Friday, December 14, 2012

Want Want China Holdings Ltd

By The Wall Street Journal

Tsai Eng-meng, the famously persistent chairman of Want Want China Holdings Ltd., recently tightened his grip on the Taiwanese media market after he and a consortium of buyers finally struck a deal with longtime rival Jimmy Lai of Hong Kong to buy the Taiwan print and television operations of Mr. Lai’s Next Media empire. Mr. Tsai, ranked No. 1 on Forbes’ list of Taiwan’s richest people with an estimated net worth of $8 billion, is a controversial figure on the island for having once said he hopes for eventual reunification with mainland China. His involvement in the Next Media purchase has sparked fears over editorial independence in Taiwan – Mr. Tsai already owns a TV station, three newspapers and several magazines on the island – and helped earn the top spot on this month’s China Power List, a ranking of top corporate newsmakers in the world’s second-largest economy compiled using data from Dow Jones Insight.

Eccentric Alibaba founder Jack Ma, no stranger to the Power List, maintained his grip on the second spot, followed in third by Liang Wengen, chairman of Changsha, Hunan-based Sany Heavy Industry Co., who moved up from No. 7 following a recent flare-up in his company’s long-running public feud with hometown competitor Zoomlion Heavy Industry Science & Technology Co.

Thursday, December 13, 2012

Indonesia Billionaires

By Eric Bellman - The wall street Journal

Indonesia now has more billionaires than Japan, as Southeast Asia’s largest economy’s expanding middle class continues to ignore the global economic slowdown and shop, pushing up the value of the companies that sell them new stuff and services.

Forbes Indonesia’s latest list of the country’s richest people, released this week, sets its billionaire tally at a record 32 people and families, edging out Japan, which Forbes says is home to 28 billionaires. Last year Indonesia had 26 billionaires, according to Forbes’ calculations.

While the archipelago’s crowd of coal magnates was hit hard by a plunge in coal prices, the commodities collapse was more than offset by the growing wealth of the people behind the country’s top retail, media, banking, food and tobacco companies.

“The thing that really stands out is that the money of those that produce something for the middle class has been rising while those that made money mostly from commodities went down” in ranking, said Justin Doebele, chief editorial adviser of Forbes Indonesia.

Topping the ranks were R. Budi and Michael Hartono, worth $15 billion thanks largely to their holdings in Bank Central Asia. Also in the top five was Anthony Salim and family ($5.2 billion), who are behind the world’s largest instant noodle company, Indofood.

Newcomers included mall and property developer Alexander Tedja ($790 million) and snack manufacturer Garudafood’s Suhamek ($760 million). The poorest rich man on the list was newbie Eddy Kusnadi Sariaatmadja ($730 million), who made his money selling computers and now manages television stations.

Many of the country’s coal barons got burned this year. Banyan Resources’ Low Tuck Kwong saw his worth slip by close to half to around $2 billion, according to Forbes, while presidential hopeful Aburizal Bakrie and his family fell off the list entirely, as falling coal prices and a boardroom battle over control of their London-listed company Bumi PLC BUMI.LN -4.85%slammed the value of their assets.

While a lack of public disclosure can make it difficult to estimate exact wealth, Indonesia’s bulging batch of billionaires shows that family fortunes have been largely protected across the archipelago even as most of the world struggles with a slowdown.

And though Indonesia’s billionaires club is still smaller than the ranks in China (more than 100 billionaires) and India (more than 50 billionaires), with less than one-fourth the population of China and India, it has more billionaires per capita.

Indonesia expects its gross domestic product to expand more than 6% this year as well as next year. It has been attracting a record amount of foreign direct investment as companies including Toyota Motor Corp. 7203.TO +0.98%, Nestlé SA and General Electric Co. GE +1.26% have been ramping up their capacities in the country to better target its emerging consumers.

Indeed, many countries in Southeast Asia have been shining while the rest of the world slumps. The region is now home to the world’s richest country by some measures – Singapore – and hundreds of thousands of new millionaires.

Malaysia Billionaire:
Indonesia is attracting lots of Foreign Direct Investment (FDI), inclulde Air Asia HQ has been moved to Indonesia.

