Malaysia Airlines will cut seat capacity, review its fleet and routes and re-negotiate staff contracts as part of a major restructuring programme.
Announced this week by owner Khazanah Nasional Bhd the airline is aiming to emerge as a new company on July 1 this year.
It is the first announcement by the state investment firm since it took control of the troubled airline last year, after it was hit by two tragedies – the disappearance of flight MH370 and then four months later flight MH17 which was shot down in an attack over East Ukraine.
According to Reuters, Khazanah has outlined a 12-point recovery plan targeting profitability by end-2017 and re-listing by 2020.
It wants to cut capacity by 10 per cent and focus “on more profitable domestic and regional routes”.
“This short-term network consolidation is expected to enable a strengthening of the airline’s financial position,” Khazanah said.
It added that routes flown to the Middle East and Europe, which include London, Amsterdam and Paris, were being “carefully evaluated” and could be discontinued if they did not contribute to group profitability.
In December last year MAS appointed former Aer Lingus boss Christoph Mueller as its new CEO.