The Malaysian government is mulling over the possibility of closing the country’s flagship airline as financial losses pile up and there seems no way out of the downward spiral.
Once one of Skytrax’s legendary five-star airlines, Malaysia has quickly fallen from those once lofty heights.
The beleaguered company lost around $750 million (R10.8 billion) last year, prompting Malaysian Prime Minister Mahathir Mohamad to mull over whether it should be sold or wound up. The airline was founded in 1937 as Malayan Airways.
Few airlines have quite the checkered reputation of Malaysia Airlines. With two relatively recent fatal accidents and a less-than-healthy financial standing, the airline has had a lot to contend with over the past few years.
“It has failed for one central reason: Malaysia Airlines remains a state-owned flag carrier, slow-moving, and burdened by political expectations,” wrote Adam Minter, author of Junkyard Planet: Travels in the Billion-Dollar Trash Trade, on Bloomberg.
It’s something to consider for Ramaphosa and his government who are still determined to pour money into South Africa’s national carrier, despite it never being as large or successful as its Malaysian counterpart.
As recently as January this year, the ailing parastatal was granted another R3.5 billion in bailouts, with the statisticians at Africa Check finding that R29 billion has been ploughed into SAA from 1999 – 2017.
The Malaysian government has said it is about ready to pull the plug, with options of selling, refinancing or closing Malaysia Airlines all under discussion, and have said they are currently studying the airline’s business plans and a decision on the future of the carrier would be made ‘soon’.