KUALA LUMPUR (Nov 14): Malaysia Airlines Bhd said today it had yesterday signed a memorandum of understanding (MoU) with the Ministry of Entrepreneur Development (MED) to implement a vendor development programme (VDP) which aims to cut cost attributed to non-critical parts by 15%.

In a statement, Malaysia Airlines said the VDP also aims to decrease turnaround time and boost operational efficiency.

"Malaysia Airlines will function as an anchor company and will support the programme by implementing VDP starting with engineering and maintenance and AeroDarat services. There will be five initial pilot projects for the VDP programme within Malaysia Airlines, mainly in sourcing additive manufacturing, carpets, seat upholstery, aircraft cleaning materials and chemicals.

"An additional benefit of sourcing locally would be that Malaysia Airlines would be able to decrease its exposure to foreign exchange volatility," the company said.

Malaysia Airlines group chief operations officer Ahmad Luqman Mohd Azmi said in the statement the company is already an important economic enabler for the country.

"By signing the MoU with MED, we are also able to create a multiplier effect within the domestic economy by developing an eco-system for local vendors to support their businesses.

"The VDP also helps to empower local companies to propel their businesses in Malaysia's airline industry, which is predominantly serviced by foreign companies," Ahmad Luqman said.