OdiE From United States of America, joined Jan 2001, 1641 posts, RR: 1 Reply 4, posted (11 years 3 weeks 6 days 10 hours ago) and read 2375 times:
I am afraid that BA's presence in Asia is actually shrinking. After suspending their services into Jakarta in 1999 and Kuala Lumpur in 2000, BA suspended its services into Manila and Taipei as well in 2002. In the Far East, BA only have flights to Tokyo-Narita, Beijing, Hong Kong, Bangkok and Singapore.
I still can't believe that BA would actually drop Kuala Lumpur in favor of Singapore, where it already have 2 daily flights when the flights were suspended. BA could do well on the LHR-KUL-Australia route. Now, MAS is the only option that we have to fly from London to Kuala Lumpur, but it's for the better. The only complain I have is it's really difficult to fly with MAS from London to Kuala Lumpur and people traveling from UK often need to book way in advance for the flights to Kuala Lumpur.
CPH-R From Denmark, joined May 2001, 5866 posts, RR: 3 Reply 7, posted (11 years 3 weeks 6 days 9 hours ago) and read 2314 times:
On the Shanghai route, they'll be facing some stiff competition from Virgin, who's been flying the route for a while now. On the other hand, if they do manage to get a Chinese partner into oneworld, it could be a very profitable route.
The Coachman From Australia, joined Apr 2001, 1415 posts, RR: 0 Reply 9, posted (11 years 3 weeks 6 days 7 hours ago) and read 2252 times:
If BA axed LHR-KUL-SYD, then it musn't have been doing well. They had both ends tied up, but unfortunately the airfares out of KUL have to be matched to MH's fixed government fares. The yields were appalling and therefore people flock to book seats because they were cheap. But it loses airlines money. BA couldn't take these cheap fares that are partly a Malaysian government problem, and MH has asked the government if they can increase fares.
BA can't do well until the Malaysian government gets rid of this stupid price ceiling that is far too low for the demand on the route.
OdiE From United States of America, joined Jan 2001, 1641 posts, RR: 1 Reply 10, posted (11 years 3 weeks 6 days 6 hours ago) and read 2233 times:
When BA used to operate into Kuala Lumpur (KL), BA was one of the more expensive carrier to fly from KL to London or Sydney. In fact, SIA was one of the cheapest carrier to fly ex-KL, but yet they are still making profit from Malaysia. In fact, MAS is one of the most expensive carrier to fly ex-KL. There was once where the fixed price agreement was suspended in the aftermath of the Sept. 11 tragedy, and all the airlines started to lower their prices and this had in fact increased the yields of some airline operating into Kuala Lumpur.
From London, MAS' fares are about the same as those offered by Thai, Virgin, SIA and Cathay while KLM, Austrian Airlines and Swiss are a bit more expensive than their Asian counterparts. Emirates, Sri Lankan Airlines, Qatar Airways and Gulf Air are among the cheapest to fly into Kuala Lumpur. In fact, BA do not face many competitions on the LHR-KUL route, other than MAS, but if you are considering Singapore, you have a whole lot of other airlines flying in there that are offering better bargain than BA. SAS, Lufthansa, KLM, Air France, Swiss, Emirates, Gulf Air, Sri Lankan, MAS, Cathay, Thai, Qantas competes with BA, although only Qantas and SIA offer a nonstop service.
KHI747 From United States of America, joined Oct 2000, 1613 posts, RR: 1 Reply 11, posted (11 years 3 weeks 5 days 23 hours ago) and read 2123 times:
Asia also includes the middle East and BA flies to every major city in the Arabian Gulf.
...... BA stopped flying to Karachi in 1991 after serving the route for many decades and it halted its Islamabad services last year.
Bells From Singapore, joined Nov 2001, 157 posts, RR: 0 Reply 14, posted (11 years 3 weeks 5 days 21 hours ago) and read 2062 times:
The Coachman is correct. Airlines including BA lost money hand over fist flying into KL because MAS wasn't being run as a proper commercial airline and was charging ridiculously low fares while simultaneously building up a debt of $2.5 billion.
The likes of BA, Qantas, Lufthansa, Northwest etc won't return to KL until MAS stops fare dumping.
BA lost $40 million on the KL route in the year before it suspended the service.
KLIA has waived all landing fees in an attempt to get more airlines to use the airport but they still aren't coming back.
Mas777 From United Kingdom, joined Jul 1999, 2926 posts, RR: 6 Reply 15, posted (11 years 3 weeks 5 days 21 hours ago) and read 2042 times:
My sources at BA tell me that KUL was actually doing rather well and cargo was an additional factor. BA was in fact about to alter its KUL flights from 5x week by 777, to 3x week with the 777 and twice weekly 747-400, with all flights operating point-to-point, as the 777 could not cope with demand on the route.
As mentioned many times before, QF was the frontrunner for ending BA's LHR-KUL-SYD route. This service actually operated at BA's peak performance into Malaysia and although QF code-shared on the route, it found it could not sell IT'S seats out of KUL, so abandoned the code-share and persuaded BA to concentrate in building up SIN as a joint hub instead. I also note that at this time, BA also handed over its Southeast Asian operations over to Qantas to manage, and we all know, since 1983, QF has not really been interested in operating into Malaysia - as it prefers to feed passengers via Singapore instead.
