The worst of the turbulence is over for MASkargo

A conservative expansion plan with a focus on existing routes and strategic tie-ups with other carriers will help MASkargo achieve single digit growth next year, according to the Malaysian cargo carriers' new boss.

The air freight unit of Malaysia Airlines – Malaysia Airlines Cargo (MASkargo) – will take a conservative growth strategy over the next two to three years as it recovers from the group’s recent route rationalisation and growing industry fleet capacity, according to its recently appointed managing director, Shahari Sulaiman.

Speaking to reporters at Air Freight Asia event in Hong Kong, he acknowledged the Malaysian cargo carrier faced a challenging environment, both internally and externally.

From within the MAS group the cargo division was impacted by the far-reaching route rationalisation programme on the passenger side that began in mid-2006 and saw the national carrier withdrawing or cutting back frequencies on its international routes as part of the airline’s turnaround plan. This included a scaling back to cities such as Manchester, Fukuoka and Vienna, all important cargo centres for MASkargo.

With 60 per cent of MASkargo’s freight carried in the passenger belly holds, the scaling back had a significant impact. Shahari said MASkargo’s main operations at KL International Airport (KLIA) had suffered a 4 per cent drop this year and a 10 per cent drop in its Penang operations due to the rationalisation. In the first phase cuts alone, this amounted to an estimated RM60 million (US$18 million) in lost business. Externally, MASkargo like most of its competitors, felt the pinch of lower than expected freight volume growth in the first half of the year along with growing fleet capacity.