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Malaysia Airlines Bhd considers more flight cuts

KUALA LUMPUR: Malaysia Airlines Bhd will stop more flights from its current 20 per cent of total capacity in operation, if the Covid-19 pandemic continues to hammer the national carrier.

Its spokesperson confirmed that Malaysia Airlines currently operates less than 50 flights daily due to the enforcement of travel ban globally to curb the spread of the lethal virus.

“We foresee further reduction in the coming weeks following more stringent travel restriction by governments worldwide,” he told the New Straits Times.

It is learnt that Malaysia Airlines had halted services including to China (Beijing and Kota-Kinabalu-Shanghai), South Korea, and Saudi Arabia (Jeddah and Madinah) via its pilgrimage unit, Amal.

However, the carrier’s Kuala Lumpur-United Kingdom services are operating as usual, other flight frequencies are gradually reduced, dependent on the severity of the travel ban.

To date, the carrier has grounded 65 per cent of its aircraft fleet as appetite for travel weakens.

Malaysia Airlines has a total of 81 aircraft catered to serve 58 destinations, primarily in Asia Pacific and one destination in the United Kingdom.

The airline’s fleet comprises the A380 (six units), A350 (six units) and A330 (21 units) as well as the B737 narrow-body plane (48 units).

Its network service is also supported by strategic partners via the 'oneworld alliance' with more than 1,000 destinations.

“We have higher capacity than other carriers at this time as we operate domestic and some international flights, mostly to repatriate Malaysians and transport foreigners returning home. It is our duty to serve the affected people,” he added.

Global airlines reportedly have asked for governments financial assistance to cope with the pandemic.

American Airlines recently reduced 75 per cent of its operations, while United Airlines planned to cut 90 per cent of international services, scheduled for April.

Singapore Airlines reduced 96 per cent of its cutting capacity, followed by British Airways by 75 per cent for April and May.

Malaysia Airlines had recently deployed two rescue flights to ferry Malaysians stranded in Cambodia and Bangladesh back home.

Meanwhile, Sobie Aviation consultant and Singapore-based independent analyst Brendan Sobie said all airlines would be significantly impacted, particularly carriers with full reliance on international flights.

“This unprecedented crisis is making it very challenging for all airlines. Having governments’ support is critical at this juncture. If they do not provide support, it will be disastrous,” he told NST recently.

Sobie said government’s support is not necessarily passing over money or bailing out airlines but rather a big part could be job support from the government covering wages until the the crisis is over.

He said this is to ensure the workers are there when flying can resume. “There are also items like loan guarantees, exemptions from taxes and fees,” he added.

Sobie said it was encouraging that support discussions between the government and airlines had started in Malaysia, similar in many other countries in Asia and globally.

“It is critical that the government come up with a package in the next few days. All of Malaysia's airlines will need government assistance to get through this unprecedented crisis,” he urged.

International Air Transport Association (IATA) estimated that global airlines’ passenger revenues could plummet 44 per cent to US$252 billion from US$567 billion recorded in 2019, owing to the severity of travel restrictions and the expected global recession.

IATA had previously projected that global airlines could incur between US$63 billion and US$113 billion losses in revenue this year.

This was based on two possible scenarios – limited spread and extensive spread - due to the evolving situation with the Covid-19.

“The airline industry faces its gravest crisis. Within a matter of a few weeks, our previous worst case scenario is looking better than our latest estimates.

“But without immediate government relief measures, there will not be an industry left standing. Airlines need US$200 billion in liquidity support simply to make it through. Some governments have already stepped forward, but many more need to follow suit,” said IATA director general and chief executive officer Alexandre de Juniac.

IATA predicted that Asia Pacific airlines’ revenue passenger could reduce 37 per cent to US$88 billions this year.

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