How Malaysia Airlines might salvage its image
AP July 22, 2014, 12:02 am TWN
AP--Malaysia Airlines is in uncharted territory after the disappearance of Flight 370 in March with 239 people aboard was followed this week by the downing of another of its jets, carrying 298 people, over Ukraine.
Before the disasters the carrier had among the worst financial performance of any airline. An even bigger question mark now hangs over the future of Malaysia Airlines, with its brand tied to two almost unfathomable tragedies.
Some analysts say the state-owned airline won't survive a year without a substantial cash injection from the Malaysian government.
A bailout would address the airline's immediate financial problems but without far-reaching changes it could remain a burden on taxpayers and shrivel into regional obscurity.
Several experts give their views on the airline's crisis.
— How bad is the situation for Malaysia Airlines?
Other airlines have come back from disasters but none have experienced two tragedies of such magnitude within the space of four months.
"There's no historical precedent," said Mohshin Aziz, aviation analyst at Maybank. "It's completely not their fault, but right now if you ask any customers would they fly with Malaysia Airlines, they'd just have that negative sentiment of I'd rather choose something else."
The airline was already losing about US$1.6 million a day and has been in the red for the past three years. The disappearance of Flight 370 with many Chinese passengers on board also caused a backlash in the crucial China market. Experts don't see any short cuts to recovery.
"It cannot be a quick fix," said Aziz. "So the second question is do they have the financial resources to survive a year, two years? And the answer is, unfortunately, no."
— How should Malaysia Airlines handle the latest tragedy?
Clear, consistent and compassionate communications are essential, experts say.
"I think their immediate response has been consistent and caring. They are communicating on Twitter and Facebook, they are definitely going out on the commercial media," said Sapriel of CS&A. That's important, she said, because "if they weren't getting the immediate response right, then it just would be the nail in the coffin for them."
Others say that being open and transparent, continuing to assist the families of passengers and crew members while also running a punctual and reliable business will help the airline build on the sympathy about its plight.
Malaysia Airlines "appears to have learned lessons from its halting slowness to react to the MH370 tragedy and is already applying those lessons," said aviation consultant Robert Mann.
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