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LAXintl
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Malaysian Ends US Service - Drops LAX

Mon Jan 27, 2014 6:23 pm

The longhaul trimming continues at MAS....


Malaysian CEO says the carrier is dropping its sole remaining US link on April 30th in effort to stem ongoing losses and refocus on Asian region.

Per the carrier Los Angeles route suffered from lower yields due to high market competition and the continued high fuel cost made the 777 operation "no longer economically viable".

MH will continue to offer links to the US through oneworld codeshare partners AA and JL via other Asian and European gateways.


Story:
http://www.thestar.com.my/Business/B...ghts-to-Los-Angeles-focus-on-Asia/

=

Frankly I think this should have happened years ago, but now atleast with entry into OW, MH has gained more comprehensive options to utilize its partners to provide a US link.
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commavia
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RE: Malaysian Ends US Service - Drops LAX

Mon Jan 27, 2014 7:06 pm

What happened to the other thread where this was already being discussed?
 
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mercure1
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RE: Malaysian Ends US Service - Drops LAX

Mon Jan 27, 2014 7:15 pm

I assumed LAX remained as a political route for MH all these years. I recall CEO many years ago when NYC was dropped saying Americas region was loss making but carrier still needed to provide a link to such important market.


Makes on wonder what really future of MH is?
Seems longhaul (like TG), MH is mostly chasing after discount clients while intra-regional its being heavily attacked by hometown LCC Air Asia.
mercure f-wtcc
 
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LAXintl
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RE: Malaysian Ends US Service - Drops LAX

Mon Jan 27, 2014 7:24 pm

I think its been an open secret that LAX has been a struggle for MH. Between frequency, gauge and routing adjustments tweaks have continued.

In one of the OW entry treads I said the best thing that could happen was commercial realities rule and the route was axed (I feel similarly with TG and could see them drop LAX as well).

I view MAS as the bigger yet poorer cousin of neighboring and once sister company SIA. What SIA tries, so does MAS. However MAS keeps forgetting it has a vastly different market profile and cant go on sustaining multi-continent network adventures as its cousin can.
From the desert to the sea, to all of Southern California
 
LondonCity
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RE: Malaysian Ends US Service - Drops LAX

Mon Jan 27, 2014 7:30 pm

Quoting LAXintl (Reply 3):
However MAS keeps forgetting it has a vastly different market profile and cant go on sustaining multi-continent network adventures as its cousin can.

It also doesn't have the clever marketing skills of its Singaporean neighbour. I can't help but thinking the Gulf carriers, who are expanding into California, are or have already syphoned off transfer passengers from the likes of TG and MH. For example, a traveller based in India who previously might have flown via BKK or KUL now has good links via the Gulf.
 
a380787
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RE: Malaysian Ends US Service - Drops LAX

Mon Jan 27, 2014 7:40 pm

Quoting LAXintl (Reply 3):
What SIA tries, so does MAS. However MAS keeps forgetting it has a vastly different market profile

Plus the major unspoken benefit of SQ - Indonesia ... SQ is to Indonesia the way EK is to India, and SQ fills a large chunk of their F/J cabins by wealthy Indonesian businessmen, a type of feed that MH lacks.

It also lacks the huge tourism of TG/BKK to fill the back of the bus
 
The777Man
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RE: Malaysian Ends US Service - Drops LAX

Mon Jan 27, 2014 7:40 pm

Too bad that MH will stop flying to LAX. I had some great flights with them LAX-NRT and NRT-KUL this past September.

Sad to see another carrier leaving LAX.

The777Man
Boeing 777s flown: UA, TG, KE, BA, CX, NH, JD, JL, CZ, SQ, EK, NG, CO, AF, SV, KU, DL, AA, MH, OZ, CA, MS, SU, LY, RG, PE, AZ, KL, VN, PK, EY, NZ, AM, BR, AC, DT, UU, OS, AI, 9W, KQ, QR, VA, JJ, ET, TK, PR, BG, T5, CI, MU and LX.. Further to fly.. LH 777
 
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IrishAyes
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RE: Malaysian Ends US Service - Drops LAX

Mon Jan 27, 2014 9:18 pm

Some more light on the situation....apparently, MH didn't even codeshare with AA on its LAX routes.

http://upgrd.com/aerospace/malaysia-...s-cancels-los-angeles-flights.html

Quoting LAXintl (Reply 3):
In one of the OW entry treads I said the best thing that could happen was commercial realities rule and the route was axed (I feel similarly with TG and could see them drop LAX as well).

