Aviation analyst says S'pore Airlines & M'sia Airlines should merge to improve efficiency

It would be good for business, he said.

Matthias Ang | May 11, 2019, 01:04 PM

Singapore Airlines and Malaysia Airlines should merge.

This was a view expressed by regional aviation analyst Mohshin Aziz of Maybank Kim Eng, as reported by Malaysian media.

Beneficial for both airlines

According to The Star, Mohshin explained that such a move is beneficial for both airlines as it would be more efficient.

He said:

"If they were to merge, there will be a lot of improvements in terms of scheduling. Besides, relocation of assets can also be optimised."

Both airlines should get over their national identities

Mohshin further stated in a The Edge Markets report that the airlines of both Singapore and Malaysia should "forget the national identity crisis" and look beyond representing their country:

"If the full-service carriers can get away from the mentality that 'I am representing my country', it will bring very good benefits for their businesses. That’s my firm view."

He added that once both carriers do so, they will be able to remove many costs and achieve greater efficiency.

Mohshin's organisation, Maybank Kim Eng, has clarified that his views do not represent the organisation's position.

Malaysia Airlines has been struggling

Malaysia Airlines has been in the red for a while now.

On March 12, Malaysian Prime Minister Mahathir Mohamad announced that the Malaysian government was contemplating shutting down, selling or refinancing the airline.  

Mahathir’s announcement came in the wake of a statement by aviation analysts that said the airline had become unsustainable after failing to meet its three-year target for profitability.

At that time, Mohshin also noted that the airline's turnaround plans had failed.

However, Malaysian Finance Minister Lim Guan Eng subsequently clarified that Malaysia Airlines will not be closed down, adding that Mahathir's comments were misconstrued.

On March 20, Mahathir said that selling the airline was still an option as there were a number of local and foreign parties who were interested in purchasing it.

As of May 1, Malaysia Airlines has applied to establish a commercial joint venture with Japan Airlines to cover all routes between Malaysia and Japan, CNA reported.

According to a FlightGlobal editor interviewed by CNA, this partnership with Japan Airlines could be a "lifeblood" for Malaysia Airlines.

The proposal by Malaysia Airlines is subjected to approval by both the Malaysian Aviation Commission and the Japanese transport ministry.

However, no timeline has been provided for the approvals thus far.

Here's what you need to know of Malaysia Airlines' potential fate:

Here's what Singapore Airlines is doing in Malaysia:

Top image collage from Malaysia Airlines Facebook and Singapore Airlines Facebook