Up to RM1.2b cost savings for MAS and AirAsia

PETALING JAYA: The collaboration forged between Malaysia Airlines (MAS) and AirAsia Bhd on Tuesday can turn in up to RM1.2bil in cost savings for both the airlines, said MAS newly appointed executive director Mohammed Rashdan Mohd Yusof.

“We have already identified savings in the area of procurement, but I cannot tell you exactly where now ... but the capital expenditures are large. We have basically looked at a very detailed study done by Bain & Co and there are many areas where we can cooperate and save,'' he said in an interview with StarBiz yesterday.

Though these are preliminary figures and Rashdan's figures are a bit conservative, others are more bullish to say the cost savings could be as high as RM1.6bil.

An area that MAS will focus on to save cost is in aircraft purchases, engines, spare parts purchasing. These are big ticket items and AirAsia boss Tan Sri Tony Fernandes and his partner Datuk Kamarudin Meranun have the expertise and bargaining clout and “savings culture'' which MAS could leverage upon.

Another area is on training where both can collaborate and reduce redundancies to save cost.

“There are so many areas of collaboration like joint training and take the example of the A330 aircraft, both of us have simulators and facilities. Why can't we share the simulators and facilities and save the cost. We can work together on shared services and even share best practices, so there are a lot of areas of opportunities,'' he said.

He also revealed that the exco meeting chaired by MAS chairman Tan Sri Md Nor Yusof met for the first time yesterday morning.

“All of the shares crossed today (yesterday) and the board members crossed today. They (Fernandes and Kamarudin) joined our board and I and Datuk Azman Yahya joined the AirAsia board. Today they got grips of MAS as before this the new shareholders never saw the inner workings of MAS. We discussed about where we are now and there were also some discussions on the future strategy,'' he said.