Thursday, January 19, 2006

Malaysian Airlines, a disgrace to Malaysia




This makes me sick


Reading all the recent reports about our beloved airline has left me fuming mad. Mad at the bumbling fools who are running it, mad at the politicians who place national ‘pride’ (yea, pride my big, fat, Greek arse) above economic sense, and last of all, mad because there is nothing much the average person in the streets can do about it other than sit by and watch the company continue to suck our country dry.

I am sure you all remember MAS right? Our country’s dear national airline which, according to some survey, has the best cabin crew (but the worst everything else IMO). In fact, hundreds of years from now, if historians were to look up the word ‘Malaysian Airlines’ in their dictionary (or whatever book it is they refer to), they would most probably come across something like this:-
Ma-lay-sian Air-line (ar|n : MAS ) : 1) an incompetent airline in the 20th and 21st century which succeeded in wasting zillions of tax payers money, while at the same time enriching a certain ‘segment’ of Malaysian society.

Remember 2002?

I remember back in 2002, MAS did something which clearly demonstrates the sort of mindset which besets most of our GLCs. Basically, MAS lost loads of money in 2002, to the tune of RM836 million in the year ended March 2002. Sounds serious right? Not quite to the management of MAS because they could always rely on their sugar-daddy (the Government) to help them out.

In the end, they unveiled this grand-sounding plan called the ‘Widespread Unbundling Exercise’ or WAU for short. Via this plan, MAS effectively dumped all their domestic losses and losses relating to aircraft ownership to Penerbangan Malaysia Bhd, a government linked company (of course, what else?), allowing it to record a paper profit but sadly, not an operational profit.

This reminds me of what happened to me many years ago, when I was a wee little lad. It was during Chinese New Year, and flush with my ang pau collection, I began playing several rounds of blackjack with my uncles. Mind you, I was only like 5 years old then so my blackjack skill basically sucked. In the end, I lost RM1.

Instead of accepting that I sucked, and trying to improve my playing skills, I ran to my little old grandmother wailing and crying. She, being the kind granny that she is, offered to help her oldest grandson by reimbursing me the RM1. So basically, my loss of RM1 was transferred from me to my granny, leaving unchanged the fact that I was a crappy blackjack player.

This is exactly what the WAU exercise is all about. It’s the corporate equivalent of MAS running crying and sobbing to its sympathetic grandmother, ie our dear Government.


Fast forward to 2006


Nothing much has changed since then, MAS is still crappily run and losing money by the bucket loads. In the 2Q of 2005, MAS reported its second straight quarterly loss of RM367 million, bringing its total losses to around a kazillion jiggyllion ringgit.

What WERE the top dogs at MAS doing that resulted in such huge losses?

Ahh my young paedawan, we’re getting to the best part of this whole story.


Executive Perks at MAS

In spite of their terrible performance, MAS saw it fit to lavishly reward its Senior Executives. Rumor has it that MAS approved the spending of almost RM1 million to renovate the office of one of its ‘top guys’. Of course, it doesn’t matter to them right? After all, it’s not their money they are spending, it’s the Governments, and that basically means that it’s the tax-payers money.

Now once you’ve spent like a million bucks to renovate your office, you obviously need some lavish art pieces to go along with it right? You can't just hang any old picture which you've bought at a discount from Central Market. Well, the same dude who renovated his office also spent RM1.5 million on several paintings to hang on his wall so he can stare at it all day instead of doing anything remotely resembling work. Woo hoo, that's a lot of moolah.

You’d think that if your company was bleeding money, you would obviously try to tone down your taste a little. Nope, you wish. The people at MAS see nothing wrong with sucking their company and their country dry. After all, isn’t it their birth right?

Not only that, the word in the grapevine is that the Senior Execs have also been given a pretty sweet deal when it came to cars. According to this hair-brained scheme, MAS will pay, in cash, 75% of the price of any car of their choice for all Senior Execs. The remaining 25% will be loaned to them by MAS. Wow! Not only do you get to sit around the office all day staring at million dollar paintings, now you can roll about in a fancy set of wheels acting like you’ve earned it. What a great place to work! :P Is this what they mean by creating ‘towering malays’?

Wait wait, it gets better. MAS also allows its Senior Execs to have practically unlimited usage of its airplanes (you know, for those super-urgent appointments they have with a holiday resort in the Bahamas). Needless to say, this has been badly abused (why am I not surprised?). There has been word of a senior executive getting free 1st class flights to London for a day trip just to visit a female ‘friend’, and also of a senior exec booking an entire flight to send, get this, some dentistry equipment to a company in Europe which he has private business dealings with. And all this is done using our MONEY!

The papers recently talked about how much MAS was paying one of its CONsultants (it has around 17 ang moh CONsultants). This Ang Moh dude by the named of Chris Andrews was paid RM7,000 a DAY to ‘advise’ MAS on their IT Outsourcing needs. In the end, what this guy basically did was say “Ok, I think you should outsource to IBM”. Such a simple way to earn 7K a day hor. Never mind the fact that MAS’ IT costs grew three-fold after such 'valuable' advice. Chris Andrews was paid RM1.3 million a year for his ‘contributions’ *ahem cough* to MAS. How did he land such a lucrative job? The same way all the incompetent fools in high positions get theirs, through blatant cronyism and string-pulling.


How now brown cow?

The airlines top management announced a few weeks back that they will need RM3 billion ringgit to restructure their operations and to save MAS from extinction. Prime Minister Datuk Seri Abdullah Ahmad Badawi stated that the government will not bail MAS out, but they will extend any necessary assistance to help the airline to turnaround. Hmmm, doesn’t sound very promising to me. Does that mean that MAS will have another exercise like the one it did in 2002 (WAU)? Or will the government ‘loan’ them more money on extremely favorable (read: no need to pay back) terms?

