KUALA LUMPUR (July 23): Malaysia Airlines Bhd said it will not speculate on the market value of used Airbus A380-800 aircraft at a time when its parent company Malaysia Aviation Group Bhd is conducting an open tender for the sale of six units of such aircraft to mitigate the financial impact of Covid-19-driven movement restrictions, which have brought the global aviation sector to its knees.
In a statement to theedgemarkets.com, Malaysia Airlines said: “The airline has, however, given various options to prospective buyers under the tender exercise, which is expected to be completed in 4Q21 (the fourth quarter of 2021).”
Malaysia Airlines did not elaborate.
The statement by Malaysia Airlines was in response to questions concerning matters including the price of a used Airbus A380-800 aircraft which is estimated at less than US$100 million
(about RM422 million) each compared to the list price of more than US$400 million each.
Malaysia Aviation Group via MAB Pesawat Sdn Bhd is conducting the open tender for the sale of the six Airbus A380-800 aircraft and their components, according to Malaysia Airlines’ recent LinkedIn post.
Malaysia Airlines said in the post that MAB Pesawat invites interested buyers to send their proposals and indicate their interest to participate in the open tender by 12 noon on Aug 12, 2021.
Following news of the open tender, news reports, quoting experts, reported that the value of a used Airbus A380-800 aircraft, which can carry more than 500 passengers, is estimated at less than US$100 million each compared to its list price of more than US$400 million each.
"A cash-strapped airline is taking an unusual approach to offloading its fleet of A380 planes, which each have a US$400 million price tag.
"The move comes as Malaysia Airlines seeks to recover from the massive hit to revenue caused by the Covid-19 pandemic,” news.com.au reported yesterday.
Aircraft manufacturer Airbus SAS claimed on its website that the A380-800 aircraft is a modern icon that has flown over 500,000 revenue flights carrying over 190 million passengers.
This includes more than 300 commercial flights per day, which take off or land around the world every two minutes, according to Airbus.
"Flying with the A380 is a unique experience that introduces passengers to new standards of in-flight comfort from first class to economy. As the world’s largest and most spacious passenger aircraft, its cabin allows travellers to stretch out in the widest seats in a calm and relaxing environment.
"With the unparalleled freedom it gives passengers to move about the aircraft, it’s no surprise that the A380 is a favourite in all cabin classes,” Airbus claimed.
Malaysia Aviation Group group chief executive officer (CEO) Captain Izham Ismail was reported to have said that Malaysia Aviation Group was looking to dispose of its Airbus A380-800 fleet, following completion of Malaysia Airlines' debt restructuring.
Reuters reported on July 15 that Izham, who is also Malaysia Airlines' group CEO, said Malaysia Aviation Group was convinced that the fleet did not fit the group's future plans as the group "restrategised to position its business as a global travel group”.
The country's sovereign wealth fund Khazanah Nasional Bhd owns Malaysia Airlines via Malaysia Aviation Group.
In a statement on March 4 in conjunction with the Khazanah Annual Review 2021 event, the sovereign wealth fund said that as the sole shareholder of Malaysia Aviation Group, it will continue to provide full support and close cooperation in comprehensive efforts to ensure Malaysia Airlines' sustainability after the pandemic.
"On Feb 22, the High Court of Justice in England and Wales sanctioned a scheme of agreement between Malaysia Aviation Group’s leasing entity MAB Leasing Ltd and the majority of Malaysia Aviation Group’s aircraft operating lessors, following unanimous support from the lessors.
"This represents an important component of the wider restructuring exercise, which will achieve a reduction in Malaysia Aviation Group’s liabilities of over RM15 billion. Moving forward, Malaysia Aviation Group will focus on working closely with the government and stakeholders on restarting air travel and promoting industry recovery, as well as continuing cash conservation while capturing demand recovery as part of its internal restructuring," Khazanah said.