Tuesday, November 06, 2012

Express Rail Link Sdn Bhd (KLIA Express) to be listed?

By The Star

Express Rail Link Sdn Bhd (ERL) may consider floating its shares on Bursa Malaysia to raise funds if it is chosen to operate the proposed high-speed rail project linking Kuala Lumpur and Singapore.

Chief Executive Officer Noormah Mohd Noor said the feasibility study on the project was still being done by the Land Public Transport Commission.

"We're very interested to bid the project. I understand that the study will be submitted to the government to decide on who will be the operator," she said during a media briefing here on Tuesday on the progress of the ERL extension to klia2 project.

Noormah said the company's track record showed that it was very capable of undertaking the project.

She also said the company has developed expertise in operation and maintenance of high-speed trains locally through its subsidiary ERL Maintenance Support Sdn Bhd.

"We are running a world-class standard in terms of performance and we are highly-recognised all over the world as a far as airport rail service is concerned."

She added that ERL had also won many awards including the coveted North Star AirRail Link of the Year Award at the Global AirRail Awards 2012 in Stockholm while its KLIA Ekspres VIP Service had won the Best Customer Service Award. - Bernama

Malaysia Billionaire:
Well i think is worth to grab some share in ERL, it has a been a very reliable railway operator if anyone of you has used their facilities via KL Sentral to KLIA or vise versa. Moreover they have the strong backing of YTL Corporation Berhad , Lembaga Tabung Haji Bhd and Trisilco Equity Sdn Bhd with 50%, 40% and 10% shareholding respectively.

Tuesday, October 23, 2012

Air Asia the biggest and Largest airline in China

By The Star

AirAsia has added Kunming, the southwestern capital of Yunnan Province, as a new destination to strengthen its existing 23-route network in China.

The new route, which takes off from Kuala Lumpur, will commence operations on Dec 10 with weekly flights on alternate days Monday to Sunday.

A promotional all-in fare of RM88 onwards one way is good for booking from today until Oct 27.

“According to the Centre for Asia Pacific Aviation (CAPA), AirAsia is the largest foreign airline in China at the moment, and we will continue to work hard to maintain this,” AirAsia Bhd chief executive officer Aireen Omar said at a press conference yesterday.

Over the last few years, AirAsia has been reaching into second-tier cities in China, a move that has yielded promising results for the low-cost airline.

“The Chinese truly appreciate it. Diving is getting increasingly popular there and they yearn for beach holidays at East Malaysia and east coast of the peninsular,” AirAsia commercial director Jasmine Lee said.

“Our flights from China give them easy access to out hot spots.”

Likewise, a cooler climate and notable attractions such as UNESCO World Heritage-listed sites Naigu Stone Forest and Suogeyi Village in Kunming are expected to appeal to Malaysians.

Recently, AirAsia announced three other routes Bangkok-Wuhan, Bangkok-Xian and Kuala Lumpur-Nanning, which flies on alternate days Tuesday to Saturday.

Fast-selling tickets were another motivating factor for the airline company to fly into Kunming; Nanning, being a popular business destination for Malaysians, would encourage passengers to connect via Kunming for sight-seeing.

With just four weekly flights to the new destination, impact on earnings is expected to be insignificant.

“Rather, it is the overall frequency and many routes into China that matter. Our audience there makes up half of our top 20 most profitable flights,” she said.

In conjunction with the new destination, AirAsia's flights to other cities in China are bookable from November to January for all-in fares starting from RM199.

The new route to Kunming will be operated on AirAsia's Airbus A320 with a capacity of 180 seats.

Friday, October 19, 2012

Malaysian Asian Robert Kuok

By Andrew Tanzer

IN 1993 THE COCA-COLA CO. was ready to invade part of China in a big way, but this is tricky turf. Coke understood that China could be a gold mine or a disaster. It needed a savvy local partner.At stake was the right to bottle Coke in an area stretching across north and southwest China and inhabited by 450 million people. But pushing that quintessentially American product into the depths of China took careful handling.Let’s put this in perspective: The license to bottle Coke in the Philippines, population 70 million, recently sold for $2.6 billion. By this standard, the China deal could in time be worth $8 billion. Every capitalist in Asia coveted the deal.
Coke chose Robert Kuok. “I thought, ‘My God, this is a gift from Heaven,’” Kuok recalls. Kuok is being modest. It was no gift. Coke knew what it was doing.

