About a quarter of Malaysia Airlines’ 20,000 staff are likely to lose their jobs under a restructuring plan for the loss-making airline hit by two separate jet disasters this year, a source with direct knowledge of the matter said.
The restructuring plan, due to be unveiled later this week, will include route cuts as well as the loss of up to 5,000-6,000 jobs, according to the source, speaking on condition of anonymity. The source was not authorized to discuss the plan publicly.
The carrier’s majority owner, Malaysian state fund Khazanah Nasional Bhd, is expected to announce the plan to restructure the firm as early as Aug. 28. Khazanah, which owns 69.37 percent of airline, formally known as Malaysian Airline System Bhd (MAS), said earlier this month it is taking MAS private in a $435 million deal.
MAS is due to announce second-quarter results on Aug. 28 that are expected to show losses expanding. MAS has been struggling with a slump in business since the unexplained disappearance of Flight MH370 in March tipped the airline into its worst quarterly performance in two years in January-March. Its problems deepened on July 17 when its Flight MH17 was shot down over Ukraine, killing all 298 people on board. The airline is now set to post one of its weakest performance in the April-June quarter, hit by due to cancelled bookings, weak passenger yields and high overheads, according to analysts.