I feel the same way. I cannot see how TG is making a profit at LAX, even with a 1-stop to ICN, being less than daily. However, LAXICN is less saturated than LAXTYO.

Quoting LAXintl (Reply 3):
I view MAS as the bigger yet poorer cousin of neighboring and once sister company SIA. What SIA tries, so does MAS. However MAS keeps forgetting it has a vastly different market profile and cant go on sustaining multi-continent network adventures as its cousin can.

  

Quoting LondonCity (Reply 4):
I can't help but thinking the Gulf carriers, who are expanding into California, are or have already syphoned off transfer passengers from the likes of TG and MH.

Indeed. With the growth in ME carriers at LAX -- EK adding the A380, and EY and SV starting later this year, all of those represent competitors to SE Asia from Southern California.
 
laca773
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RE: Malaysian Ends US Service - Drops LAX

Mon Jan 27, 2014 11:04 pm

It seems MH is having a hard time finding itself in today's changing market scene. I'm still surprised they still have the A380s. Just seems to be such too much a/c for the markets they serve.
Still disappointing to seem them leave.
 
HB-IWC
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RE: Malaysian Ends US Service - Drops LAX

Mon Jan 27, 2014 11:36 pm

Quoting LAXintl (Thread starter):
The longhaul trimming continues at MAS....

I think FRA and/or IST can't be far behind.
 
spud757
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 1:43 am

Quoting a380787 (Reply 5):
Plus the major unspoken benefit of SQ - Indonesia ... SQ is to Indonesia the way EK is to India, and SQ fills a large chunk of their F/J cabins by wealthy Indonesian businessmen, a type of feed that MH lacks.

Why is this? Geographically there's not much between flying via SIN or via KUL.
MH has routes into Indonesia and has a decent premium cabin product. Does SQ have superior coverage of Indonesia in combination with it's subsiduary MI? Or does SQ just offer a superior service to the premium customer?

Quoting HB-IWC (Reply 9):
I think FRA and/or IST can't be far behind.

For these routes perhaps MH needs to develop codeshare relationships with OW partners BA / AY and QR.
 
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LAXintl
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 1:59 am

Quoting HB-IWC (Reply 9):
I think FRA and/or IST can't be far behind.

Yes I could see IST being dropped.

TK after only venturing back to KUL last summer is seeing strong demand and just announced it will be daily by end of April.

Also Malaysia announced its lifting visa requirements as part of a proposed Free Trade pact with Turkey, so you will see even more Turks utilizing the route, obviously opting first for the added TK flights.


This continues to go to highlight the bigger struggle MH has in its long haul network.
From the desert to the sea, to all of Southern California
 
airpearl
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 2:28 am

Quoting spud757 (Reply 10):
Why is this? Geographically there's not much between flying via SIN or via KUL.
MH has routes into Indonesia and has a decent premium cabin product. Does SQ have superior coverage of Indonesia in combination with it's subsiduary MI? Or does SQ just offer a superior service to the premium customer?

The whole SQ/SIN package is far superior to that of MH/KUL in almost all respects. Not only does SQ market itself better, it offers a consistency and quality that MH cannot hope to match. MH currently wins passengers by undercutting its regional peers, but that's not really a sustainable proposition - and it continues to bleed red ink as a result. If both carriers were to charge the same fare, a decision to fly SQ is a no-brainer for most passengers in the know, irrespective of the class of service flown.
 
TreeHillRavens
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 3:02 am

Quoting spud757 (Reply 10):
MH has routes into Indonesia and has a decent premium cabin product.

MAS Jakarta flight is regularly slapped with the leased non-BSI, non-standard B737-800 fitted with only overhead screen. Besides, MAS premium cabin just can't be compared with SIA's, which is far better than what MAS has unfortunately.
 
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LAXintl
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 3:05 am

Someone PM'd me asking about O&D statistics of KUL vs SIN demand from the US.

I figured it might be interesting to post this openly.

SIN Daily O&D
LAX - 385
NYC - 308
SFO - 256
HOU - 101
CHI - 65
DC - 53
SEA - 45

KUL Daily O&D
LAX - 104
NYC - 72
SFO - 43
HOU - 26
DC - 19
CHI - 15
SEA - 10


As you can see the respective home markets are quite different in size with Malaysia demand being a fraction of what Singapore generates.