Soft drinks were not Kuok’s business, but Coke didn’t need expertise in soft drinks. It needed a smart guy with contacts. And that’s Kuok, a 73-year-old hotel owner, commodities trader, investor, cosmopolite.

Keeping 12.5% of the bottling venture, Coke granted 87.5% to Kerry Group, Kuok’s Hong Kong-based conglomerate.

Rarely interviewed, stubbornly shunning publicity (“the Chinese have a saying,” Kuok explains, “‘Tall trees experience strong winds’”), Robert Kuok was at first reluctant, but finally agreed to talk with Forbes. When he did, he opened up and gave us remarkable insight into a remarkable mindnd a remarkable career. Our photographs of him are among the very few in public hands.

“He is a perfect businessman,” says Randolph Guthrie, chief executive of the Singapore-based Beaufort Hotels chain. Guthrie now competes with Kuok’s Shangri-La hotels, but he once worked for Kuok.

“Perfect” is a peculiar word to apply to a businessperson, but in the sense of being well-rounded it surely applies here. Speaking impeccable English, fluent in Malay and five Chinese dialects, cultured and yet personally unassuming, Kuok�”R.K.” to his executivesay not be the biggest player in Asia. We estimate his family’s net worth to be at least $7 billion. But for sheer versatility, imagination and ability to get things done he has no peer.

“What could take us 18 to 24 months [in China], they [Kuok's Kerry Group] could do in 2 months,” says John Farrell, president of Coca-Cola China Ltd. “His whole life has been built around building networks with overseas Chinese and in China. [Kerry's] ability to do things fast is incredible.”

“I adapt like a chameleon to the particular society where I am operating at the moment,” Kuok says. Robert Riley, managing director of Mandarin Oriental Hotel Group, a fierce Kuok competitor, says: “He’s a local everywhere he goes.”

It’s hard to find a business or an East Asian country where Kuok isn’t involved: food, luxury and middle-market hotels, real estate, sugar and oil palm plantations, newspapers; including the world’s most profitable, South China Morning Post. He has large investments in Indonesia, Hong Kong, China proper, Australia, Malaysia, Singapore, the Philippines and Thailand. He owns a piece of Citic Pacific, the Beijing-controlled conglomerate. On that investment alone he has made some $1 billion in six years.At the epicenter of all this activity is Kuok himself. The nearest equivalent we can think of, where a single person holds in his hands the ultimate reins of so many businesses, would have to be Rupert Murdoch. But Murdoch’s business is of a piece in that it is mostly in communications media. Not so, Kuok. The only thing binding his interests is the acumen of the man himself. “I’m the little string that ties the rings together,” is how Kuok describes his role.R.K. focuses on strategy and relationship-building and makes most of the final decisions, with help from executive committees in Hong Kong, Singapore and Kuala Lumpur. But he leaves day-to-day management of the businesses in the hands of 35 trusted senior executives (including half a dozen relatives) who report directly to him and network among themselves.
Here’s a key to how his mind works: Khor Chin Poey, an engineer who runs the Malaysian and Indonesian agribusinesses, says that when Kuok phones he is less interested in profits than in sales volume. “His logic is production equals money,” explains Khor. “He assumes you know how to run your business, and he knows prices and your margins.”

Obviously he takes for granted that the margins will be maintained. Heaven help the executive who does not watch those margins. He himself has a prodigious head for numbers. In talking with Forbes, Kuok recalled 1940s foreign-exchange rates to the hundredth and 1960s per-square-foot property prices in Singapore to the penny.

Here’s another key to his character: He is prejudiced against M.B.A.s. “When I hear somebody’s got an M.B.A.,” he says, raising his voice a bit, “I have a feeling of dread, because normally they come to me with an overpompous sense of their own importance. And no way are you going to prick that bubble, with the result that one day there will be a cave-in in their department. So they learn painful lessons at my expense!”

