>>> Financial woes at Malaysia Airlines
by Derek Yeo


ELATION TURNED TO gloom as Malaysia Airlines (MAS) braced itself for another record year of financial losses. Only days earlier, the 16th Annual Travel Awards 2005 in Pattaya, Thailand surveyed and voted MAS as the Best South-East Asian Airline.

Airline sources estimated that for financial year April 2005-March 2006, the company's losses could hit a staggering RM800 million to RM1 billion.

The airline suffered from years of mismanagement and lately, the impact of rising oil prices. In a bold management make-over, a new Chief Executive Officer - Mr Idris Jala - assumes office next month. The national carrier also has to fly loss-making routes into the vast interior of Sabah and Sarawak. It is cutting costs in yet another area - its large workforce; redundant lay-offs seem inevitable.

MAS has just published its revised fuel surcharges, effective from 15 Nov 2005, ranging from USD18 (RM 68) to USD50 (RM190). The revised rates do not affect domestic travel which remains heavily subsidised. For routes between West Malaysia and East Malaysia (Sabah and Sarawak), the surcharge is RM15; and for routes within Malaysia, RM7-50. Fuel surcharges are payable at the point of ticketing.

The airline has often groused about its role as Malaysia's national carrier to provide unprofitable domestic services, especially to poor rural regions.

Cost-plying grouses aside, fingers point to some lavish splurges by MAS at the same time. For example, experts - paid thousands of ringgit - were hired to advise on cost-slashing measures. One measure - carry less water and newspapers on flights - was introduced to lower aircraft weight.

The carrier's latest quarterly fiscal figures (July - September 2005) - in the red, no doubt - will be announced soon. Losses hit an all-time high of RM280 in the previous quarter.