About fare-dumping, SQ fare-dumps in Malaysia, just check out their website and the ridiculous fares it offers out of Malaysia. OdIE is also correct about the fixed-fare structure in Malaysia. When the system was suspended following 9/11, fares went into freefall and airlines did BETTER. Emirates, Qatar, Lauda and Cathay Pacific could attest to that - as all four increased flights to cope with demand.
Incidently, these 'fixed-fares' are NOT fixed by the Malaysian government, but by the MEMBER airlines subscribing to them, of which BA and Lufthansa were major players.
OdiE From United States of America, joined Jan 2001, 1641 posts, RR: 1 Reply 17, posted (11 years 3 weeks 5 days 8 hours ago) and read 1871 times:
BA was actually experiencing pretty high load factors for their flight to/from KUL, so much so that it was complementing MAS' twice daily services last time rather than competing head to head (i.e. when either carrier was booked up, passengers will resort to the other carrier).
I don't see why BA made a loss at KUL when their European counterparts are making profits out from KUL. Austrian Airlines, for example, had increased their flights from 5 weekly to a daily flight to KUL, when other airlines are cutting down on their frequencies. O&D traffic between Malaysia and England is definitely a lot higher than between Malaysia and Austria, probably by several folds. If BA can market their product properly, I don't see why BA won't make profit at KUL.
In fact, KLM is getting good loads on their KUL flight, especially on their Business Class. Even Austrian seems to enjoy good loads for their Business Class. And the reason BA cited to pull out from KUL was lack of premium traffic on that route. Perhaps, all these passengers transfered to these airlines (KLM and Austrian) when BA pulled out. And that's lack of premium traffic, huh? Even MAS have no problems filling their Business or First Class to/from London.
The Coachman: Actually Mas777 just reminded me something. Any airline that operate into Malaysia, or rather, have presence in Malaysia, is NOT required to join the marketing agreement scheme. It's optional. SIA is not a member of the marketing agreement and they are doing very well in Malaysia because their fares are cheaper than the rest. The only setback is a travel agent can't sell SIA seats if they are selling tickets for MAS or other airlines that are in the agreement. However, now that there are numerous travel agencies that actually cater for SIA only, the airlines can consider whether to join that scheme or not. If they don't, they could market their flights with SIA or other travel agencies that carry SIA. You could see that United, Northwest and American are actually already doing so. They are offering passengers from KUL very cheap tickets to America because they are not involved in that agreement and hence, they are able to market it on their own.
Power From Hungary, joined Jul 2002, 123 posts, RR: 0 Reply 21, posted (11 years 3 weeks 5 days 1 hour ago) and read 1776 times:
Fact I flew BA out of KUL just before the route was suspended I have never seen business class so full. Fact II KLM makes a loss on the KUL route and will probably go from 5 flights a week to 4 for on the summer schedule.
Lauda (OS) makes its money on the flight from Sydney to Vienna it only uses KUL out of the simple fact that it is the cheapest place to stop and refuel on the way to Australia. 70% of OS passengers are Eastern Europeans going and returning from Australia.
Mhz From United Arab Emirates, joined Apr 2002, 92 posts, RR: 0 Reply 22, posted (11 years 3 weeks 4 days 23 hours ago) and read 1755 times:
Comparing Greenland and KUL is like comparing apples to oranges.
SAS-Greenland Domestic flight (i think coz it is part of Denmark)
BA-KUL International Intercontinental flight
KUL requires long haul and wide body aircraft, Greenland narrow body aircraft.
KUL initial ROI (return on investment) is riskier and payback return is longer
Malaysia population 22 million, Greenland 57,000 so market penetration? u be the judge.
For me why BA did not make money in KUL when others do is purely bad route management and they were late to capitalize the situation when the ringgit was grossly devalued with the USD & GBP.
Mas777 From United Kingdom, joined Jul 1999, 2926 posts, RR: 6 Reply 23, posted (11 years 3 weeks 2 days 13 hours ago) and read 1626 times:
Something that has always played at the back of my mind ever since the Bali bombing when the UK govt. admitted to having prior knowledge that Indonesia was a high-risk travel area but was not officially notifying the travelling public...
Did BA and NWA really pull out of Malaysia (and indeed Jakarta) due to the threat of being targetted by terrorists? We know that the US govt. warned American citizens against travel to Malaysia and issued warnings to US installations and companies. Is this the barrier between NWA and MAS cooperating more closely?
Did the British govt. issue similar warnings to BA about flying to Malaysia and hence BA took the stance to concentrate services at SIN which is generally regarded as 'safer' in terms of 'risks'?
Lufthansa pulled out of KUL due to economic reasons (and curiously no one has ever doubted that fact) - but it did so way back in 1998 - right after the economic crisis and consolidated its operations with STAR partners, Thai and SIA.
BA however, was flying high in Malaysia and (as I mentioned) didn't seem to be reporting many problems (in fact quite the opposite, according to my sources) - which I guess is possibly why many (especially, us frequent LHR-KUL flyers) find really difficult to accept. Reports of financial losses at KUL are still unconfirmed (I'm afraid I have checked with friends at BA Waterside).
Think about it - free landing rights and landing fees - you can charge peanuts and still make a profit. Emirates and Qatar are a testament to that.
I would be interested to see if there was more than financial reasons for airlines overflying KUL in favour of SIN in our current political and economic climate.