‘Bankrupt’ Malaysia airlines unveils recovery strategy

Malaysia Airlines is to cut 30 per cent of its workforce because it is “technically bankrupt”, its new chief executive has said.

Malaysian airlines plane
Christoph Mueller, who took over at the troubled airline in May, told a press conference that the airline had offered jobs to only 14,000 of its existing 20,000 workforce.He said the dual tragedies suffered by the airline last year – the disappearance in the Indian Ocean in March of Flight M370 and the shooting down of Flight MH17 over Ukraine in July – had been the final straws for a business already struggling."We are technically bankrupt," said Mr Mueller. "The decline of performance started long before the tragic events of 2014."Mr Mueller, who built up a reputation for cost-cutting and redundancies during previous spells in charge of Aer Lingus, Sabena and Lufthansa, said not all the staff offered jobs under new contracts might accept them."We will embark on a second round (of a review of staff numbers) in two weeks' time and that will allow others to accept our offers and that may change the numbers," he said.Mr Mueller said that the airline would announce the results of re-branding exercise in September but refused to say if he expected that this would lead to a change in name.He also refused to be drawn on whether or not Malaysia would withdraw from some long-haul routes to Europe but said it was possible the frequency of flights on certain routes might be reduced or smaller aircraft used.Mr Mueller revealed that, before deciding on the closure of any routes, Malaysia would open discussions with other airlines in the coming weeks over the possibility of operating them as joint ventures.In a statement, the airline said its immediate priority was to "stop the bleeding" in 2015, then to stabilise next year and start growing again by 2017.For more Re:locate news and features about business and enterprise, click here

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