The days of MAS as legacy airline are over, says Tee Keat

The days of having a legacy airline for Malaysia are over and the restructured Malaysia Airlines (MAS) should from now operate strictly as a business entity, former Transport Minister Tan Sri Ong Tee Keat said today.

He said although some segment of the country's population might still be sentimental about MAS being a legacy national carrier, sentiment had no place in present day realities of harsh competition in the aviation industry.

"We simply can't afford to have such an age old mindset of keeping MAS as a legacy airline but rather we should make it a commercial entity, to compete aggressively in the commercial world, with a profit-oriented emphasis," he told Bernama.

He said this when asked about his hopes for the new company that took over the airline from Sept 1, Malaysia Airlines Bhd (MAB).

"I think that is crucial. It all depends on whether we are prepared to go for the 'kill' in the market.

"If at all we want to keep it as it was, then of course that is an entirely different story altogether and certainly, is going to be very tough to make it sustainable against the prevailing backdrop," he said.

Ong pointed out that a legacy carrier would require the government to fork out large subsidies as was done in the past to keep MAS afloat and "that is none other than the public money", adding, Malaysia just could no longer afford to keep doing this.

"The new MAS should no longer be viewed as a legacy carrier but instead be commercially driven, like some other airlines in the region, such as Japan Airlines and even Garuda in Indonesia. Legacy airlines belong to the past and not in this 21st century," said Ong.

Ong said the terrain ahead for the new MAS was getting more and more challenging with the onset of the implementation of the ASEAN Open Sky Policy as agreed upon by member states in 2009 when he was Transport Minister.

"Given such a scenario, certainly, I would anticipate the new MAS with a new management team and new strategies would be able to be competitive in such a new market scenario.

"Certainly, having gone through such a huge restructuring exercise we have seen how determined they are in downsizing the workforce and giving the pledge to reshape the work culture with new marketing under the stewardship of Christoph Mueller," he added.

Ong was confident that all these would put the fresh entity on a firmer footing, having unloaded a lot of "excess baggage" of the past.

But he also cautioned that this was not a guarantee for success.

"You might have a fantastic and well thought of plan in every aspect. But, at end of the day, you need to have the determination to implement the said plan, or policies, not just by the top executive, but also by the entire workforce. I think that is crucial. It is still premature for anyone to say this is going to be successful or otherwise."

On another issue, Ong said the ditching of non-profitable routes should not solely be based on the profit and loss records of the old MAS.

"Instead, a comparative study of the old MAS vis-à-vis its competitor airlines flying the same routes should be taken into consideration, as that might serve as a good yardstick for such a drastic move as ditching air

routes.

"If you were to strip all the air routes without going through such details, the likelihood is that we might be sacrificing some that are difficult for the authorities to bargain for.

"We worked hard in the past to bargain with the respective authorities abroad to gain those landing rights," he added.

Ong explained that landing rights are not something that should be foregone readily or abandoned just like that.

"On the contrary, new air route perhaps should also be explored prudently so as to gain wider access to more destinations. This is necessary to be given due significance or the agenda to make the new MAS viable, if not profitable," he said.

Asked about the loss of some 6,000 jobs under the airline's downsizing plan, Ong said: "I am adamant that such an exercise is absolutely necessary, though painful and at the same time, should be conducted across the abroad, which MAS has done."

He also spoke of the new management's plan to reshape the work culture in MAS, describing it as a real litmus test to the new team, given the notion that "old habits die hard".

"You need to have new blood to reshape the new culture. But on the other hand, you need to strike the right balance in dealing with the existing pool of workforce.

"This pool of workforce must be made to understand that their future is intertwined with the entire entity. If there is a bright future for the new MAS, then their positions will be much more secure in the new entity and vice versa," he said.

Ong also said he senses that the new management was yearning for zero political interference in the running of the airline moving forward.

"Let us see how determined we are now in turning the national carrier around without any political interference," he added.