Healthy Competition is GOOD

I had the inspiration to blog about this after reading Keith’s blog and after hearing Datuk Seri Idris Jala's message each time I sign out from Hotmail…(Credit given to the author of The Journals.blogspot.com -hope it's enough to save me from any charges pressed against me by the author!!)

Our national carrier, Malaysia Airlines (and its wholly-owned subsidiary, FireFly), had just launched its newest promotion: Everyday Low Fares.

1,000,000 free seats.
Fly from KL to Kuching (one way): RM0*
Book only at www.malaysiaairlines.com
Book early. Book online. No refunds. Fly 5-star!
Booking period: 5-19 May, 2008.
Travel period: 10 June, 2008-14 December, 2008.
*The above Economy Class fares EXCLUDE YSQ charges (fuel surcharge, administrative fee and airport tax), insurance levy and etc. Fares not available during peak periods. T&C apply…..

Your eyes are not deceiving you. This is not taken from an AirAsia advertisement. It (the words, I mean) is taken from the Malaysia Airlines (hereinafter referred to as MAS) advertisement in the 6th May, 2008 copy of Borneo Post, page 5. YES, our once-ailing national carrier, MAS, is now offering 1,000,000 free seats which includes the usage of the aerobridge, meal and etc. Remember that MAS does not charge any check-in baggage fee. It's AirAsia which charges the baggage fee of RM3 per bag (for online check-in) and RM5 per bag (for airport check-in). So you DO NOT have to pay any check-in baggage fee (that is if your check-in luggages do not exceed 20kg!)

Gone were those days when they could charge premium ticket prices, yet render poor service to customers and still survive. Gone were the days when they didn’t really have to improve their service even if it is under performing relative to other airlines.

Okay, to give MAS some credit: I redeemed MAS had played an important role in contributing to Malaysia’s economic and social integration. The company is currently operating the "loss-making" Rural Air Service (RAS) within Sabah and Sarawak through MasWings. I think this is indeed essential for social and economic development. MasWings took over this route from Fly Asian Xpress which gave it up after operating for around a year or so.

Credit goes to Datuk Seri Idris Jala, the revolutionary Managing Director and CEO of Malaysia Airline System Bhd, who took over the ailing airline on December, 2005 and later implemented the Business Turnaround Plan on 27^th February, 2006. The plan was aimed at cutting losses from RM1.7 billion (full year) to RM620 million in 2006, achieve a profit of RM50 million in 2007 and a record profit of RM500 million in 2008.

[I know some people will say that MAS is copying AirAsia's strategy of selling those seats that would otherwise remain empty and etc. So to be fair, I shall say that in reference to this case of MAS' low-fare offer, AirAsia is the market leader and MAS is the market follower. Anyway, there's no rule saying that one can't become a market follower, right??]

Then on 27^th February, 2008, it was reported that Malaysia Airline System Bhd confirmed its turnaround with a record net profit of RM851 million for the financial year ended 31st December, 2007.

And again, credit is given to that Sarawak interior-born Datuk Seri Idris Jala, for MAS' turnaround– all based on accountability, transparency, hard work and thrift... An example of a transformational leader.

….Gone were the bleak days when Malaysia Airline System (MAS) reported an abysmal loss of over RM1.3 billion while other airlines reported strong profits.

Yesterday, we were greeted with the news that AirAsia would come out with two new initiatives:
> AirAsia will pay the difference to any of his passengers if they can find any MAS airfare that is lower than the cheapest offered by AirAsia.
> A sub-Zero Fare campaign. Quoting Dato’ Tony Fernandes, “As for the sub-Zero Fare, which will be launched in the next few days, it will be cheaper than zero.”.

*WOoooooOT*…
Healthy competition is GOooooOD……

I strongly welcome it AS A CONSUMER. (but not IF I am another airline operator in Malaysia!!!).

Time for stimulus generalisation and stimulus discrimination???

.......Gone were the days when our Malaysian aviation industry was monopolized by one airline only.

And to give credit when credit is due, here's a THANK YOU to the CEO of AirAsia Berhad, Dato’ Tony Fernandes, for bringing AirAsia into operations....

However, I do not know whether this is a one-off marketing tactic for both airlines.... I hope it's a strategy instead. Anyway, Datuk Seri idris Jala has said that MAS is still making money from charging low fares. and Like what Sen Ze said, regular advertisements in mass media that advertise unbelievably low ticket prices is a great way to generate word-of-mouth publicity.

May Malaysia Airlines: the symbol of our national sovereignty, and AirAsia: the No.1 budget airline in Asia, be preserved without sacrificing efficiency.