass on to our loyal customers with lower fares," he said in a statement.

Bellew said with the 737 MAX's longer range capabilities, Malaysia Airlines would be able to connect its passengers to more destinations in greater comfort.

The national carrier has operated almost every derivative of the 737 airplane family and took delivery of its 100th 737 aircraft in December 2014. Currently it operates 56 737-800s.

The signing ceremony between Malaysia Airlines and Boeing was witnessed by Transport Minister Datuk Seri Liow Tiong Lai and Malaysia Airlines' Chairman Tan Sri Md Nor Yusof.

Speaking to reporters later, Bellew said the new aircraft would reach a massive footprint in its short-haul route in Asia of up to five hours.

With the new aircraft, he said costs would go down by 40 per cent and operating expenses would ease by 15 per cent.

"I don't see any issue with getting the funding around these aircraft. They are very bankable assets," he added.

Bellew said the possible relisting of Malaysia Airlines on the stock market could take place by March 2019, depending on global market conditions.

Expressing his confidence that the national carrier will break even in 2018, he said: "We will be profitable by 2018. We have a lot of work to do in the next five quarters to make sure that Malaysia Airlines is back on track," he added.

Bellew also ruled out the possibility of adding the US to the carrier's route.

"The route is really expensive to operate and really expensive to lease and I see a lot of low hanging fruit all around the region rather than to fly to the States," he added.

Source: Bernama | Aviation | 27 July 2016

Malaysia Airlines orders 50 B737 MAX planes from Boeing

Boeing 737 MAX is a narrow body jetliner series as the successor to the Boeing 737 Next Generation series.

KUALA LUMPUR: Malaysia Airlines Bhd has ordered 50 B737 MAX aircraft from Boeing for US$5.5bil.

The planes, which are expected to be delivered from 2019, are to be used for the longer range flights.

“The purchase will be a game changer for the airlines,” said its new CEO Peter Bellew.

The Boeing 737 MAX is a narrow body jetliner series as the successor to the Boeing 737 Next Generation series.

 According to Boeing's website, the 737 MAX Efficiency delivers 8% lower operating costs than its main competitor while its advanced technology winglet increases fuel efficiency by 1.8% more. 

The new plane will also deliver better environmental performance while its superior fuel efficiency reduces carbon emissions.

The quieter 737 MAX also has a 40% smaller noise footprint than today's single-aisle airplanes. The purchase of these planes are part of the national carrier' plans to regain market share it has lost over recent years.

In a recent interview with StarBiz, he pointed out there will be no more staff and route cuts, instead there will be a period of refinement with lower fares for the Economy Class as the carrier tries to MAS will add six to seven new destinations next year, mostly flights into North Asia from KLIA2, Sabah and Sarawak, which will allow the airline to tap new segments of the market as it expands further into growth markets which are in the four-to-eight-hour flying radius.

“Most of the cost cutting is done, now it is about refinement. We have got better in our purchasing, handling cost is 50% lower, catering cost is 20% lower and fuel 5%-6% lower. It is getting much better. We need to be nimble and fly smarter,” he added.

MAS has cut 6,000 jobs and shrunk its network by 30%.

Source: The Star | Business | 27 July 2016