We Will Study Details of FAX’s Proposals First: Idris

MALAYSIA Airlines (MAS) needs to study the proposal by Fly Asian Xpress (FAX) to hand over its rural routes to Firefly, the newly- launched airline owned by MAS.

MAS managing director Idris Jala said yesterday the national carrier needed to look at details of the proposal before deciding whether to accept the rural routes.

“We have yet to get any official communication in writing from the Government. As soon as the opportunity arises, we will take a look in due course,” Idris told reporters after MAS’ extraordinary general meeting in Petaling Jaya.

On April 17, rural air services operator FAX submitted to the Transport Ministry its proposal to let Firefly take over its services.

Based in Miri, FAX operates 22 routes and 104 flights daily in Sabah and Sarawak.

FAX’s offer for Firefly to take over the operations of the rural air services was reportedly because it wanted to focus on its planned long-haul low-cost AirAsia X operations.

Asked whether MAS will take back the routes, Idris said that from the shareholders’ perspective, the airline has to follow the governance process.

“When the domestic routes were rationalised last year we had to go through our normal process of approval.

“Certainly, we will have to look at the details before making up our mind as a company on what is our position on this matter,” Idris said.

“Everything is on basis of the details, so you cannot simply say yes or no without looking at the details,” he said when asked whether he had reportedly said that MAS did not mind taking some of the routes.

It was reported that since taking over the operations from MAS last August, FAX has carried 500,000 passengers with a load factor of 69 per cent.

On whether accepting the proposal will affect MAS’ business turnaround plan (BTP), Idris said the airline would not do “something that will jeopardise the BTP”.

“Everything that we will decide must be consistent with the declared mission to be a profitable airline,” he said.

“One thing is clear in MAS is that we are totally committed to our BTP.

“All the decisions we make will have to take into account our BTP,” he added.

Asked whether MAS will accept though the services offered by FAX are subsidised by the Government, Idris said all the details would be studied, including the subsidies.

“We need all the details to be laid out. Once we have the details, we will make up our mind as a company. We don’t have any deliberation with the Government yet,” he said.

If all the requirements met MAS’ expectations, the national carrier will make a decision on the matter, Idris said.

“We will see in due course. We will come back and explain to you,” he said.

On MAS’ first-quarter results ended March 31 2007, which will be announced soon, Idris said the figures were “looking good”.

For the fourth quarter ended December 31 2006, the airline posted a pre-tax gain of RM143.091 million compared to a pre-tax loss of RM599.193 million in the third quarter.

Revenue rose to RM3.780 billion from RM3.211 billion previously.

For the full year, MAS recorded a lower pre-tax loss of RM73.092 million from a pre-tax loss of RM1.108 billion.

Revenue increased to RM13.489 billion from RM12.324 billion previously.

(c) 2007 New Straits Times. Provided by ProQuest Information and Learning. All rights Reserved.