Quoting airpearl (Reply 12):
MH currently wins passengers by undercutting its regional peers, but that's not really a sustainable proposition

  

I have consistently noted MH offers quite discounted fares especially in premium classes compared to SQ which virtually never discounts.

Another sign the LAX flight probably was not doing too well, I noted since joining OW, AA tended to have quite open award availability on MH in business class.
From the desert to the sea, to all of Southern California
 
CaliAtenza
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 3:06 am

Quoting airpearl (Reply 12):
The whole SQ/SIN package is far superior to that of MH/KUL in almost all respects. Not only does SQ market itself better, it offers a consistency and quality that MH cannot hope to match. MH currently wins passengers by undercutting its regional peers, but that's not really a sustainable proposition - and it continues to bleed red ink as a result. If both carriers were to charge the same fare, a decision to fly SQ is a no-brainer for most passengers in the know, irrespective of the class of service flown.

yeah, now the SQ is. But in the heydey of MH at LAX, one could argue the soft product was equal, and MH may have been better in some cases. They both flew 747s, their Y products were pretty much the same; although maybe SQ had a better Biz and First than MH. MH was usually cheaper as well.

Its sad though, i had a lot of great expierences on MH. I'll never forget the time when travelling as an entire family, we missed our first ever flight all traveling together from KUL-LAX. My dad literally stomped all over KLIA lol. Loved the catering, the flight attendants, the whole expierence. I even got to fly the Hibscus livery 747 twice, to LAX and back again to India going through KUL. I knew after EK showed up in LAX, they were done for though. To be honest i became much more loyal to EK and CX, but i'll always have a special fondness for MH. I am really surprised that service didnt end earlier but it had to happen any day now.
 
spud757
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 3:21 am

Quoting airpearl (Reply 12):

Perhaps in the premium cabins. However from a Y pax perspective, having travelled various routes on both MH and SQ I haven't seen much difference. The Y cabin comfort and service were comparable. So I guess it must be more to do with SQs F/J product and *A membership.

Could MHs fortunes start to change now it is in an alliance; opening up its network through global OW marketing and tapping into OW loyal FFs? I know I booked my next trip from the UK to USM on MH because MH is in OW. I could have booked on TG or SQ for not much difference in ticket price, and on EY for less, but OW is my preferred alliance if possible so MH got my business. Perhaps MH might start to see the OW effect in markets like Indonesia.

As for the USA - will we see MH working more closely with AA/BA/AY/QR via LHR/HEL/DOH to the east coast and AA/JL via Japan to West Coast?
 
warren747sp
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 3:26 am

And now they will make money with the A380. I doubt it very much another airline with no possibility of profits flying the whale jet!
747SP
 
a380787
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 4:33 am

Quoting spud757 (Reply 16):

Could MHs fortunes start to change now it is in an alliance; opening up its network through global OW marketing and tapping into OW loyal FFs? I know I booked my next trip from the UK to USM on MH because MH is in OW. I could have booked on TG or SQ for not much difference in ticket price, and on EY for less, but OW is my preferred alliance if possible so MH got my business. Perhaps MH might start to see the OW effect in markets like Indonesia.

As for the USA - will we see MH working more closely with AA/BA/AY/QR via LHR/HEL/DOH to the east coast and AA/JL via Japan to West Coast?

Even if you're loyal to oneworld, any particular reason to pick MH over BA/CX/JL for your Asian travel ? Other than the A380, the MH J product is really uncompetitive (on the level of TG and TP)
 
MAS777
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 5:14 am

Quoting laca773 (Reply 8):
Quoting a380787 (Reply 18):

Quite frankly yes.. I travel frequently between the UK and Southeast Asia and MAS' a380 service is fantastic and i have yet to see it short of full at any time of the year. Arrived yesterday and there were probably 2 or 3 seats empty on the whole aircraft and that is not that unusual. BA is pants for Southeast Asia despite me being an Exec Club member - flights to Singapore just arrive too late for connections for me and Bangkok leaves too early on the way back. CX is just too far north so involves dog-legging back to Southeast Asia. JL is a nonstarter for Europeans travelling to this region. Curiously i looked at QR and there are no decent connections ex-LHR for KL - almost every flight combination would have seen me wait at Doha for 6 or 8, some 15 hours enroute.. Why on earth would i want to do that??

