Will Japan Airlines Purchase Shares of Malaysia Airlines?

Malaysia airlines, Japan Airlines, Malaysia, air transport

Malaysia Airlines Trims Again Its Network

Could Japan Airlines step into the capital of embattled national carrier Malaysia Airlines. Rumours about a possible entry of the Japanese carrier in MAS shook up the country’s political world ten days ago…

On September 14, Malaysia economic and financial magazine the Edge reported that a possible tie-up between Japan Airlines (JAL) and Malaysia Airlines could occur with the Japanese carrier taking a stake in the troubled national airline. Quoting sources familiar with the development, it said there are high level talks for JAL to acquire a stake in Malaysia Airlines because of the close ties between Putrajaya and the Japanese government.

Both Japan Airlines and Malaysia Airlines recently signed up a cooperation agreement on flights between Malaysia and Japan. The partnership between the two One World Alliance members will entail coordination and cooperation in areas, such as schedule and capacity, sales and marketing, performance monitoring and revenue planning for the Malaysia-Japan route.

The information over the take acquisition by JAL was neither confirmed or denied a few days later by Malaysia Prime Minister Mahathir Mohamad. Talking on a local radio station on September 17, the PM explained that the government is still looking for ways to help troubled Malaysia Airlines Bhd.

“It’s not easy… we have done a lot. The previous government gave them RM6 billion and sacked 6,000 people, and in addition, reduced the number of flights.

“So, if you reduce the personnel and the number of flights, the ratio between personnel and the activities doesn’t change,” he said in the interview with the radio station.

Dr Mahathir said there is talk that some companies might take a stake in the airline, but noted that there are also some people who are very sentimental and want to see the company owned entirely by Malaysians. “But, there is no Malaysian investor strong enough to take it up,” he explained.

When asked about the government’s deadline to decide on the fate of Malaysia Airlines, he reiterated that it’s not easy. “As you know, Malaysia Airlines has undergone many changes, including changes in the management and sacking of 6,000 workers… and yet the losses remained high,” Dr Mahathir added.

The prime minister also noted that when the national airline was formed, there was no low-cost carriers like today.

(Source: Bernama)