Move comes as load factor for flights connecting strategic cities reaches a ‘sad level’ and becomes economically untenable

by AFIQ AZIZ/ pic by TMR FILE

MALAYSIA Airlines Bhd (MAB) has halted all interstate operations in Peninsular Malaysia since Monday, the first time in the carrier’s history, as the coronavirus pandemic has practically destroyed the airline industry.

The move to cease flights to cities across the peninsula came as the load factor for the flights that connected strategic cities reached a “sad level” and has become economically untenable.

MAB COO Ahmad Luqman Mohd Azmi, in an internal memo sighted by The Malaysian Reserve (TMR), described the situation as a “very sad moment” in the carrier’s 73-year-old history.

“For the first time today, Malaysia Airlines has no interstate operations in Peninsular Malaysia due to poor load factor, which would not poor load factor, which would not be economically viable for us to operate.

“I can’t help but feel very, very sad as never has there been a day such as this in Malaysia Airlines’ long history of serving the nation and our customers worldwide,” Ahmad Luqman said in the internal communication.

Ahmad Luqman is also the Malaysia Aviation Group (MAG) Emergency Operations Committee chairman.

The interstate operations connected Kuala Lumpur to Kuala Terengganu, Kota Baru, Penang, Kuantan, Johor, Alor Star and Langkawi Island.

Millions of people travel annually on these intercities routes, which have become a key economic driver for the states. The temporary suspension of flights in Peninsular Malaysia will further weigh on the economic activities in these states.

Ahmad Luqman said the group still maintains about 6% of its total network capacity, with 42 departures recorded on Sunday for MAB.

These, he said, include five passenger-to-cargo (P2C) flights and two charter flights to Auckland, New Zealand.

The P2C aircraft is currently being used to transport medical goods into the country from all over the world, including from China.

Ahmad Luqman said MAB will still serve long-haul routes, while its sister company FlyFirefly Sdn Bhd (Firefly) will maintain its operations in the peninsula, but at a very low frequency.

“We are still servicing sectors such as Tokyo, Sydney, Shanghai and Hong Kong. Firefly operated 16 flights utilising five aircraft,” he said.

The escalating number of Coronavirus cases globally — which crossed one million cases last week and have killed more than 75,000 people — have forced governments into lockdown, closing borders and enforcing stay-at-home orders.

The moves, however, have dragged the airline industry into the worst crisis in aviation history.

Almost 4,000 people have been infected by the SAR-like pathogen in Malaysia and more than 60 people have died from the virus, which was first detected in Wuhan, China, in December last year.

The government has also imposed a four-week Movement Control Order (MCO), which ends on April 14. The authorities may propose an extension depending on the situation. Presently, foreigners are barred from coming into the country.

Ahmad Luqman said the government is also expected to impose social distancing for passengers on flights.

“This proves to be a challenge for us operationally, especially on board, considering the ideal load factor that we have to meet in order to make a flight viable. Nevertheless, we are in discussion with the relevant authorities in finalising the standard operating procedures,” he said.

MIDF Research aviation analyst Adam Mohamed Rahim said MAB’s move was deemed inevitable, following the slowdown of operations.

“MAB’s low-cost carrier competitor, AirAsia Bhd and it’s long-haul arm Air Asia X Bhd had temporarily suspended international and domestic flights for a span of three weeks and almost two months respectively,” he told TMR in a text reply.

Last month, AirAsia Group Bhd decided to suspend its short-haul and medium-haul flights.

AirAsia has also grounded most of the planes servicing the Philippines, Thailand, Indonesia and India.

Adam expects MAB would have to halt its medium- and long-haul destinations should the coronavirus pandemic continues to increase around the globe.

“With more lockdowns imposed by other countries such as Italy and India, MAB may be prompted to further suspend international flights,” he said.

MAG had already warned that it could go bankrupt like other airlines due to the pandemic.

The company has offered its 13,000-strong staff two voluntary options, either five days of unpaid leave per month for at least three months or unpaid leave of between one and three months beginning April. The company’s top management also took a pay cut to retain cash.