MAS ... Jul12

The question many people ask now is whether Malaysia Airlines (MAS) can undertake a turnaround within its targeted timeframe, and the options available to ensure the national carrier continues to fly without having to contend with a financial turbulence time and again.

If its latest turnaround plan goes according to plan and achieves the desired results, it is possible for the airline to return to the black, but this will require a lot of cash. MAS needs cash in order to move forward to rebuild its brand name and consolidate its financial structure to ensure it remains competitive among other regional players.

Privatisation of MAS would be another way to restore the position of the national carrier and now (June 2012) would be the best time to do so as its share price was cheap.

Despite its financial woes, MAS was still relevant as it played a major role in spurring growth in related activities such as aircraft maintenance, repair and operations businesses, leasing aircraft as well as the tourism industry.

Its top management needed to further bolster efforts to save the airline by focusing on its niche business. MAS as a full services carrier should focus on attracting more passengers for its business and first class seats, which generate a higher yield compared to the economy class, which was more price sensitive.

When compare MAS with its peers, the cost structure is just about the same. However, in terms of revenue, MAS does not match them, and this is one main reason why it is still lagging behind. MAS also lags in terms of services and products.