And yes.. What happened to the other thread - i had posted that MAS is to expand their codeshare with American Airlines for all routes to the USA - which can only be a good thing and a win-win for both carriers.

I see this as a great step taken by an airline who is taking full advantage of its Oneworld membership.
 
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mercure1
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 5:55 am

Quoting warren747sp (Reply 17):
And now they will make money with the A380. I doubt it very much another airline with no possibility of profits flying the whale jet!

   I see the A380 is a trophy plane for folks like MH & TG, much like the 747 was a trophy plane for many airlines in the early 1970s.

The decision to order them probably went something like this between the airline CEO and some government minister.

Minister: Hello MAS CEO, what can you tell me about this new A380 airplane?
CEO: Yes minister its a fine aircraft. The largest in the world.
Minister: Is it true that SIA ordered two dozen of them?
CEO: That is correct sir
Minister: As pride of the nation, don't you think you could use some also?
CEO: I'll get right on it sir.

Quoting MAS777 (Reply 19):
Arrived yesterday and there were probably 2 or 3 seats empty on the whole aircraft and that is not that unusual.

And at what rates? From what I see from Europe, MAS tends to be one of the cheaper options possible.

As airlines have proven over and over, its often not an issue filing a plane. The difficulty is doing it profitably.   
mercure f-wtcc
 
infinit
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 6:42 am

MH and SQ were once one airline and like some here have pointed out, I think MH has always been using SQ as a benchmark to match but both airlines now serve different market profiles.

I wonder how the MH group is doing these days now that they've diversified with airlines like Firefly which I heard are performing well.

LAX will see less kebaya-clad stewardesses now as SQ too cancelled their LAX non-stop in December! With GA on the cards to join Skyteam, is there a chance GA would replace some of the kebaya-deficit there in time to come?  
 
airpearl
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 8:15 am

Quoting spud757 (Reply 16):
Could MHs fortunes start to change now it is in an alliance; opening up its network through global OW marketing and tapping into OW loyal FFs?

OW can help but I think MH needs more than that for a fortune reversal. Also it's a double-edged sword: MH may be getting more OW passengers but it could lose its loyal customers to other OW carriers too. And the newest OW members - QR and UL from Mar 1 - will probably dilute the membership benefit in higher passenger numbers that would have accrued to MH.

Quoting CaliAtenza (Reply 15):
Its sad though, i had a lot of great expierences on MH.

Yes, sadly many of these experiences are framed in the past tense for MH. While its inflight service is generally fine, the overall product is not really that of a first tier Asian carrier nowadays. As an airline, it has pretty much lost focus in my view - not truly capitalizing on its strengths and failing to address its weaknesses - staying static may have been just manageable in a regulated environment 10-15 years ago, but not in today's dynamic marketplace with the ME3 and new LCCs.
 
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LAXintl
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 8:24 am

Quoting mercure1 (Reply 20):
Minister: Hello MAS CEO, what can you tell me about this new A380 airplane?
CEO: Yes minister its a fine aircraft. The largest in the world.
Minister: Is it true that SIA ordered two dozen of them?
CEO: That is correct sir
Minister: As pride of the nation, don't you think you could use some also?
CEO: I'll get right on it sir.

  and the CEO knows he would be replaced in the heart beat if he did not listen to his government bosses.

Quoting infinit (Reply 21):
wonder how the MH group is doing these days now that they've diversified with airlines like Firefly which I heard are performing well.

Their last financial results in Q3 was a higher than expected loss (US$117m) inspite of growth in enplanements and revenues. Company said yields continued to be under pressure and it saw loss in market share along with weakness in ringgit currency. The CEO said the carrier would need to continue on its drive to reduce cost.
From the desert to the sea, to all of Southern California
 
tommy1808
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 9:35 am

Quoting mercure1 (Reply 20):
I see the A380 is a trophy plane for folks like MH & TG, much like the 747 was a trophy plane for many airlines in the early 1970s.

Actually MH is happy enough with its A380, in fact so happy that they considered buying a few extra A380 in order to aid the turnover out of the loss making zone. The A380 of MH have an LF von 80+% compared to the 78% they have fleet wide -> http://www.bloomberg.com/news/2013-0...aid-turnaround-southeast-asia.html

But i guess the bias around here is that you can not make money on the A380.......

