The Strategist

Malaysia Airlines to Fold Up

06/01/2015 - 16:06

Airline Malaysia Airlines on Monday announced new plans to "full reset" the operation, with about 6 thousand workers to be laid off. It is expected that these measures will help the carrier to keep its business and stay in the market.

Channelsking - Oma teos
Channelsking - Oma teos
This project marks the first steps of the airlines’ new chief executive, Christoph Mueller, a German specialist, who in May 2014 was appointed for the position by Malaysian state fund Khazanah, which owns the airline.

As part of the plan to restructure the airline, job for only 14 thousand Employees will be provided. For comparison, at the moment, the company employs nearly 20 thousand workers.
However, the move was expected. State Fund, which owns the airline, last year said that about 6 thousand people will be laid off.

The restructuring of the airline under the guidance of Mueller is planned to start from September 1, which will result in rebranding aimed at improving the image of the airline affected by the disaster in 2014.

The aircraft Boeing 777-200, carrying out joint flight MH370 airlines Malaysia Airlines and China Southern Airlines from Kuala Lumpur to Beijing, disappeared in March 2014 off the coast of Malaysia. 239 persons were missed on board the plane. The reasons for the disappearance of "Boeing" has not yet been established.

Airliner Boeing 777, also related to Malaysia Airlines, flying from Amsterdam to Kuala Lumpur, was shot down in the sky over the south-east of Ukraine July 17, 2014. All the 298 people on the board, including 196 Dutch citizens, were killed.

These two tragedies were the last straw for the airlines, which already had been experiencing difficulties due to mismanagement long before.

A year ago, a government fund bought the company in hopes of saving the company and for this reason hired the acting now head of the Company Christoph Mueller.

The announced plan aims to stabilize the company in the next year and bring it to increase in 2017.
The company will focus on tasks such as optimization of the number of employees and routes.
In addition to reducing the workers, it expected that the company will deviate from low-profit long flights, such as flights to Europe within the framework of the optimization’s plan and focus on regional traffic instead.

Analysts have long pointed to the inept management of the company, as well as bad decisions, government intervention and unsatisfactory level of services, which greatly affected the image of the airline and therefore the results of its operations.

Last month Mueller wrote about the need for a major restructuring of the company in a letter to employees of airlines.



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