KUALA LUMPUR, Aug 19 ― In a bid to drive up ticket sales, ailing flag carrier Malaysia Airlines (MAS) has offered to temporarily increase the sales commission offered to Australian travel agents to almost double the original rate.
MAS, which is still struggling to recover from two recent air disasters that claimed the lives of over 50 Australians, is reportedly giving an 11 per cent commission for all tickets issued for its flights from Australia.
The 11 per cent commission could translate into hundreds of Australian dollars in earnings for travel agents from the sale of a single return trip alone.
This new commission rate will apply to all cabin classes but will end on September 15, a report by News Corp Australia said.
But for flights taking off from places outside Australia, the usual commission rate of six per cent will apply, the report added.
Australian travel agency Flight Centre’s Haydn Long did not find the increase in commission unusual for airlines, however, noting that certain bookings with MAS have been affected by its still-missing Flight MH370 and the downed Flight MH17.
“You would have to assume Malaysia Airlines is trying to reinvigorate interest in its flights out of Australia, in the wake of those two terrible tragedies (the missing MH370 and MH17),” he was quoted saying in the same report.
On March 8, Flight MH17 went missing with 239 people on board and has yet to be found despite months of searching in the southern Indian Ocean.
The Australian authorities are now still coordinating search efforts over the vast ocean swathe just southwest of Perth.
Months after the MH370’s disappearance, news hit the headlines that yet another MAS plane has been involved in tragedy.
On July 17, the Flight MH17 carrying 298 people was shot down when flying over a conflict-torn zone in eastern Ukraine.
After both disasters, the already-struggling national carrier found itself on the near brink of financial collapse.
Earlier in its first quarter filing to the Malaysian bourse, MAS reported losses of RM443 million. It also admitted that MH370’s disappearance “had a dramatic impact on the traditionally weak first quarter performance”.
In the same period last year, the airline lost RM279 million.
MH370’s disappearance hit the carrier’s China market the most as the Boeing 777 plane had been ferrying 153 Chinese nationals among the 239 people on board. Some 60 per cent of its China ticket sales was lost.
This February, MAS announced a worse-than-expected fourth quarter result for 2013 that saw it rack up another RM343 million in losses, putting the airline RM1.17 billion in the red for the entirety of 2013.
In 2011, it chalked up a record loss of RM2.5 billion.
Analysts sounded warning bells immediately, and began increasingly raising the prospect of a bankruptcy or heavy restructuring of the group to stave off the looming disaster.
On August 8, shortly after MH17’s downing, the government’s investment arm Khazanah Nasional ― also the majority shareholder of MAS ― offered RM1.4 billion to buy out all the minority shareholders and privatise the airline.
Khazanah Nasional said it would need six to 12 months to completely overhaul MAS, with a final restructuring plan to be unveiled at the end of this month.