Best regards
Thomas
Well, there is prophecy in the bible after all: 2 Timothy 3:1-6
 
rutankrd
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 9:49 am

Quoting tommy1808 (Reply 24):
Actually MH is happy enough with its A380, in fact so happy that they considered buying a few extra A380 in order to aid the turnover out of the loss making zone. The A380 of MH have an LF von 80+% compared to the 78% they have fleet wide -> http://www.bloomberg.com/news/2013-0...aid-turnaround-southeast-asia.html

But i guess the bias around here is that you can not make money on the A380.......

Best regards
Thomas

MAS are one of DORIC's target customers.

Whilst in the realm of very low level research MAS may be considering re-establishing the route to New York via a European point at the moment.

Transit points could be Stockholm (again), Manchester (Route suspended due to their financial crisis - Airport however ill prepared to handle transit traffic) or Brussels (Replacing Jet - who are moving to Amsterdam under the Etihad tutelage)

No timeframe and indeed decisions expected any time soon.
 
chrisrad
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 12:00 pm

Another point to add, MH fell behind in their cabin product many many years ago. Their last cabin upgrade of the 777 fleet commenced in 2005/6. Over 8 years ago. Sloping lie flat seats might have been great back then, even SQ still had the old purple sloping lie flats on their fleet. However every airline has updated their seats to a proper lie flat seat in that time, whilst MH has done absolutely nothing to remain with the competition, the A380 being the only exception. Even on the new A330's which they now send to all of Australia, instead of taking the opportunity to install newer seats. They again put in sloping lie flats! The only thing MH have going for them, is I still find the cabin crew to be warmer than SQ and the business class catering I still find better than SQ. I also prefer to connect through KUL than SIN, KUL is much more compact and less walking kilometres from gates.
Welcome aboard Malaysia Airlines! Winner of Best Cabin Staff 2001,2002,2003,2004,2007,2009,2012
 
dtw2hyd
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 12:24 pm

Historically Malays look down on Indonesians(for that matter most of its neighbors). If that pushed them to use SQ, MH has a serious problem. MH cannot count on a population they treated badly for decades and I doubt they can change their attitude.
All posts are just opinions.
 
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mercure1
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 2:58 pm

I wonder if the LAX cut also has something to do with 777 retirements. I recall we had thread about this and the leases were to expire soon. I think they already returned a frame or two.

Quoting tommy1808 (Reply 24):

Keep in mind your linked story was before MH 2013 Q2 and Q3 numbers were out.

Seems the recovery plan has taken a turn for the worse. Even with improvement in LF (up almost 10 points year over year) the carriers losses have grown.

So from more recent comments from the CEO, the carrier needs to redouble its economic savings efforts.
So not sure if more mega birds and their debt are part of such plans now especially with a shrinking longhaul network.
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tommy1808
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 3:21 pm

Quoting mercure1 (Reply 28):
Keep in mind your linked story was before MH 2013 Q2 and Q3 numbers were out.

Of course, but normally that does´t turn a cash cow into a loss queen.

Actually i think this actually increases the chance of Airbus selling 2 or so extra A380 to this customer along with some A350. Airbus sort of has a history of making financing available to customers that are in trouble and there are 17 772ER to replace.

best regards
Thomas
Well, there is prophecy in the bible after all: 2 Timothy 3:1-6
 
airbazar
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 3:36 pm

Quoting a380787 (Reply 5):
Plus the major unspoken benefit of SQ - Indonesia

I would not say it's "the major". It is important, no question about it but the major benefit of SQ, is Singapore itself.

Quoting spud757 (Reply 10):
Why is this? Geographically there's not much between flying via SIN or via KUL.

SQ's product is far superios in all aspects but bottom line is that SIN has a lot more premium O&D. The entire country of Singapore has been built as a global business center that Kuala Lumpur can't match.

Quoting LAXintl (Reply 14):
As you can see the respective home markets are quite different in size with Malaysia demand being a fraction of what Singapore generates.

  
 
a380787
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 4:15 pm

Quoting airbazar (Reply 30):
I would not say it's "the major". It is important, no question about it but the major benefit of SQ, is Singapore itself.

I would call it major because the wealthy Indonesians disproportionately favor SQ over GA, so while volume may not be high, it's a good portion of front cabin

SIN is a smaller city than HKG (even though it has higher per capita GDP due to strength of SGD), so local O&D alone wouldn't be sufficient to fill those high F / high J cabins that SQ offer.

