Prudent recovery strategy for Malaysia Airlines

KUALA LUMPUR – Malaysia Airlines experienced a bigger loss in the first quarter of 2014, due to ticket sales plunging. Malaysia’s flag carrier net loss for the three months ended March 31 topped RM 443.4 million (US$ 137.8 million). The airline acknowledged that the tragic disappearance of MH 370 in early March further put stress on its finances as passengers in some markets – mainly China- turn their back to MAS. According to the Wall Street Journal last Friday, sales revenue from China fell 60% in March.
 

MAS Director of Commercial Hugh Noel Dunleavy looks at the next recovery stage for the carrier and answered the following questions.
 

TravelDailyNews: How is the image of MH in the public opinion? Did you suspend any communication and marketing actions for the time being? When do you forecast a return to normal in terms of image?
 

Hugh Noel Dunleavy: MAS suspended all of our on-line and off-line communications activities worldwide on March 8th. At the same time, we shifted our mode of marketing to engage with our travel agency trade partners to support our regular indirect sales activities. Whilst the SAR activities were coordinated by the government of Malaysia, the airline opened up a incident web site to provide up to date information on the MH370 incident. The key focus of the airline being the welfare of the family members of the passengers and crew of mh370 and ensuring their care and well being..
 

Approximately two months after the incident (around the last week of April), the commercial team began to transition our activities back to our malaysiaairlines.com. MAS has returned to our regular business functions on the web site as of May 7, some two months after the MH370 incident. With the restart of our commercial web site, we will also be launching a series of tactical price point advertising in several markets including Malaysia starting on the 15th May.
 

TDN: If marketing activities have been put on hold, when will you start again to communicate?
 

HND: MAS will be launching an above the line thematic campaign with a specific message in mid-June.
 

TDN: Will it be a specific strategy for China? Did you shed frequencies to China/Taiwan/Hong Kong? What will be done to win back passengers from this important market when compared to other markets?
 

HND: Our communications strategy is, and will be tailored to all individual regional markets including China. Our strategy in each market is determined based on data received hourly from our 16 different country web sites globally, and we adjust our communications to fit the specific action, and reaction in each market. For obvious reasons, the commercial plans and the specifics of the overall campaign in China are confidential and will not be revealed prior to their launch.
 

TDN: How far has been MH affected in terms of passengers number? How could it translate financially and how could MH eventually rebalance the eventual losses?
 

HND: We are reviewing flight loads using our normal Standards of Performance (SOP) and where we observe flights with low loads and where the passengers can be readily accommodated on a neighbouring flight, the airline will look for opportunities to minimize costs. However, it should be noted that the airline is also cognizant of its brand integrity and we are doing our utmost to minimize any ad-hoc cancellations.
 

TDN: How big is the support and empathy from the Malaysian State towards the national carrier? Is the State ready to step in if MH is facing troubles now?
 

HND: We have received immense support from all audiences inside Malaysia, and the ASEAN region in total. Besides the government support, our strategic stakeholders including oneworld member airlines have offered their support in these trying times. We have also received thousands of messages of support, and requests from various organisations on how they can assist MAS during this very difficult time.
 

There are frequent discussions between MAS and the Malaysia Government and MAS is pleased with the support we have received from the various Malaysia Government Agencies and the governments involved in the MH370 incident, be it SAR activities or more importantly family support activities.