Malaysia Airlines (MAS) may have its first non-Malaysian chief executive when it begins restructuring next year, with speculation pointing to outgoing boss of Irish airline Aer Lingus, Mr Christoph Mueller, as the man to take over the troubled flag carrier.
Reports yesterday said a foreigner was among three shortlisted by sovereign wealth fund Khazanah Nasional, with one saying Khazanah had already earmarked the German aviation veteran months ago. Khazanah said yesterday that "at this point in time, no person has been appointed as the new CEO of MAS and the search is still ongoing".
Under Khazanah's plan to rescue ailing MAS, which has suffered the loss of two Boeings this year and six consecutive quarters in the red, the airline will be delisted by the end of the year before being injected into a new holding company in July next year, after debt has been reduced mostly by swapping for equity.
Mr Mueller joined Aer Lingus in 2009 and presided over immediate capacity and job cuts. He returned Ireland's second largest airline - after low-cost airline Ryanair - to profitability in 2010, after losing a combined €240 million (S$386 million) in the previous two years. The progression is what Khazanah hopes to achieve for MAS prior to a relisting scheduled to take place by 2020. But analysts expressed concern that the Irish outfit with 4,000 employees operates in a completely different landscape from MAS'.
"Success here depends not just on him, but on other factors, including the ASEAN open sky policy next year and intricate politically linked issues," Mr Shukor Yusof, founder of aviation consultancy Endau Analytics, told The Straits Times. "There are a handful of Malaysians who have the relevant experience and know-how to do the job. Most of all, if I were one of MAS' 20,000 employees, I'd wonder why not a single one of us is considered capable to manage the company."
MAS is the subject of much public attention as a flagship government-linked corporation, with various parties pulling it in different directions, including a powerful union that has scuppered previous attempts at turnaround plans.
Several attempts to turn MAS, which has rarely been profitable since the 1997 Asian financial crisis, into a sustainable operation have failed after questionable business decisions, including lopsided contracts such as the 25-year RM6.25 billion (S$2.5 billion) in-flight catering deal handed to Brahim's, controlled by the brother of former prime minister Abdullah Badawi.
The government plans to enact legislation to allow MAS to break such deals, while the carrier slashes 6,000 jobs - but both moves are set to come under intense scrutiny. The airline, which has lost RM5 billion since 2011, is labouring to recover from the shooting down of MH17 over Ukraine in July, just four months after MH370 vanished en route to Beijing from Kuala Lumpur.
This article was first published on Oct 8, 2014.
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