SQ *is* the de facto premium carrier for Indonesia, not GA
 
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IrishAyes
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 4:49 pm

Quoting mercure1 (Reply 28):
Seems the recovery plan has taken a turn for the worse. Even with improvement in LF (up almost 10 points year over year) the carriers losses have grown.

I think saying that its "takena turn for the worse" is a bit dramatic. The situation has yielded some mixed results at worst case scenario, but now MAS has a few more data points on what components of its improvement plan are effective and pragmatic and which ones need to be revisited.

Put simply, I think that chopping glamour routes is the most critical item on the agenda. MH has no reason to remain in LAX.

Quoting airbazar (Reply 30):
SQ's product is far superios in all aspects but bottom line is that SIN has a lot more premium O&D. The entire country of Singapore has been built as a global business center that Kuala Lumpur can't match.

I think another huge folly, and one that will bite MAS in the long-run, is neglecting to tailor to the budget market. It's one of the few remaining network carriers in Asia that still believes in attracting traffic by offering a premium-only product.

Quoting a380787 (Reply 31):
SQ *is* the de facto premium carrier for Indonesia, not GA

Yes, but allegedly GA's new premium product is knocking off everyone's socks.
 
airbazar
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 6:03 pm

Quoting a380787 (Reply 31):
SIN is a smaller city than HKG (even though it has higher per capita GDP due to strength of SGD), so local O&D alone wouldn't be sufficient to fill those high F / high J cabins that SQ offer.

Right, because people who can afford to pay that kind of money to fly prefere a 2-stop routing via SIN+Other to get to the U.S. over a 1-stop routing via DXB/HKG/NRT/ICN/etc.   If you can prove it with O&D numbers I'll agree with you. Until then I'll have to disagree completely  
Quoting LAXintl (Reply 14):
I figured it might be interesting to post this openly.

SIN Daily O&D
LAX - 385
NYC - 308
SFO - 256
HOU - 101
CHI - 65
DC - 53
SEA - 45

That's more than enough to fill SQ's daily number of seats to the U.S. without any connecting traffic. Granted, SIN also has a lot more options but still, your argument that wealthy people would chose a 2-stop routing over a 1-stop just doesn't make sense.
 
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Polot
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 6:11 pm

Quoting irishayes (Reply 32):

I think another huge folly, and one that will bite MAS in the long-run, is neglecting to tailor to the budget market. It's one of the few remaining network carriers in Asia that still believes in attracting traffic by offering a premium-only product.

They did attempt an alliance with AirAsia but it ended up falling apart, I believe mostly due to regulatory issues. The problem with MAS in attempting to tailor to the budget market is that Malaysia is also the hometown of arguably the region's best/healthiest ULCC which a government run, bureaucratic mess like MAS could never directly compete with. Granted I agree with you that they shouldn't ignore it.

[Edited 2014-01-28 10:13:23]
 
aznmadsci
Posts: 1646
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 6:24 pm

Quoting irishayes (Reply 32):
glamour routes

What other glamour routes does MH serve now that EWR, EZE, and LAX have or will close?
The journey of life is not based on the accomplishments, but the experience.
 
Lufthansa
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 6:55 pm

Quoting airbazar (Reply 33):
That's more than enough to fill SQ's daily number of seats to the U.S. without any connecting traffic. Granted, SIN also has a lot more options but still, your argument that wealthy people would chose a 2-stop routing over a 1-stop just doesn't make sense.

Well, if you live outside Jakarta or Bali, then a lot of those cities don't have long haul service/much international service. This is where silkair really comes in. Remember there's 200 million people in indonesia and if you look at where singapore is on the map, its kind of right in the middle, more so than Jakarta is as a hub. Bali doesn't have non-stop service on the ME3(qr stop in sin) so there's another connection/stop, (of course you can still take CX or JL to the US onestop) and if you take a city like Surabaya in Java, hong kong and singapore are pretty much the main international destinations, everything else is domestic. There's plenty of cities like this. That means the business people can go straight to sin in those cities, or, they can go to DPS or Jakarta and then take an international flight. SIlkair's bread and butter is linking SIN with indonesia. I think jakarta has about 18 million ppl in it from memory, so that leaves a good 180 million people out there living in the regions, some of whom are bound to be wealthy.
 
a380787
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 8:19 pm

Quoting airbazar (Reply 33):

Right, because people who can afford to pay that kind of money to fly prefere a 2-stop routing via SIN+Other to get to the U.S. over a 1-stop routing via DXB/HKG/NRT/ICN/etc. If you can prove it with O&D numbers I'll agree with you. Until then I'll have to disagree completely

I'm talking primarily about Europe, not N.A.