Seeing as how MAS is still 69% owned by Khazanah, the investment arm of the government, I don’t see how political influences can be pushed aside so that the company can focus on improving itself commercially. The politicians kicked up a HUGE fuss when somebody merely suggested that we bring in a non-bumi to head the company (btw, Singapore is headed by a Malaysian Chinese). They accused people of selling out on their country, of compromising our status as an independent nation and bla bla bla.

If our national pride hinges on associating ourselves with a loss making, corrupt, badly managed, incompetent airline - then I think I’d rather do without it.

Give me prosperity over such farce-like pride anyday.

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15 Comments:

Blogger mooiness said...

Good post! I agree on all your points. Though I share some of your scepticism, I'm glad to see that they have sucked up their pride and are getting rid of their KL HQ and moving the operations closer to what they are suppose to be doing - the airports.

1:14 PM  
Blogger Bernard Yong said...

Yea, that was a pretty heartening move. Lets hope the new CEO Idris Jala can implement some sorely needed changes.

1:17 PM  
Anonymous SpyMy said...

Nice article, you've been Spyed!

4:09 PM  
Blogger DroolMAN! said...

Much of what you have said are really old news and the bits and pieces of the rumours and grapevine quotes originate from a very well known e-mail with the title, "MAS: A Flying Buffet" that has been widely read since November 2005 (I received my copy in late November).

As to your comment, "...there is nothing much the average person in the streets can do about it other than sit by and watch the company continue to suck our country dry."

There is something you and everyone can do. The next general election, make sure you do your civic duty to vote and when you cross that "X" on the ballot form, make sure it's anything but the dacing.

I don't understand why Malaysians moan and whine like a bitch about our government when we are the ones who elected the same old corrupted government to power. Remember the last election? 90% majority. And here we are blaming the MPs when we are the fools.

4:15 PM  
Blogger ::Lord Apprentice:: said...

hmm, droolman, perhaps it is the 10% that voted otherwise that are doing the moaning and whining.

4:47 PM  
Blogger Bernard Yong said...

droolman : Yea, I read the flying buffet mail which was circulated like mad. I read it quite some time back actually, its just that after awhile (and after reading all the recent reports in the papers on how bad MAS is doing), I thought I'd regurgitate some old stuff to reinforce my views (dig up old articles and emails :)).

I do vote for the opposition actually. Not that I think they have a chance of winning, it's just that it is always a good practice to have several parties holding seats so that they can keep checks on one another

5:50 PM  
Blogger Bernard Yong said...

Also, in the last election, a lot of people who normally voted for the opposition were spooked by the news of continued DAP-PAS cooperation. Hence the huge majority garnered by Barisan.

5:52 PM  
Anonymous Anonymous said...

i suppose another unbundling exercise is in the offing. sell everything and hire another airline as the subcontractor - it's very glocal and towering too.

any takers - garuda?

6:13 PM  
Blogger cccp said...

exactly. droolman, what other choice do we have? no doubt we have a shitty govment, but we also have a shitty opposition. we're basically doomed.

6:25 PM  
Blogger Bernard Yong said...

lordtick : I dont think having a 90% majority in parliament means that 90% of the country supports the ruling party. Each seat could have been won by merely a few votes, making it more of a 60/40 split. That scenario is just imaginary ler, but it could happen.

6:40 PM  
Blogger ::Lord Apprentice:: said...

yea, i know dude. was just trying to make a point. people are more likely to get it if its exxagerated a lil, eh?

Or maybe not..hehe

Now lets see...

MAS is heading towards total failure. So is Proton. Thank goodness for nasi lemak. Now if only we can find a way to market and export it to other countries.

8:30 PM  
Blogger mwt said...

It was MAS - Mana Ada System right from the beginning.

12:34 AM  
Blogger DroolMAN! said...

cccp: This is going a little off-topic but I think it covers the root cause of all our country’s woes.

I know that the likelihood that the Opposition were to win an election is non-existant but do we really have to give 90% majority to a bunch of people who will continue for another 5 years making themselves, their family members and cronies rich out of taxpayers' money?

Sometimes, I think the rakyat forgets that when we vote, we are giving permission to whichever party that we vote, the power to rule over us. Why do we then continue to give power to those that mismanage our beloved country?

It is unfair to call the Opposition "shitty". Through their respective blogs, I have come to be more aware of their activities and they do really work for the rakyat, Johns and Janes like you and me and they get very little thanks. They take on the hard, no-win cases where even MCA reps won’t even touch.

Because of their small numbers, the Opposition can't even oppose properly to some of the ridiculous decisions made by the majority party because they (the Opposition) are given the smackdown and then the shutdown before they can even go further.

And should I say that being the Opposition is a thankless job especially faced with ignoramus totalus comments like, “Malaysia ini negara Islam, you tak suka, you keluar dari Malaysia!”. Sometimes I wonder how these people continue on. I would have been broken spiritually and mentally.

If we are going to continuously have this "better the devil you know" attitude when electing a government, we are going to have to live with the sad fact that we are at fault. Unless we take back the power and show the government that we are the boss, we are going to see even more scandals in our lifetimes.

2:35 AM  
Anonymous Bujang said...

Poor management like many Malaysian companies. They manage the company due to personal preferences rather than business sense. The web site for U.S. Malaysian airlines was a joke until just recently. bcause management didnt want to market there. Shouldnt let politics influence business. Malaysia Boleh is fine for some things but international business we need to realize we can learn from other people and market where the money is.

11:01 AM  
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11:16 PM  

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