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MAS offers a million free seats
M'sia's largest airline adopts budget carrier marketing tactics
FROM July, you can fly to Malaysian hotspots including Langkawi, Penang and Kuching for free if you are among the first 30 per cent to book flights through Malaysia Airlines' (MAS) website. In total, the airline is offering a million free seats to various destinations. But while a seat itself is free, you will have to pay airport taxes and fuel surcharges. Plus, there is just a two-week booking window. With its three-tier "Everyday Low Fare" promotion, Malaysia's national flag carrier is effectively adopting budget airline-style marketing tactics. The giveaways are for all flights within Asean and for travel between July 1 and Dec 14, including its busy Singapore-Kuala Lumpur route. Selected routes between Malaysia and some China destinations such as Guangzhou are also included. Mr Bernard Francis, MAS' senior general manager for network and revenue management, told Today that this "aggressive and tactical" promotion was a cost-cutting measure. While MAS makes no profit on these seats, it at least gets more passengers on board contributing to fuel costs and airport taxes. With rising global oil prices, jet fuel prices have soared. To enjoy cheap travel, customers need to make advance bookings between May 21 and June 3. A review of MAS' domestic flights showed that only 70 per cent of its seats were sold, most of them during the last 30 days. This means that when these planes take off, the empty seats go to waste. "The minute the aircraft takes off, all the seats that are not sold becomes perishable and are of no value to us," Mr Francis said. "If we can reduce our overall costs — because we will collect fuel surcharge — it would become competitive." For those unable to get these free seats, two other tiers of pricing follow. For example: A passenger travelling from Singapore to Langkawi will get a ticket free — excluding airport taxes and fuel surcharge — if he is among the first 30 per cent to book online. If he misses out, he will be offered a $29 ticket. And if he misses out on this as well, he will have to pay $59. The current airport tax and fuel surcharge for a flight to Langkawi is about $83. Availability of these tickets may rise or fall depending on demand. When asked if this three-tier model was a gimmick or a long-term strategic shift, Mr Francis said the move was targeted at consumers who are "price sensitive" and willing to "sacrifice in terms of restrictive terms and conditions". Last Monday, the airline launched a similar promotion for its domestic flights. So far, 150,000 seats have been sold with the hottest domestic routes being flights linking airports on the Peninsular to East Malaysian states like Sabah and Sarawak. Mr Francis said the initial two-week booking period will be used to gauge response. If it turns out to be a success, the airline may continue with zero fares. |
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