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  • Case Study: Malaysia Airlines Marketing Challenge

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    DiprajSinha
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    Malaysia Airlines has experienced periods of growth, losses, and turnaround since its inception in 1947. In the 1980s and 1990s, passenger travel increased as the Malaysian economy grew. However, the airline suffered losses of $260 million after the 1997 Asian financial crisis due to poor management. Further losses occurred in the early 2000s and 2005 due to declining cargo revenues and increased costs. In 2005, Idris Jala was appointed managing director to turn the airline around. His initiatives in pricing, routes, and operations helped reduce costs and the airline became profitable again by 2007. However, fuel price increases led to another large loss of $2.52 billion in 2011.

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    Malaysia Airlines has experienced periods of growth, losses, and turnaround since its inception in 1947. In the 1980s and 1990s, passenger travel increased as the Malaysian economy grew. However, the airline suffered losses of $260 million after the 1997 Asian financial crisis due to poor management. Further losses occurred in the early 2000s and 2005 due to declining cargo revenues and increased costs. In 2005, Idris Jala was appointed managing director to turn the airline around. His initiatives in pricing, routes, and operations helped reduce costs and the airline became profitable again by 2007. However, fuel price increases led to another large loss of $2.52 billion in 2011.

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    6 views6 pages

    Case Study: Malaysia Airlines Marketing Challenge

    Uploaded by

    DiprajSinha
    Malaysia Airlines has experienced periods of growth, losses, and turnaround since its inception in 1947. In the 1980s and 1990s, passenger travel increased as the Malaysian economy grew. However, the airline suffered losses of $260 million after the 1997 Asian financial crisis due to poor management. Further losses occurred in the early 2000s and 2005 due to declining cargo revenues and increased costs. In 2005, Idris Jala was appointed managing director to turn the airline around. His initiatives in pricing, routes, and operations helped reduce costs and the airline became profitable again by 2007. However, fuel price increases led to another large loss of $2.52 billion in 2011.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pptx, pdf, or txt
    of 6

    Case study

    Malaysia airlines marketing


    challenge

    Inception
    The comp started as Malayan airways ltd. &
    had its first commercial flight in 1947
    After separation of Singapore (9 Aug 1965)
    from Malaysia the former partner form separate
    entities in 1972 as Singapore airline & MAS
    The large part of share holdings (69.4 %) was
    retain by Malaysian govt.

    Growth
    In 1980s due to financial growth in the country air
    passenger travel increased
    During 1990 MAS had started flying to 47
    destinations including London, Zurich, Darwin Perth,
    Melbourne etc
    Foreign direct investment regulation started in
    Malaysia
    In 1991 5.5 million tourists visited Malaysia from
    neighbour country
    Tourism industries contributed US $ 2.4 billion to the

    Loss
    First phase of loss
    1997 financial crisis brought the expansion of MAS
    Ego driven , and without efficient management
    Suffered loss of 260 million
    Reduced losses by 63 % in FY 1998/99
    Subsequent losses 413 million in FY 2000/01 & 836 million in FY 2001/02

    Second phase of loss


    Occurred in 2005
    The main reason of decline in cargo revenues in compare to previous
    year
    Increase in various overheads fuel price , hanger charges, handling and
    landing etc

    Turn around phase

    2005 to 2007

    Idris Jala inducted as a MD

    Competitive cost structure in the region

    Better place to work in Malaysia

    Closed much of the revenue performance gap to peers

    Key areas of pricing, revenue management, route


    rationalization, rescheduling of flights etc

    After plan was put in to practise MAS announced 851


    million of profit by 2007

    Third phase of losses


    Again MAS recorded massive loss of 2.52 billion
    in 2011 due to increase in fuel prices (25%)

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