The Malaysian Insight

IT makes little difference to Malaysia Airlines Bhd’s (MAB) fortunes who is chosen to head the national carrier as long as there is political interference, says an independent aviation analyst even as the airline announced the appointment of a new CEO last night.

Some MAB employees told The Malaysian Insight they felt the same way, having witnessed outside interference in the running of the airline.

“Whoever is eventually chosen by the stakeholders and board of directors to replace Bellew will make little (if any) difference,” said Shukor Yusof of Endau Analytics.

“In our view the airline is beyond rehabilitation and saving until and unless certain hard-nosed decisions are made,” Shukor wrote on his blog.

Such decisions include the removal of personnel who are weighing the firm down, he said.

“That’s just a start. Ironically MAB is in no better position today despite having been ‘transformed’ by Malaysia’s sovereign wealth fund, the airline owner,” he said referring to Khazanah Nasional Bhd.

“Is the sovereign wealth fund prescribing the wrong medication? Is the sovereign wealth fund the problem?”

MAB has named Captain Izham Ismail its group CEO designate and executive director after the shock resignation of Peter Bellew earlier this week.

Bellew was the second foreign CEO in the troubled history of MAB, who took over the job in August last year from German Christoph Mueller, who left for Emirates airline.

In a short message to the Nikkei Asian Review, Bellew denied that Khazanah had interfered in his job.

Khazanah also denied a report in the New Straits Times that Bellew’s departure was due to the state fund’s meddling.

“The Malaysia Airlines Board of Directors and management submits its key plans to Khazanah as the sole shareholder and funder of the restructuring, and collectively, we have worked closely together to deliver the progress of the on-going restructuring to date,” Khazanah said.

In separate interviews with The Malaysian Insight, however, former MAB employees said they saw signs of outside interference in the running of the company.

“There’s too much political meddling in Malaysia. That’s why it’s difficult for anyone who takes over to do their job. As long as there is political interference, it is difficult to drive any company,” said a staff member who requested anonymity.

The staff member also said it was unfair that the company had laid off so many of its employees only to hire new ones the next year.

MAB laid off 6,000 employees in June 2015 under its recovery plan. Mueller, its then CEO, said the airline was “technically bankrupt” but could break even by 2018 if it cut staff and some routes, and sold surplus aircraft.

Another former staffer said Mueller and Bellew appeared to have had little say in the restructuring of MAB.

“When I was still there sometime in December 2015, Peter had attempted to leave the company… And frankly I am not surprised that he has left now.”

The MAB recovery plan was put into effect in August 2014 by Khazanah, which injected RM6 billion into the airline and delisted it. Under the plan, which was initially overseen by Mueller, MAS also renegotiated its supply contracts.

This was after MAB lost two aircraft, MH370 in April and and MH17 in July of 2014.

In June last year, Mueller was criticised for saying that he had to cut jobs because he had found that many of the airline employees had “nothing to do” and that some were “sleeping on the job”.

“As long as MAB continues to be funded by the government, and the government is unwilling to let it be run by responsible, trustworthy professionals who truly understand the business, then the airline is bankrupt of ideas. It is no longer relevant or viable. It lives, but only just,” Shukor wrote.

MAB yesterday said Izham’s appointment was in line with succession planning under the airline’s recovery plan. – October 21, 2017.