Surprising: Malaysia Airlines To Order 8 Boeing 787s

Malaysia Airlines is trying to shrink their way to profitability. Following the catastrophic events of a couple of years ago (and the financial issues the airline already had before that), Malaysia decided to ground their entire fleet of 777s, and plans on soon taking their A380s out of service as well.

Malaysia Airlines will soon take delivery of six Airbus A350 aircraft, which will be their only ultra longhaul aircraft, and will replace the A380s on the London route. Furthermore, Malaysia has 15 A330-300s, though those planes don’t have the range to fly to Western Europe.


Qatar Airways A350

Thanks to some drastic cuts, Malaysia is on track to be profitable by 2018, and I figured they’d be happy trying to be a fairly small airline that isn’t bleeding money.

Well, it looks like the airline has loftier goals, as Bloomberg reports that Malaysian Prime Minister Najib Razak has said that the airline plans to order eight Boeing 787 aircraft during his US visit (which is happening right now). While that sounds like a sure bet, the airline is also considering doubling their Boeing 737 MAX order from 25 to 50 over the coming years, which seems like less of a sure bet.

This is an interesting move on their part for a variety of reasons. First of all, it shows that the airline once again wants to grow, rather than just remain small and lean. Hopefully they have a more sustainable strategy this time around, and they aren’t just repeating past mistakes. The fuel efficiency of new planes at least helps minimize the downside of operational losses a bit.

But the much more interesting move here is that they’re going with the 787. That means Malaysia Airlines will have six A350-900s and eight 787s (we don’t yet know whether they’ll be 787-8s or 787-9s). I guess it’s possible they want a plane that’s a bit smaller than the A350-900, though at the same time there are increased costs to operating an inconsistent fleet, in terms of aircraft utilization, crew training, maintenance, etc.


Royal Jordanian 787

Arguably this could also be viewed as a political move, given that this comes at a time that Malaysia’s PM meets with President Trump, before he is rumored to call for early elections in his country.

What do you make of Malaysia Airlines’ order of eight 787s?

Comments

  1. I would imagine this is at least in some part political given the timing of his visit and other political issues in the world (e.g. Malaysia trades with North Korea and could be a target of further sanctions in future UN resolutions)

  2. they have too much national pride and ego to let themselves go to a small scale “lean-n-mean” carrier the way Aegean or Alaskan is. they spent millions hiring consultants to fix their image and the final outcome was no name change, no branding change, and pretend nothing has happened.

    and despite being in oneworld, they’re hardly reaping the benefits of membership but still have to pay all the costs associated with being a member of the club.

  3. Airbus / Boeing combination is becoming a common strategy. Airlines have learned that price bargaining is more difficult if they devote to one manufacturer. By playing both cards, airlines can bargain on future aircraft “orders”.

  4. That Jordanian 787 photo made me think of Trump’s Boeing 757. I looked far too quickly and then realised my error!

  5. They’ve always had sort of an inconsistent fleet. There was never really a reason they couldn’t have gone all 777 in the 90s and mid 2000s instead of the 777/A330 mix.

  6. If you look at Malaysian Airlines history this is just par for the course. The airline is far more about politics than any sort of profitability or business model. Its why Christoph Mueller left in frustration. (Remember that 747 they pulled out of drydock and never used?)

    I actually loved flying them in the 90’s and 2000’s for that reason and still fly them today with some decent results. The FA’s are usually super friendly, in a more genuine way than the still excellent but scripted/fake Singapore Airlines crews. The food is also very very good if you love spicy meals. The flights are also never 100% booked in business and first. They have a really easy to use bid-to-upgrade policy that allows you to snag some good seats for pennies on the dollar.

    That being said buying 787’s is a complete shit move. Its pandering to Trump with hopes that the U.S. wont pursue its 1mdb investigation. Given Trump’s quid-pro-quo I would say it is certainly worth a chance.

    For those not in the know $12 billion USD is missing from the One Malaysia Development Bank (1mdb) and likely in Najibs pockets. The FBI has seized assents from what they call “Malaysian Official 1”, which the WSJ and NYT says is Najib. In addition even Leo Dicaprio has been dragged into it as “The Wolf of Wallstreet” was partially funded by the stolen money. He was also given a Marlon Brando Oscar and a Picasso painting which he returned after learning they were bought with money stolen from 1mdb. In addition 7 foreign governments are investigating it due to money laundered through them.

    So it is 100% a ploy by Najib.

  7. Malaysia is situated next to Indonesia and the apple doesn’t fall far from the tree. We all know how hospitable and nice Garuda Airlines is. I’m flying Malaysia Airlines business class next week and the expectations are high because I’ve only flown American Airlines.

  8. @Datuk Lanun that was actually an interesting read! thanks for informing us about stuff we probably wouldn’t know otherwise.

  9. @ justin h:
    Hi Justin, I would like to share some thoughts with you due to your high expectations for MH.

    I regularly fly either Garuda or Malaysia in the region since I moved to Jakarta 4 years ago.

    I do MH because I get the miles and points for QR where I am Platinum; but definitely prefer GA and not because of nationalism since I am expat, simply because they are fantastic. And the 4 years in a row title of World’s Best Cabin Crew, very well deserved!

    If GA were Oneworld instead of SkyTeam, I would be the happiest man on earth: QR for long haul and GA for region and Asian flights.

    Anyway, back to topic: MH crew and service, both are very good, either way.
    I do not know which flight you are doing on MH: if it’s short regional or long haul (e.g SYD on 333 or LHR on 380).
    If it’s short haul and under 3 hours, forget about any alcohol; but if longer or long-haul, then they serve it. The food in any flight will be OK, obviously much better on the long haul when they start the big meal with the satay service, which is unbeatable.

    In any short haul or regional, you will be on a 737-800, which in Biz is 2-2 in 4 rows. The seats are comfortable enough for short distances and the entertainment is ok.
    If you do any flight on 333, they have a quite new Biz Class (I guess since a couple of years) which is very nice. Definitely there go for the individual seats, unless you are flying with someone else.

    I have flown Business on their 333s (and even before on their 772s) many times to Australia and 737 regionally, and very happy with the results (as I said, many times opted for MH due to the QR miles/points). (But many times devote my love to Garuda, which is the best).

    Hope this helps to set your expectations about MH flight.
    Cheers, Alejandro

    .

  10. Boeing order and staying at Trump Tower. It’s just a political ploy. Najib knows he can’t influence Trump but meeting him burnish his image and credibility to the audiences at home. I would say it’s a “meeting of great minds”

  11. I dont see whats the issue. Makes sense for long and thin routes like KUL-CDG or AMS and flexible enough to deploy for SYD and AKL routes or high demand Indian subcontinent routes. Maybe help cover the A350s during D Checks for flights to LHR even. MH was never gonna be a true regional only player- theyre far too ambitious for that. This was just a rationalisation move to get it back to sound operating practices before expanding.

    MAS has always deployed a mixed fleet of Airbus and Boeing for mid to long haul (think A330s and 777s for Aussie flights) I think most carriers do as it keeps manufacturers on their toes. I dont fly MH anymore but it does seem to be strategically sound.

    As for the timing, well building up goodwill while youre on home turf is not undocumented- why not?

    Id prefer the A350 for its quietness and wider body, but I do see the point of a mixed fleet.

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