britannia191a
Posts: 229
Joined: Tue Nov 02, 2004 2:31 am

Malaysia Airlines Cuts 6,500 Jobs

Tue Mar 28, 2006 7:58 pm

BBC news has reported that 6500 jobs will be cut as part of their efforts to turnaround the airline. This would explain the route cut at Manchester I recently read.

The domestic area is being heavily dominated by Air Asia.

http://news.bbc.co.uk/1/hi/business/4851856.stm
 
kappel
Posts: 1836
Joined: Thu Jul 14, 2005 6:48 pm

RE: Malaysia Airlines Cuts 6,500 Jobs

Tue Mar 28, 2006 8:03 pm

Holy smoke, that's huge!! I didn't know they were going from 96 to 19 domestic routes... amazing. It almost make those cuts by US carriers pale in comaprison. Have they found taker for the aircraft they will be getting rid of (744 and 734)? How many employees does MAS currently have?
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LifelinerOne
Posts: 1497
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RE: Malaysia Airlines Cuts 6,500 Jobs

Tue Mar 28, 2006 9:15 pm

Is Malaysia owned by the government? How are the government going to make sure remote places in Malaysia will still be accessible? Or is Air Asia becoming the new domestic airline?

Cheers!  wave 
Only Those Who Sleep Don't Make Mistakes
 
Lumberton
Posts: 4176
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RE: Malaysia Airlines Cuts 6,500 Jobs

Tue Mar 28, 2006 9:18 pm

While I laud the carrier's attempts to return to profitability, this won't be easy at all. The layoffs are sure to bring job actions, maybe a strike. Will the government of Malaysia let the carrier have a "free hand" to restructure when the press goes decidedly negative? The local press is bound to spin this as "gutting" the national carrier. This is just the start of a long, ugly process for MH.
"When all is said and done, more will be said than done".
 
kappel
Posts: 1836
Joined: Thu Jul 14, 2005 6:48 pm

RE: Malaysia Airlines Cuts 6,500 Jobs

Tue Mar 28, 2006 9:28 pm

Quoting LifelinerOne (Reply 2):
Is Malaysia owned by the government? How are the government going to make sure remote places in Malaysia will still be accessible? Or is Air Asia becoming the new domestic airline?

All your questions are answered in the article, in short: yes by 69%, Air Asia, yes, even though MH will keep 19 domestic routes.
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cloudyapple
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RE: Malaysia Airlines Cuts 6,500 Jobs

Wed Mar 29, 2006 1:46 am

So cutting the domestics effectively means they are probably going to replace their B737s with about 10 new aircraft instead of 100.
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kappel
Posts: 1836
Joined: Thu Jul 14, 2005 6:48 pm

RE: Malaysia Airlines Cuts 6,500 Jobs

Wed Mar 29, 2006 1:48 am

Quoting Cloudyapple (Reply 5):
So cutting the domestics effectively means they are probably going to replace their B737s with about 10 new aircraft instead of 100.

If at all. They have postponed the replacement numerous times.
L1011,733,734,73G,738,743,744,752,763,772,77W,DC855,DC863,DC930,DC950,MD11,MD88,306,319,320,321,343,346,ARJ85,CR7,E195
 
lapper
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Joined: Fri Mar 15, 2002 6:42 am

RE: Malaysia Airlines Cuts 6,500 Jobs

Wed Mar 29, 2006 1:53 am

I hope this worls for them. I remember years ago GF had to go through a massive route reduction as they were losing money too. They seem to have turned things around. I hope MH does too. I flew them 2 years ago, fantastic carrier.
 
Econojetter
Posts: 356
Joined: Thu May 24, 2001 11:24 pm

RE: Malaysia Airlines Cuts 6,500 Jobs

Wed Mar 29, 2006 2:09 am

Reported in the Malaysian Business Times:

http://www.btimes.com.my/Current_New.../20060328011131/Article/index_html

My understanding of the decision on the Malaysian domestic air routes is as follows (contains additional info from news sources other than the above link):

- Govt decision on the rationalisation of the domestic air routes; the new plan may start to take effect by Aug 1
- Under the new plan, Malaysia Airlines (MH) will serve 19 domestic trunk routes; AirAsia (AK) will also compete on these routes
- In addition, AK gets to serve 96 secondary domestic routes
- Neither MH nor AK will receive govt subsidies for the abovementioned routes once the new plan is in full effect; currently, the profit/loss responsibility for MH's domestic operations is fully borne by the govt
- Separately, the rural air routes will be opd by AK under govt subsidy; these are most probably the DHC6 Twin Otter services and a small handful of F50 routes
- There will be some form of interlining between AK and MH to ensure connectivity, e.g. from AK-only stations to MH-operated international flights
- MH will not be allowed to charge fares below the full economy fare level on the 19 domestic trunk routes (hmmm... interesting, I wonder how they will determine the level); other than that, MH and AK will have full control over pricing, choice of equipment, frequencies etc.
- AK will sign a service contract with MH's maintenance/engineering dept
- AK may absorb some of MH's fleet and staff
- MH plans to offer some sort of voluntary separation scheme to 6500 employees; it is still unclear who will be footing that bill. I have read reports hinting that the govt will bear that cost along with some other costs associated with the transition of MH's domestic operations to the new plan
 
Lufthansa747
Posts: 2953
Joined: Tue May 18, 1999 7:45 am

RE: Malaysia Airlines Cuts 6,500 Jobs

Wed Mar 29, 2006 3:51 am

Quoting Econojetter (Reply 8):
MH will not be allowed to charge fares below the full economy fare level on the 19 domestic trunk routes (hmmm... interesting, I wonder how they will determine the level)

Hahaha, I guess no more MYR 80 MH flights KUL-JHB.

