Malaysia Airlines confirms 6,000 job losses in restructure; CEO says carrier 'technically bankrupt' 
 
 Posted 
 
 Malaysia Airlines has outlined plans for a major restructure that will see the carrier slash around 6,000 jobs as it struggles to stay in business. 
 
 The plan, released on Monday by email, said the airline would begin operations under a new brand on September 1. 
 
 About 14,000 of the roughly 20,000 existing employees are expected to receive offer letters to remain with the restructured airline, it said. 
 
 Malaysia's national carrier is also expected to pull back drastically from unprofitable long-haul routes such as to Europe, and focus instead on regional traffic as it regroups. 
 
 The announcement marks the first concrete move by newly-appointed CEO Christoph Mueller as he seeks to repair the embattled airline's reputation following the loss of two jets in separate disasters in 2014. 
 
 "We are technically bankrupt ... the decline of performance started long before the tragic events of 2014," Mr Mueller said, speaking at a news conference. 
 
 In March of last year, flight MH370 disappeared with 239 passengers and crew aboard and remains missing. 
 
 Four months later, flight MH17 was destroyed by a suspected ground-to-air missile over Ukraine. 
 
 The tragedies were the final straw for an airline that analysts say had already been poorly managed for years, slipping further into the red. 
 
 Mr Mueller was making his first public appearance as CEO since being hired last month by the carrier's owner, Malaysian state fund Khazanah, to lead the restructuring. 
 
 The state investment fund said last year that around 6,000 jobs would be lost. 
 
 Monday's announcement said the airline planned to "stop the bleeding" in 2015, stabilise next year, and seek to start growing again by 2017. 
 
 Analysts have long blamed the airline's failure to compete on poor management, unwise business decisions, government meddling, and unfavourable service and supplier contracts stemming from Malaysia's crony capitalism. 
 
 The blueprint called for the renegotiating or resetting of major contracts, and a major revitalisation of technology, training, and business operations. 
 
 Mr Mueller warned last month a major overhaul was necessary as the airline was weighed down by "uncompetitive cost levels" that he said were 20 per cent higher than its rivals. 
 
 AFP 
 
 Topics: air-transport, business-economics-and-finance, air-and-space, disasters-and-accidents, malaysia, asia ||||| Image copyright Elvis Image caption The restructuring comes after years of losses and the twin disasters of MH370 and MH17 
 
 Malaysia Airlines is "technically bankrupt", its chief executive has said, as he announced a restructuring programme and plans to cut about 6,000 jobs. 
 
 The announcement follows the twin air disasters which forced its nationalisation last year. 
 
 The airline said it had "offered jobs" to 14,000 of its 20,000 workforce. 
 
 The move was expected and follows the appointment of new chief executive Christoph Mueller in May. 
 
 "We are technically bankrupt," Mr Mueller told a news conference. "The decline of performance started long before the tragic events of 2014." 
 
 The airline is operating as normal and no flights are currently affected. 
 
 In March last year, Malaysia Airlines flight MH370 disappeared with 239 passengers and crew aboard. The plane is still missing. 
 
 Four months later, flight MH17 was shot down by a suspected ground-to-air missile while in Ukrainian airspace, with the loss of 298 passengers and crew. 
 
 The two disasters proved to be the final straw for the already struggling business, which had reported losses for several years as a result of strong regional competition. 
 
 Image copyright Reuters Image caption Flight MH370 went missing in March last year 
 
 Rebranding 
 
 Mr Mueller was making his first public appearance as chief executive since being hired by the carrier's owner, Malaysian state fund Khazanah, to lead the restructuring. 
 
 He has previously had senior roles at Ireland's Aer Lingus, Belgium's Sabena and Germany's Lufthansa airlines. Famed for slashing jobs at the airlines, he has earned the nickname "the Terminator". 
 
 Analysis: Jennifer Pak, BBC Malaysia correspondent: 
 
 For more than a decade, Malaysia Airlines lurched from one restructuring to the next, but it was hard for many Malaysian taxpayers to understand the extent of the problem. 
 
 In-flight service remained one of the best in the region and up until the twin tragedies of MH370 and MH17, the carrier had a good safety record. 
 
 The new chief executive, Christoph Mueller, detailed the structural issues today. 
 
 For example, he said Malaysia Airlines management staff were spread out across more than 12 buildings, which meant departments were spending a lot of time to communicate with each other. 
 
 He also stated that the airline was "technically bankrupt". 
 
 Mohshin Aziz, an aviation analyst at Maybank, told the BBC that no management official "had the balls to admit that" in the past. 
 
 He said the slashing of a third of the work force was a promising sign of real change. 
 
 But Mr Mueller doesn't have much time to revive Malaysia's national icon. 
 
 British Airways, for example, recently restarted flights from London to Kuala Lumpur, which is Malaysia Airline's flagship route. 
 
 I recently flew that route and had a row of four seats to stretch my legs. The staff told me there were plenty of empty seats in the double-decker Airbus A380 aircraft. 
 
