Malaysia Airlines (MAS) is to cut 30% of its workforce and slash many long-haul routes as it starts a major restructuring process, following the MH370 disappearance and shooting down of MH17.
Following the two disasters, which resulted in the loss of 537 passengers and 29 staff members, the recovery plan will see 6,000 of the airline’s 20,000 staff lose their jobs.
The airline will become completely state-owned and a new CEO will be appointed. A name change is also widely expected.
MAS will axe a number of routes to China. In Europe, the airline currently flies to London Heathrow, Paris, Amsterdam and Frankfurt — it is not yet known which service(s) will be axed, but it is believed the German route is likely to go.
MAS’ majority owner, the Khazanah Nasional state fund, said the airline would be taken off the stock market by the end of the year so it could start the process- with the bill for the recovery process estimated at £1.15 billion.
Khazanah, which currently owns 69 per cent of MAS, forecast a return to profitability within three years of its de-listing.
“The need to restructure the company was accelerated” after the disasters damaged the brand, MAS CEO Ahmad Jauhari said in a statement yesterday.
“Our company has had to undergo a thorough re-examination and re-evaluation in order to reposition ourselves as a stronger and more sustainable Malaysia Airlines for the future.”
MAS reported a net loss of £59 million for the three months ending June 30. Adding to the earlier loss of around £85 million in Q1.
The airline has struggled with profitability for several years ahead of this year's disasters.