Malaysia Airlines begins new chapter with first A350 delivery

Malaysia Airlines has placed into service its first A350, implementing the first phase of its new widebody fleet strategy.


Summary:

  • Malaysia Airlines placed first A350-900 into service on short haul regional routes from Kuala Lumpur to Bangkok, Kota Kinabalu, Penang and Singapore in early Dec-2017.
  • The airline will use the type to replace its A380s on its Kuala Lumpur – London Heathrow route with a debut set for 15-Jan-2018.
  • The Asian carrier plans to grow its A350-900 fleet to six aircraft by Jul-2018 with four being used to serve the double daily London market.
  • Aircraft switch to London sees an overall 40% reduction in capacity as the 286 seat A350s replace the 486 and 494 seat SuperJumbos.

Malaysia Airlines’ first A350-900 was placed into service in early Dec-2017 and is temporarily operating short haul regional routes from Kuala Lumpur to Bangkok, Kota Kinabalu, Penang and Singapore. The airline plans to begin deploying the A350 to London on 15-Jan-2018, at which point it will have two of the type.

Malaysia Airlines committed to six A350s in 2H2015 and early 2016. All six aircraft are expected to be delivered by Jul-2018. The first four aircraft will be used to replace the A380 on the airline’s double daily London service in early 2018, resulting in an over 40% reduction in capacity on the Kuala Lumpur-London Heathrow route. First class capacity will shrink by 50%, and business class capacity by nearly 50%, while economy seat capacity will be cut by approximately 40%.

Malaysia Airlines configures its A380s with 486 or 494 seats, consisting of eight seats in first, 66 lie-flat seats in business and 412 to 420 economy seats. The airline’s new fleet of A350s will have 286 seats consisting of four first class seats, 31 lie-flat business class seats, and 251 economy seats.

Malaysia Airlines has gone back and forth multiple times on deployment plans for the final two A350s. The previous management team was considering a new long-haul route to Europe after deciding the A350 could not be profitably deployed on any regional routes within Asia Pacific. However, the new management team seems to have reversed that decision and use a portion of the A350 fleet on medium haul routes including Kuala Lumpur-Tokyo.

The new management team also seems to have reversed the decision by the previous management team to stop operating the A380 on scheduled services once the second London flight transitioned to the A350. Malaysia Airlines is now planning to use the A380 on some regional routes within Asia Pacific during peak periods of 2018. Malaysia Airlines still plans to eventually transfer the A380 fleet to a new charter airline, which intends to operate the aircraft in a higher density configuration on religious pilgrimage flights to Saudi Arabia.

The Malaysia Airlines fleet should not consist of any A380s by the end of 2018. In addition to the A350 deliveries, Malaysia Airlines is receiving six ex-Air Berlin A330-200s in 2018. These aircraft are essentially replacements for six 737-800s which exited the fleet in 2H2017.

Malaysia Airlines decided to acquire the A330-200s in Sep-2017 as a cheap interim solution for existing routes. The aircraft are only being leased for five years, at which point they will likely be replaced by 787-9s or A330-900neos.

Malaysia Airlines plans to put the first A330-200 into service in Feb-2018. The remaining five aircraft are slated to be delivered in 2Q2018 and 3Q2018. Malaysia Airlines already operates 15 A330-300s, which have a larger business class cabin and a more spacious economy class product with 32in pitch compared to the 30in on the ex-Air Berlin A330-200.

Malaysia Airlines also inherits from Air Berlin an extra legroom economy product on the A330-200, offering 44 economy class seats at 36in pitch. Malaysia Airlines does not currently have an extra legroom offering, but was already planning to introduce an extra legroom product on the A350 and A330-300 in 2018.

The delivery of the new A350s along with the upcoming delivery of second hand A330-200s and the phase out of the A380s mark a new chapter for Malaysia Airlines. While the airline is introducing two new aircraft types its fleet size will remain unchanged, since the six A330-200s are replacing six 737-800s and the six A350-900s are replacing A380s. Malaysia Airlines intends to end 2018 with a fleet of 75 passenger aircraft, which is the same number of passenger aircraft as the airline operated at the end of 2016.

While the number of aircraft remains unchanged, the mix of the Malaysia Airlines fleet is changing to reflect a higher concentration of widebodies. The proportion of widebody aircraft in the passenger fleet will increase from 28% at the end of 2016 to 36% at the end of 2018.

A higher widebody/narrowbody ratio is an important component of the airline’s fleet strategy, as there are several regional routes within Asia that are better served with widebody aircraft. Up-gauging these flights will result in more capacity, a reduction in unit costs and a better premium product.

Malaysia Airlines previously had a much a higher concentration of widebody aircraft. Before the start of its restructuring in late 2014 the airline operated a fleet of 91 passenger aircraft, with widebodies constituting 34 aircraft, or 37%, of the fleet.