Malaysia Airlines: Complete brand makeover, new investors, new routes?

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Written by Linda Hohnholz

Malaysia Airlines may not be called Malaysia Airlines soon. The Malaysia government may not be the majority owner.

Malaysia Airlines may not be called Malaysia Airlines soon. The Malaysia government may not be the majority owner. New investors are possible and a complete brand makeover likely, a name change and more may be on the horizon. This is of course after the recent backโ€“to-back tragedies of MH17 and MH370.

Restructuring would come with a responsibility of 20,000 staff. It may also involve new flight routes for the 50,000 passengers it serves daily. Since the two tragic crashes, the company has lost 35 percent of its value, but the airlineโ€™s commercial director is convinced it will โ€œemerge strongerโ€.

โ€œOur majority shareholder, the Malaysian government, has already started a process of assessing the future shape of our business and that process will now be speeded up as a result of MH17,โ€ the companyโ€™s commercial director, Hugh Dunleavy, told the UK based Telegraph.

The airline is controlled by the Malaysian government through its sovereign wealth fund Khazanah Nasional Bhd, which owns a 69.4 percent stake.

Between the bizarre disappearance of Flight 370 in March and the shooting down of Flight 17 over Ukraine , the airline has seen 597 fatalities for the year, more than double the total for all the worldโ€™s commercial airlines last year.

Passengers are worried about safety, and investors are worried about profitability. Bloomberg News reported that the company needs at least $629 billion in the next year to stay afloat.

The share price had already been losing altitude before the two incidents in a four-month period. Before flight MH370 mysteriously disappeared, the carrier had seen its stock price fall more than 80 percent in five years. Passenger numbers are down and cash on hand is low.

It has been reported that the Khazanah group had planned to take the airline private, and other sources suggest private investment could come from rival airlines, like Singapore Airlines and Thai Airways.

About the author

Avatar of Linda Hohnholz

Linda Hohnholz

Editor in chief for eTurboNews based in the eTN HQ.

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