For N.A., Japan/NRT is a really popular option (CGK is the only flight within Asia that JAL send their flagship 77W with first suites).
 
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Tomassjc
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 8:31 pm

Back in the 90s the flight opearted KUL-TPE-LAX-MEX. Why I could never really figure out why it continued on to MEX, I do recall that the 747 Combi occasionally came in handy for Mexicana. One year during the Christmas holidays, MX sent hundreds of left behind bags LAX-MEX on Malaysia that could not be accommodated on maxed out 727s and A320s!
Santa arrived in Mexico just in time thanks to MH!

Tomas SJC
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airbazar
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 9:04 pm

Quoting Lufthansa (Reply 36):
I think jakarta has about 18 million ppl in it from memory, so that leaves a good 180 million people out there living in the regions, some of whom are bound to be wealthy.

That's a good point but I wonder how many of those wealthy people live outside of Jakarta. If there really was that much demand other airlines including SQ and not Silk Air would be serving those secondary cities. Having lived in Singapore for a few years I do understand the importance of the Indonesian market to SQ. I just don't think it's that significant in the context of the U.S. routes.

Quoting a380787 (Reply 37):
I'm talking primarily about Europe, not N.A.

Then you're off topic  This thread is about MAS droping its routes to the U.S.  
 
a380787
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 9:28 pm

Quoting airbazar (Reply 39):
Then you're off topic This thread is about MAS droping its routes to the U.S.

It's not off topic because I was responding to a question of why MH is doing poorer in Europe compared to SQ

In case of US - SE Asia, MAS has all the same disadvantages as SQ and nearly none of its advantages.
 
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LAXintl
Topic Author
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 9:52 pm

Quoting tommy1808 (Reply 29):
Actually i think this actually increases the chance of Airbus selling 2 or so extra A380 to this customer along with some A350. Airbus sort of has a history of making financing available to customers that are in trouble and there are 17 772ER to replace.


A380s are only good if you can fill them at good fares, otherwise they certainly must be financial black holes.

MH seems to have focused on the A333E to be its 777 replacement. Virtually identical seat capacity on a lighter frame.

Quoting irishayes (Reply 32):
I think saying that its "takena turn for the worse" is a bit dramatic.

I think his reference was based on specific comment the CEO made regarding the 2012 business transformation plan which showed initial success but by mid 2013 seems to have turned for the worse reversing the early achieved gains.

Quoting Tomassjc (Reply 38):

Back in the 90s the flight opearted KUL-TPE-LAX-MEX. Why I could never really figure out why it continued on to MEX

I think it was part of broader concept of connecting two developing economies. Malaysia in the 1990s had a pretty active foreign and trade policy. Also the aircraft would sit at LAX so its was not the worst thing to run a LAX-MEX-LAX turn.

As I recall MH had some disputes with the Mexican government and cut the flight as it could not secure additional frequencies. Behind the scenes as I recall AM/MX lobbied against MH as they saw the 3-class LAX-MEX 744 service as a danger to their business and eventually had their 5th freedom rights removed. As I recall MH did well loadwise on the route. Its premium product was also a novelty for LA fliers looking to get to Mexico.
From the desert to the sea, to all of Southern California
 
KL808
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 10:00 pm

This route was not profitable to begin with. What I don't understand is why they switched it to NRT from TPE.

At least from TPE you only had to contend with CI and BR. Plus with OW connections and code sharing they could have done better on the TPE route than on the NRT route. AA use to code share with EVA to TPE from LAX, they could have just switched to MH.

KL808
AMS-LAX-MNL
 
CaliAtenza
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 10:23 pm

Quoting KL808 (Reply 42):
This route was not profitable to begin with. What I don't understand is why they switched it to NRT from TPE.

At least from TPE you only had to contend with CI and BR. Plus with OW connections and code sharing they could have done better on the TPE route than on the NRT route. AA use to code share with EVA to TPE from LAX, they could have just switched to MH.

i think if they had kept it going through TPE, it would have lived on longer. I wonder if anyone is going to do a trip report about the final flight...
 
a380787
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RE: Malaysian Ends US Service - Drops LAX

Tue Jan 28, 2014 10:27 pm

Quoting CaliAtenza (Reply 43):

i think if they had kept it going through TPE, it would have lived on longer. I wonder if anyone is going to do a trip report about the final flight...