Not that I would have taken that ever again consirering the dickheads at Singapore immigration. (Cost was a fraction of a direct KUL-SIN)
Air Asia Super Elite, Cebu Pacific Titanium
 
kulatict
Posts: 107
Joined: Sun Mar 27, 2005 9:20 am

RE: Malaysia Airlines Cuts 6,500 Jobs

Wed Mar 29, 2006 9:55 am

Thank GOD!!!!!.. it's about freaking time MH really do something about the unnecessary personnel & unprofitable routes... although one could be sorry for those got lay-off but i'm sure the government will compensate them in one way or another... the other day as i was reading the local Chinese newspaper, the head of the 'labour-union' threatened industrial action if there's any job reduction at MH.... i guess eliminating excess unproductive workers are the way to resotre profitability... i mean MH has way more staff than CX & SQ but at the fraction of the competitors' capacity...
 
malaysia
Posts: 2615
Joined: Wed Nov 03, 1999 3:26 am

RE: Malaysia Airlines Cuts 6,500 Jobs

Wed Mar 29, 2006 10:12 am

Well we just let go our temp workers at the Sales offices in the US 2 weeks ago. May close all offices except New york and Los Angeles in the USA
There Are Those Who Believe That There May Yet Be Other Airlines Who Even Now Fight To Survive Beyond The Heavens
 
terryb99
Posts: 163
Joined: Sat Sep 04, 2004 3:35 am

RE: Malaysia Airlines Cuts 6,500 Jobs

Wed Mar 29, 2006 4:57 pm

From ATW;

http://www.atwonline.com/news/story.html?storyID=4524

When I was in Malaysia last year, my local rep was telling me of the employment laws there. The native Malays have a "protected" status. Maybe a local could help explain this better. How will 6500 layoffs occur under that kind of system?


Terry
 
Econojetter
Posts: 356
Joined: Thu May 24, 2001 11:24 pm

RE: Malaysia Airlines Cuts 6,500 Jobs

Thu Mar 30, 2006 2:42 am

Quoting Terryb99 (Reply 12):
When I was in Malaysia last year, my local rep was telling me of the employment laws there. The native Malays have a "protected" status. Maybe a local could help explain this better. How will 6500 layoffs occur under that kind of system?

The government is predominantly Malay. The decision on the domestic routes was made by the government. The airline (MAS) is also government-owned; its CEO was selected by the government. The government has decided now that it cannot sustain MAS at this rate and will not allow it to fail. So if the CEO declares that the airline will run into the ground soon unless the workforce is reduced, it is likely that the government will back the decision. I guess redundant employees will be offered a separation payoff and suspect that most of this will be paid for by the government. I wonder if we will ever know how much it cost to get 6500 employees to leave.

As long as the government backs the CEO's decision, the employees/unions (Malay or not) have little say. I found it interesting that ATWonline had a brief report earlier this week about industrial action brewing at MAS. I think all we will see are some angry words and perhaps even a couple of aircraft with cut wires. In Malaysia, one simply does not face off with the government in the open.

More details here in reports from The Star (Malaysian daily):

http://thestar.com.my/news/story.asp...nation/13805471&sec=nation&focus=1

http://thestar.com.my/news/story.asp...nation/13805471&sec=nation&focus=1

http://biz.thestar.com.my/news/story.../29/business/13805161&sec=business

The last link contains statements from the CEOs of both airlines at the joint press conference. The MAS CEO also comments on some other developments at the airline.
 
Devilfish
Posts: 5182
Joined: Tue Jan 24, 2006 7:52 am

RE: Malaysia Airlines Cuts 6,500 Jobs

Thu Mar 30, 2006 4:03 am

Perhaps the Indian carriers actively recruiting staff could take in those people who would not be absorbed by Air Asia? This could be a win-win situation, except those who would be laid-off might not want to be based abroad.
"Everyone is entitled to my opinion." - Garfield
 
MAS777
Posts: 2757
Joined: Sun Jul 11, 1999 7:40 am

RE: Malaysia Airlines Cuts 6,500 Jobs

Thu Mar 30, 2006 8:54 am

Quoting Kulatict (Reply 10):
it's about freaking time MH really do something about the unnecessary personnel

This is a major problem with MAS - will the culling of 6,500 employees actually help to solve any of its problems or will it mean its highly skilled staff be lost whilst leaving much 'deadwood' behind to continue running the airline to the ground?

Quoting Terryb99 (Reply 12):
How will 6500 layoffs occur under that kind of system

who knows - see other replies posted...

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