Introduction
Malaysia Airline Systems (MAS) like many other airlines is
suffering financially, this is due in part to world events
that have occurred recently and market conditions in Asia,
although these market conditions have also been experienced
on a worldwide scale. People have been reluctant to fly after
the events of September 11 2001, the wars in Afghanistan and
Iraq, and the outbreaks of the Servere Acute Respiratory Syndrome
or SARS as it is more commonly known. There has also been
the problem of more companies entering the airline market
sector especially the low cost operators such as BMI Baby
or EasyJet. If MAS is to survive the next 3 to 5 years they
are going to have to compete against powerful carriers like
BA and Qantas, low cost carriers, and strategic alliances
such as One world and Star Alliance. To win back and retain
customers MAS is going to have to implement a marketing plan
and a strategic business plan, which is going to have to incorporate
the current positioning and branding of MAS and how they want
to be perceived in the future. This essay will attempt to
answer the question 'If MAS is to survive and thrive in the
future how would you combine the resources and skills of the
Operations and marketing functions over the next 3-5 years?'
This will be done using marketing tools and models such as
perceptual maps, SWOT analysis. Being successful is about
more than surviving and if MAS is to realise their vision
"To be the largest, most successful and most respected
airline in the world"[1] they are going to have to realise
that money will need to be spent.
Current Situation
We will begin the analysis of the current state of Malaysia
Airlines by looking at their most important asset, their planes
Aircraft Type |
No. of Aircraft |
Engine Type |
B747-400 (Passenger) |
17 |
PW4056 |
B747-200 (Freighter) |
2 |
RB211-524D4 |
B777-200 |
15 |
TRENT 892 (RR) |
A330-200 |
3 |
PW4168A |
A330-300 |
9 |
PW4168 |
B737-400 |
39 |
CFM56-3C1 |
F50 |
10 |
PW125B |
DHC6 Twin Otter |
5 |
PT6A-27 |
Total |
100 |
|
Table 1 - MAS Fleet [2]
After their planes we should look at their financial figures
to see how MAS has weathered the financial storm since 2000
Strengths
Malaysian Airlines is the pride of a nation, they carry the
Malaysian flag and their success is important to the country.
This means that they can and have been aided by the government.
[3]
MAS have also invested a lot of money on IT, which has left
them in a strong position to leverage this IT to the benefit
of their customers and performance.
MAS is an award winning company, having diversified into many
areas of travel,[4] even during the difficult era for the
airline industry.
1999 Received 'Top Airline-Service Staff Service' in
their World First Class Survey by a UK based In- flight Research
Services
2000 Awarded the Five Star Diamond award by the American Academy
of Hospitality Sciences.
Rated 'Number One Airline' for cabin staff operations by Australian
travel magazine, 'Luxury Travel'
Notched top placing for best cabin staff service in first
class in the 2000 World First Class Survey conducted by In-flight
Research Services (IRS) of United Kingdom
2002 Received 'Best Cabin Staff 2002' award in an international
airline survey conducted by Skytrax Research of London, UK.
Table 2 - Awards for MAS
In what may seem a contradiction the management team at MAS
received an award from the Asian Institute of Management and
the World Executive Digest, for its excellence in general
management and success in positioning itself in the airline
industry. [5]
Weaknesses
Financially speaking, pre 2003, MAS made a loss for 5 years
running, although before this MAS was known as a company that
was happy to invest for the future. This may have helped cause
the current situation. One of the reasons for this was the
purchase of 25 Boeing planes to be delivered over 5 years
The purchases of the aircraft were made in US Dollar and no
hedging method was used at that time because of the stable
currency between Ringgit Malaysia against U.S Dollar. Unfortunately
in 1997, Asian countries including Malaysia incurred economic
down turned which, has resulted the devaluation of Ringgit
Malaysia and an increased of interest rate. Consequently,
MAS' cost of purchase increased tremendously.
-
Sohail (2003): 3
-
Malaysia airlines: corporate < http://www.malaysia-airlines.com/corporate/?menu=au&mode=mas03
> [Date Accessed 01/08/03]
-
Malaysian Airline Systems < http://uia2k.tripod.com/MAS.htm
> [Date Accessed 01/08/03]
-
Sohail (2003): 6
-
ibid: 7
-
BIBLIOGRAPHY
-
Crawford, R.B Leadership style. HRODC
(2001)
-
Jobber, D Principles and Practice of
Marketing, 3rd Ed. McGraw-Hill Education (2001)
-
Kotler, P Marketing Management US Imports
& PHIPEs (2002)
-
McDonald, M Advanced marketing planning,
Cranfield Business School (2000)
-
Sadiq Sohail, M. Malaysia Airlines
(MAS) - Facing Challenges in the New Millennium, KFPUM
(2003)
-
2002 airline analysis < http://btcweb.biz/airlineanalysis.htm
> [Date Accessed 01/08/03]
-
Asiaweek.com < http://www.asiaweek.com/
> [Date Accessed 01/08/03]
-
Malaysia airlines: corporate < http://www.malaysia-airlines.com/corporate/
> [Date Accessed 01/08/03]
-
Malaysian Airline Systems < http://uia2k.tripod.com/MAS.htm
> [Date Accessed 01/08/03]
-
Market segmentation < http://www.businessplansoftware.org/advice_segment.asp
> [Date Accessed 01/08/03]
-
MEA < http://www.mea.com.lb/ >
[Date Accessed 01/08/03]
-
The five forces model
< http://www.wiley.co.uk/innovate/website/pages/atoz/fiveforcesmodel.htm
> [Date Accessed 01/08/03]
-
Traventec.com < http://www.traventec.com/
> [Date Accessed 01/08/03]
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