IIRC both SQ and MH routed via TPE on their way to LAX - SQ's service obviously died upon the plane crash, but i forgot the rationale for MH switching to NRT as well
 
MAS777
Posts: 2766
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RE: Malaysian Ends US Service - Drops LAX

Wed Jan 29, 2014 12:20 am

Re O&D traffic between KUL and the USA - also worth noting that it can be difficult for Malaysians to travel to the USA due to the strict visa application process currently in place so most Malaysian do tend to choose Australia and Europe before the USA when it comes to planning trips.
 
MAS777
Posts: 2766
Joined: Sun Jul 11, 1999 7:40 am

RE: Malaysian Ends US Service - Drops LAX

Wed Jan 29, 2014 1:07 am

Quoting mercure1 (Reply 20):

Well out of London fares are £3400 return to KL in J and usually about £780 in Y... so whilst you may be finding cheap flights out of Europe.. They are not that cheap out of the UK and judging by the people who board at both ends when i travel - some are US or Australia bound whilst the majority seem to be O&D traffic. I have also used MH to travel on to HKG and MEL, SYD and PER within the last year and have usually paid a premium to travel with MH via KUL as SQ, TG, BI and CX are usually cheaper than MH..

So in terms of yield - i can't imagine those packed A380s are full of discounted fareholders.. I believe MAS has also suggested this in the past - and cited this as the reason for not sending the a380s down to australia as the airframes are better used flying up to London instead where the cash is coming in..
 
infinit
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RE: Malaysian Ends US Service - Drops LAX

Wed Jan 29, 2014 1:37 am

Quoting airbazar (Reply 33):

As "Lufthansa" (the user, not the airline) replied earlier, the make-up of Indonesia is different.

Indonesia is a rising superpower with a very big and geographically-diverse domestic economy unlike it's export-dependent ASEAN neighbours- Singapore, Malaysia and Thailand. That's why in the 2008 financial crisis, Indonesia was hardly affected unlike the other three countries referenced. This journal article gives a brief overview of the make up of Indonesia's economy-
http://www.iseas.edu.sg/documents/publication/Trends_2013-3.pdf

Jakarta is a big mega-city but Indonesia has other big market centres- Surabaya, Medan, Palembang, Bandung etc. It can be compared to the US in that regard. I myself know several high net-worth individuals from Medan and Batam, a city 45 minutes from mainland Singapore by ferry that has grown rapidly partly with the investment of Singaporean firms who have moved production over since it is so near and costs are a fraction of what they are in Sg.. a friend joked about how Batam and Bintan in Indonesia and Johor in Malaysia are part of a virtual "Greater Singapore" region.

And as "Lufthansa" suggested, if you are flying from Medan, you either need to connect at Jakarta or Singapore.

Visit Google Maps, type in Singapore and zoom out- you'll realise Singapore is actually a lot nearer to many Indonesian (and Malaysian) cities than their capitals. And SQ is a very strong brand name in Indonesia, the I-only-fly-SQ syndrome is still pretty strong there. Plus the idea of connecting in SIN vs CGK.. although now that CGK is revamping itself maybe SIN will decline in attractiveness over time.

Perhaps 20 years down the road where Indonesia might be the 7th largest economy, there would be enough demand for long-haul international flights directly out of Medan for example but for now Indonesia's geographically diverse population would still need to connect.



*edited for typos

[Edited 2014-01-28 17:54:22]
 
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legacyins
Posts: 1960
Joined: Sun Aug 31, 2003 1:11 pm

RE: Malaysian Ends US Service - Drops LAX

Wed Jan 29, 2014 1:54 am

Found this article stating MH is thinking about restarting service to New York via LHR.

http://www.btimes.com.my/articles/MAAAS/Article/
 
CaliAtenza
Posts: 1686
Joined: Mon Dec 25, 2006 1:43 pm

RE: Malaysian Ends US Service - Drops LAX

Wed Jan 29, 2014 9:55 am

Quoting legacyins (Reply 48):


Found this article stating MH is thinking about restarting service to New York via LHR.

http://www.btimes.com.my/articles/MAAAS/Article/

i was just about to post a link about that:

http://my.news.yahoo.com/york-mas-39-radar-150503374.html

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