Beleaguered Malaysia Airlines this morning reported a bigger-than-expected second quarter loss in the wake of the two tragedies that have befallen the carrier.
Malaysian Airline System Bhd. said net loss in the three-month period that ended June 30 was about $97 million USD; it was hoping for a loss closer to the $55.8 million it lost last year in the second quarter. Operating revenue fell seven percent.
Malaysia Airlines Flight 370 disappeared in March en route from Kuala Lumpur to Beijing and has yet to be found; Flight 17 from Amsterdam to Kuala Lumpur was shot down last month over Ukraine.
The financially plagued airline announced last month it would restructure, and pushed up the timetable after receiving approval from the government this week. The airline is looking to cut about 5,000 of its 20,000 employees and may abandon some of its current routes to China and Europe that are less profitable.
Ahmad Jauhari Yahya, group chief executive of Malaysia Airlines, told the Financial Times that "We operate in a harsh business environment of stiff competition from regional and global carriers and high operational costs. Coupled with the impact of the two tragedies, which have damaged our brand, the need to restructure the company was accelerated. Our company has had to undergo a thorough re-examination and re-evaluation in order to reposition ourselves as a stronger and more sustainable Malaysia Airlines for the future."
The airline has been focusing its efforts of late - and deep discounts - on the Australia and New Zealand markets, with $495 flights to Kuala Lumpur and a new promotion called "My Ultimate Bucket List" in which it is giving away 12 free return flights.
Malaysia Airlines has already nearly doubled commission for travel agents in Australia and New Zealand from six percent to 11 percent.
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