Malaysia Airlines: in search of a sustainable business model

Abstract

Subject area

Strategic Management/General Management.

Study level/applicability

MBA/Executive MBA.

Case overview

Malaysia Airlines (MAS) was incorporated in 1937 to operate in Singapore, Kuala Lumpur and Penang. The first period of crisis was witnessed in 1997/1998 due to the Asian Financial Crisis, MAS reported RM 260 million in losses. The airline recovered from the loss and reported profit of RM 461 million in 2004. However, it experienced another loss of RM 1.25 billion in 2005. This lead to implementation of the Business Turnaround Plan 1 in 2006. The Business Transformation Plan 2 was announced in 2008, but the period of losses hit the airline again in 2011. Overall, MAS has witnessed continuous cycle of losses and profits. Despite the turnaround efforts, the airline does not seem to be recovering; is there a safe landing for the troubled airlines?

Expected learning outcomes

The case can be used to illustrate economics and complexities of aviation industry, different business models existing in airline industry, quantitative and qualitative aspects of a turnaround strategy, failure to sustain turnaround efforts, and predicting the future scope for a player in airline industry.

Supplementary materials

Teaching Notes are available for educators only. Please contact your library to gain login details or email support@emeraldinsight.com to request teaching notes.

Citation

Tiwari, S.R. and Kainth, J. (2014), "Malaysia Airlines: in search of a sustainable business model", , Vol. 4 No. 7. https://doi.org/10.1108/EEMCS-03-2014-0069