 Malaysia Airlines faces stiff competition from legacy carriers, as well as low-cost carriers, such as AirAsia X. 
 
 Malaysia Airlines had previously disclosed plans to cut 6,000 jobs, shrinking its workforce to 14,000. 
 
 Mr Mueller said the airline could not expect that all of the job offers it had made to existing staff would be accepted. He said this was because the company expected staff to have received offers from rival carriers. 
 
 "We will embark on a second round in two weeks' time and that will allow others to accept our offers and that may change the numbers," he added. 
 
 Image copyright Reuters Image caption Flight MH17 came down near the village of Grabove in Ukraine 
 
 Malaysia Airlines plans to announce a rebranding on 1 September. Mr Mueller would not be drawn on whether this would mean a change to its name, but said "all constellations were open". 
 
 He admitted that in certain markets Malaysia Airlines was a tarnished brand, but he would not say whether the rebrand would involve a change in name, logo or other alterations. 
 
 He also would not be drawn on whether the airline would withdraw from some costly long-haul flights to Europe. 
 
 In more general terms, he said it was possible the airline might reduce the frequency of flights on certain routes, or reduce the size of aircraft on those routes. 
 
 The carrier would look at joint ventures before closing routes, Mr Mueller said, and would be having conversations with potential partners in the coming weeks. 
 
 The airline considered long-haul flights to and from London to be among its flagship routes, he said, so would not be altering them. 
 
 In a statement, the airline said its immediate priority was to "stop the bleeding" in 2015, then to stabilise next year and start growing again by 2017. ||||| Malaysia Airlines will have a rebrand in September after a disastrous 2014 
 
 The new boss of Malaysia Airlines has claimed the carrier is "technically bankrupt", following two plane accidents in 12 months. 
 
 Christoph Mueller has confirmed that 6,000 jobs will be cut at the troubled airline - ahead of a rebrand in September which aims to repair the damage caused by the losses of MH370 and MH17. 
 
 CEO Christoph Mueller has turned around other airline brands in the past 
 
 Consumer confidence was badly affected when Flight MH370 disappeared with 239 people on board in March 2014, and just four months later, Flight MH17 was downed by a suspected ground-to-air missile over Ukraine - killing 298 people. 
 
 The tragedies led to Malaysia Airlines being taken into state ownership and delisted from the stock market, but analysts claim the company has been mismanaged for years - a sentiment echoed by Mr Mueller. 
 
 Play video "2014: Can Malaysia Airlines Endure?" Video: 2014: Can Malaysia Airlines Endure? 
 
 "The decline of performance started long before the tragic events of 2014," he said. 
 
 Stiff regional competition has led the company to post losses for several years - and in a statement, the airline pledged to "stop the bleeding" in its finances by the end of 2015, in the hope it will return to growth by 2017. 
 
 Mr Mueller, nicknamed The Terminator in Ireland for the job cuts he implemented at Aer Lingus, is expected to reduce the number of long-haul routes offered from Malaysia to Europe, and focus on regional services. 
 
 However, a "profitable" twice-daily service from London Heathrow to Kuala Lumpur is set to continue. 
 
 Under the new CEO's plans, Malaysia Airlines' workforce would shrink to 14,000. 
 
 The challenges facing the company come amid low jet fuel prices, which are expected to make this year one of the most profitable for the industry since the start of the century. 
 
 It is expected that the 12-month restructuring plan for Malaysian Airlines will cost £1.1bn - and last week, an administrator was appointed to oversee the transferral of the carrier's assets to a new company. 
 
 Mr Mueller said it was "business as usual" despite the disruption - and told passengers all reservations would be honoured, with scheduled flights going ahead as planned.
– The promised overhaul at Malaysia Airlines has begun. New CEO Christoph Mueller—dubbed "the Terminator"—says 6,000 of 20,000 jobs at the "bleeding" airline will be slashed. "We are technically bankrupt," says Mueller, who developed a reputation for laying off workers during restructuring at Ireland's Aer Lingus, Belgium's Sabena, and Germany's Lufthansa airlines, per the BBC. "The decline of performance started long before the tragic events of 2014." Before MH370 disappeared and MH17 was shot down over Ukraine, the airline suffered from what AFP calls "poor management, unwise business decisions, government meddling, and unfavorable service and supplier contracts stemming from Malaysia's crony capitalism." Though 14,000 workers were offered jobs, Mueller says some may be fielding offers from competitors. Noting the Malaysia Airlines brand has been blemished in some markets, Mueller, hired last month by state investor Khazanah, adds the airline will rebrand in September, but he remains vague on the details. The airline may also reduce the frequency of flights or the size of aircraft on long-haul routes to Europe to focus more on regional flights, though a flagship route to London will be unaltered. The hope is that the airline can "stop the bleeding" in 2015, per today's announcement, and see growth by 2017. Sky News reports the yearlong restructuring plan will cost $1.7 billion.