More on the MAS-Mueller Story

April 29, 2016

More on the MAS-Mueller Story

by Mariam Mokhtar

MAS in its Glory Days under Saw Huat Lye and Abdul Aziz Rahman

Last February, Malaysian Airlines Berhad (MAB) finally made a profit after years of being in the red. Two months later, Christoph Mueller, the company’s first non- Malaysian CEO, announced that he would leave in September 2016, well before the end of his contract.

What prompted his decision? Why leave after making such brilliant progress? Did anyone believe him when he said he was leaving because of “changing personal circumstances”? Let’s see if we can find a reason for Mueller’s decision.

MAS Today

In 1994, former PM Mahathir Mohamad gave control of the successful national carrier, then known as MAS, to his crony, Tajuddin Ramli. But instead of taking good care of the golden goose, Tajuddin and successive chairmen strangled the company.

Making Tajuddin MAS’ executive chairman and selling the company to him was part of Mahathir’s bumiputera corporate advancement project.

Mahathir should have instead adopted his Singapore counterpart Lee Kuan Yew’s approach to running an airline. In 1972, seven years after Malaysia and Singapore split, the Malaysia-Singapore Airlines had to be disbanded. On the eve of the formation of Singapore Airlines, Lee told the workers’ union that his government would have no compunction in closing the company down if it did not return a profit.

 Mahathir, Najib and MAS Advisor Badawi

Now that MAB is back in the black, we fear that the government and its cronies will start to bleed it again until, perhaps, it’s time for another foreigner to come to its rescue. There are Malaysians capable of doing the job, but only a foreigner can wield the stick without inviting too much scrutiny. After all, MAB has political appointees on its board.

Mueller’s role is to act as a foreign advisor. He also gives the MAB board a semblance of respectability.When Mueller first arrived at MAS, he allegedly asked Khazanah how many middle managers the airline had. Apparently, no one knew. It is alleged too that middle managers were running their own firms and bleeding MAS dry by providing services at inflated prices.

When the first cull was made in MAS, the cronies were the first to go. You might think this was a good move, but a MAS insider alleges that it was actually a plan calculated to give a golden parachute to faithful cronies. The cronies and middle managers received handsome retrenchment terms calculated from the time they were first employed. Some had been there for three decades. They received huge amounts in compensation.

Christoph Mueller, and Ahmad Jauhari Yahya

Aware that MAS could not afford to continue giving away these vast sums of money, the management announced that over the next few years, more people would be sacked or asked to retire early but would not be given the same generous compensation terms. In effect, it was a way of getting rid of workers cheaply.

When MAS changed its name to MAB, the employees who were thankful they had been retained had to accept new terms in their contract, which included the prospect of having their services terminated with only two months’ notice. That was why MAS workers were unhappy. Cronies were rewarded. Genuine, hard-working employees were treated shabbily.

So, did Mueller decide to leave because he has a conscience? Or was he concerned about his reputation? He once turned around the ailing Aer Lingus, but with all that is happening in Malaysia now, he probably realises that the longer he waits, the more he risks messing up his CV.

In the 1960s and 1970s, many proud Malaysians were happy to serve MAS. It was a respected and successful airline. If we were to remove political interference, MAB could soar in the skies once again.

Remembering Lee Kuan Yew: A life devoted entirely to Singapore

Mariam Mokhtar is an FMT columnist.

3 thoughts on “More on the MAS-Mueller Story

  1. Anyone in Khazanah or indeed anyone with half a brain in Malaysia knows that MAS, pre-Mueller, was not a commercial entity in any sense of the word. It was over-staffed, (to the tune of 6000, enough to fill 12 Battalions in a modern army!), with pockets of “private” territory ruled over by little napoleons making money at the expense of MAS.

    Now if you are Khazanah and you want to sack all these people and implement an efficient work ethic regime and make MAS profitable again, would you appoint a Malaysian, (of any ethnic color), to do it? Would he dare to do it?

    No, get a foreigner who has no roots or baggage stored anywhere on Malaysian soil. Do the dirty hatchet job, clean up the place, get him to leave, by hook or crook, or just let him finish off his contract. He could then just walk away from Malaysia never to return, which a local Malaysian couldn’t do.

    What they didn’t plan for was Mueller did his job too fast.

    Now we have a reasonably efficient, manageable, marginally profitable airline because a foreigner could or be allowed to go where a Malaysian dared not. It is now time for Malaysia to once more take national pride in MAB and appoint a Malaysian, (no guessing his ethnic color), to run the place once more.

    History tells us that the foreigner only cured the symptoms, not the disease.

  2. Anonymous May 12, 2015 at 4:14 PM

    Since Malaysia-Singapore split one has reached for the stars and going to the moon while the other has taken the opposite route. Both have achieved their goals in their own mode. Now it is time for the two demonstrate if they can it. What you and I say will be of no consequence because, like that world Love, they only respond to their own command. The problem is when vitamin “M” is freely available its value decreases as it volume increases. It akin to watering the plant you have to give it the right amount of water. Too much money (water) will drown and kill the plant. and you must have seasoned staff. While once does not care about seasoned staff the other has been taking senior staff from where ever they can. Train pilot work for other airlines, train staff work for another airline, train new aircraft sell to other airline. Can anyone, anyone explain to me what business Model is this?

  3. New Boss alleady on spending spree lorr…! – May 10 2016 – “KUALA LUMPUR: Malaysia Airlines Bhd (MAB) has announced a strategic partnership with fashion brand Farah Khan to re-energise the design aesthetic of the national carrier’s iconic kebaya and other uniforms.

    Through the partnership, the fashion brand’s creative director, Farah Khan will design the full range of uniforms of various departments of the airline, including its flight deck, cabin crew, airport and engineering outfits.

    Malaysia Airlines Chief Commercial Officer Paul Simmon said Malaysia Airlines’ uniforms, especially the kebaya, has served as an iconic symbol and a source of great pride for generations.

    “With this collaboration, we look forward to taking this a step further, creating a fashionable and functional new collection,” he said in a statement here today…” –

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