AJ & Rashdan: “What Cost Cutting?” Part 5 – MAS uplifted Firefly passengers with Zero Fare

Updates @ 8:30 pm 26-3-2012: TV 3 News at 8: “SC said there is a basis to investigate into MAS for insiders trading related to the MAS – AirAsia share swap. But SC cleared AirAsia for it.” Next posting will be on what AJ and Tan Sri Azman Mokhtar briefed the MPs in Parliament in Parliament House this afternoon..

In November 2010  Firefly commenced its commercial jets for domestic routes and begin with crossover routes, e.g. Kota Kinabalu and Kuching, on Jan 15. Asean will be its next stop. Firefly started to operate new routes with is jets to compete with AirAsia. Competition is, of course, good for consumers/travelers. AirAsia and AirAsia X Sdn Bhd began to feel the heat. Read HERE.

Of course, both AirAsia and AirAsia X Sdn Bhd (formerly known as Fly Asian Express Sdn Bhd during its Rural Air Service [RAS] days in East Malaysia and was given RM250 million by the Badawi’s Administration) were reporting making HUGE PROFITS, which include “UNREALISED FOREX GAIN”, for years.

In 2010 Firefly started to operates new routes from JB to Kuching and Kota Kinabalu, and other routes. Of course, members of the public preferred Firefly as there was no hidden charges and flights were punctual. Firefly was doing very well and its staffs were paid bonuses as high as 8 months salary. Firefly was expanding and expanding until the secret MAS – AirrAsia share swap was inked on 9-8-2011. This also marked the beginning on the stifling of the growth of Firefly. Read HERE.

Out of a sudden Tan Sri Azman Mokhtar (Amok), MD of Khazanah Nasional Bhd (Khazanah), signed the MAS-AirAsia share swap involving Khazanah an Tune Air Sdn Bhd. As part of the said secret share swap deal,  Tan Sri Tony Fernandes and Datuk Kamarudin of AirAsia and Tune Air Sdn Bhd sat on MAS Board, which was never in their wildest dream that came through. Of course, to appease Malaysians, Amok handpicked Datuk Azman Yahya, a former director of MAS to sit on AirAsia Board. By CO-INCIDENT, Datuk Azman Yhaya is also a director of Symphony House and, of course, SCOMI!  SCOMI becomes a household name in Malaysia in a short span of 4 years during the reign of former PM Tun Abdullah Ahmad Badawi. By the way Tun Abdullah Ahmad Badawi is the Advisor to MAS.

On 24-8-2011 (after two week Tan Sri Mokhtar (Amok) inked the secret MAS – AirAsia share swap and CCF),  Soon after there was an announcement to terminate the Firefly jet service. Amok’s crony En Mohamed Rashdan Yusof aka Danny (Rashdan) decided that Firefly will terminate all its profitable routes from JB to Kota Kinabalu and Kuching effective on 15-9-2011.

From the above online tickets from Firefly and MAS, you will no doubt see how MAS had to fork out the expenses of having to uplift the passenger and deprived of revenue of RM1,258-00.  Had Firefly was allowed to operate as it were and expand, Firefly would have made more money for MAS. MAS needs not have to bear the burden of uplifting Firefly passengers for free and at the same time burden with all the expenses. It would be be interesting to know how many of this type of passengers that MAS had to uplift. It must be by the thousands.

Of course, AJ told PAC in November 2011 based on again undated account that Firefly was making loses of RM89 million in order to justify the stopping of Firefly jet service and routes. Read HERE. If Firefly has made such losses how could Firefly and MAS management approved the bonuses as high as 8 months salary.

The Ministry of Finance should conduct a thorough audit by professional to get to the bottom of this. If what AJ said was true that Firefly was making huge losses to the tune of RM89 million then the previous MAS and Firefly Management must be brought to book. If it turns out otherwise then the RM89 million losses was part of “Creative Accounting” and the present MAS maanagement should also be brought to book and appropriate actions should also be taken against them.