Khazanah Nasional chief: Malaysia plagued by overcapacity

Khazanah Nasional's MD, Shahril Ridza Ridzuan opined that Malaysia faces an overcapacity issue, which is reflected in Malaysia Airlines’ persistent losses. The country has 4 main carriers in a market of 30m people, representing "roughly about" 1.7 seats for every flying passenger, he said at a parliamentary committee in April, of which the transcript was released last month. Shahril noted that Malaysian carriers have been facing revenue pressure due to intense competition, and the airlines are pricing their tickets to cover their variable costs but not the fixed asset costs. The Malaysian govt, which owns 100% of Malaysia Airlines through Khazanah, is facing a dilemma as to whether it should continue providing money to the carrier, due to the knock-on effect the airline has on the Malaysian economy. <br/>