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Bleeding $2M a Day, Malaysia Airlines Plans a Hail Mary

Disaster-wracked airline to slash staff, routes in vast overhaul
By Matt Cantor,  Newser Staff
Posted Aug 26, 2014 10:22 AM CDT
Bleeding $2M a Day, Malaysia Airlines Plans a Hail Mary
In this May 27, 2014, file photo, ground crew stand near a Malaysia Airlines aircraft on the tarmac at the Kuala Lumpur International Airport (KLIA) in Sepang, Malaysia.   (AP Photo/Vincent Thian, File)

(Newser) – In a year that's seen one plane disappear and another get shot down, Malaysia Airlines is feeling the financial pain. "The southeast Asia air carrier burns its cash reserves at nearly $2.16 million each day," said Howard University professor Oliver McGee, as per Mashable. "Operations are losing about $1.6 million a day." Customers are posting pictures of rows of empty seats, even as the company is reportedly offering commission hikes to travel agents and huge discounts to customers. On many carriers, a flight between Kuala Lumpur and Beijing can cost more than $500; on Malaysia Airlines, it's recently been less than half that, Mashable notes.

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What's an airline to do? Well, it's poised to cut about 25% of its staff, the Wall Street Journal reports. It also looks ready to get rid of some of its routes, including unprofitable journeys to some areas of China and flights to Frankfurt. A name change could also be on the table, Mashable notes. The possible changes are driven by state investor Khazanah Nasional Bhd, which owns some 70% of the carrier's parent company and is hoping to take the airline private, the Journal notes. "Only through a complete overhaul of the company can we deliver a genuinely strong and sustainable national carrier," says Prime Minister Najib Razak. "Piecemeal changes will not work." (Read more Malaysia Airlines stories.)

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