Malaysia Airlines' restructuring enters new phase with fleet & possible regional capacity reductions

Malaysia Airlines (MAS) has begun a new phase of its long restructuring process, as it starts to reject aircraft leases. MAS transitioned to a new company on 1-Sep-2015, but the restructuring in many respects is far from complete, and will take another year to implement.

MAS still has the flexibility to reject aircraft leases, giving it a benefit similar to US airlines that are restructuring through bankruptcy protection. While MAS cut capacity and head count prior to the transition to the new company, the flag carrier has only begun the process of reviewing its fleet.

A large portion of the fleet is expected to be returned over the next several months. More capacity cuts are possible, particularly in the domestic and short haul sectors, as MAS has already cut back its network outside Asia to a minimum level.