The tragic disappearance of MH370 has taken a huge toll on MAS.Since the plane vanished on March 8, the airline has cancelled close to 900 flights. MAS share is dropped 2 sen to 19 sen yesterday,about 10% drop after the airline revealed the extent of the financial damage to its business caused by MH 370.Cancellations were mainly for china and Asian flights and demand seems to have hit rock bottom. In March,sales in China fell by 60% after the lost of MH370.Recently on of its flighs to Bali had less than ten passengers and it would have been wiser to cancel the flight rather than endure a big loss to proceed with that flight. The decline in the number of passengers was also seen on its 500-seater A380 flagship route to London, where on some days the plane carried about 200 passengers. Flying with less than 30% load means MAS is flying at loss and as it stands, MAS is burning up to RM2million in cash a day!!. Couple with finance cost, the cash burn rate is RM4 millions. MAS has RM3.3 billions cash at the end of March but that amount has fallen to RM 2.8 billions. If nothing is done, its cash reserves can be depleted by 2015/2016. Even Prime Minister has “wash hand” saying that’s its too late to save the airline with the current form. He is saying that bankrupt might be the option to restructure MAS. 4,000 to 7,000 jobs maybe slashed. MAS should learn from Japan Airlines,Garuda Airlines and many more. Look what we have done to our the one and only nation airline. This is what will turn out be if the operation is running by cronies and brainless CEO.
Posted on: Sat, 17 May 2014 14:01:28 +0000
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