Kuok says he prefers people with an inner humility. He recalls his mother’s Buddhist outlook and its emphasis on that virtue. “A highly successful man invites many problems and miseries,” Kuok says. Why multiply enemies with a high profile or by boasting about accomplishments?

Robert Kuok was born in 1923 and raised in Johore Bahru, a mixed Chinese, Malay and Indian town just across the causeway from Singapore in what was then British Malaya. His father, an immigrant from China’s Fujian province, prospered in businesses ranging from a general merchandise store to trading and cold storage. But the elder Kuok’s horizons were limited by colonialism and a lack of familiarity with Western ways.

Kuok says his father was much closer to the Malay community than to his fellow Chinese. It was Malay friends, for example, who lured his father onto a slow boat to Europe in 1928 to kick an opium habit.

Unable to speak English himself, Kuok’s father saw that learning the language and manners of Malaya’s colonial rulers was crucial if the second generation was to expand the family business. So he sent Robert and his two older brothers, Philip and William, to fine British-run schools in Malaya. Robert’s classmates included the second and third prime ministers of postindependence Malaysia, and Lee Kuan Yew, the first prime minister of Singapore.

Kuok was a student at Singapore’s Raffles College when, on Dec. 8, 1941, the Japanese bombed the island and declared war. Retreating to Johore Bahru, he went to work in the local office of Mitsubishi Corp., the Japanese trading company. He was then 18.

“The Chinese have a saying: ‘Tall trees experience strong winds.’”

Mitsubishi had a monopoly on rice imports into the state of Johore, and young Robert soon headed the rice department. Kuok Senior obtained a license as a wholesaler from the local food controller.Shortly after the Japanese surrendered, Kuok and his father won a contract from the British military to supply fresh produce to 50,000 Japanese prisoners of war interned at a rubber estate. This led to the Kuoks’ appointment as distributors of essential foodstuffs for all of South Johore classic case of Chinese middlemen serving as liaison between colonial masters and the locals. Robert ran the godowns, the waterfront warehouses that stored the commodities, mostly brought in from Singapore. Kuok is now a large Hong Kong godown owner.After Kuok’s father died suddenly, in December 1948, Robert, then 25, joined his mother, brother Philip and two cousins in a new family business. Robert soon dominated the company, and his brother Philip eventually left to become a Malaysian diplomat who served as ambassador to several European countries.
Middle brother William took a third path. After WWII he became a senior figure in the Malayan Communist Party, and was killed by British troops in the Malayan jungle in 1952.

In the early 1950s rice was a competitive business. Searching for an advantage over competitors, Kuok switched his emphasis from rice to sugar and in 1953 moved his base to Singapore. “The sugar trade was conducted in English, which put me in a stronger position,” he explains. “I was reading Reuters.”

In 1963 Kuok made a killing, trading sugar physicals and futures out of a room at London’s Grosvenor House hotel. He cleaned up, speculating in the commodity from 1963 to the mid-1970s, years of high volatility and price peaks in sugar.

“I’m still shuddering when I think of some of my exploits of the 1960s, of how narrow were my escapes,” he recalls. “I risked everything without realizing it. It was all rhythm. Have you ever seen Michael Jordan play when he’s on a rhythm run? It was exactly like that.”

Malaysian independence in 1957 was a boon for Kuok. “With the presence of a British colonial administration, the best cakes went to the British houses,” he recalls. “When colonialism ended, I was there to capitalize on the opportunities.”

With close ties to the Malay political elite, Kuok soon secured a license to build the country’s first sugar refinery, with tariff protection. By the mid-1960s he dominated the Malaysian sugar industry. He still does. Except for his period of commodity speculation, Kuok generally follows a policy of buying and holding.

With his keen diplomatic skills, he built local businesses in the 1960s and 1970s, when relations between the Malay and minority Chinese communities were often uneasy. “While other local Chinese felt discriminated against, Kuok worked out who needed him,” says Hugh Peyman, managing director of Kleinwort Benson Securities (Singapore) and a keen observer of Southeast Asian politics and business. “He knew where the power was and that he had to prove he was a better Malaysian than anyone else.”

Early on he was fortunate to win the backing of Chin Sophonpanich, the legendary founder of Bangkok Bank who backed many of the great overseas Chinese entrepreneurs.

“He [Chin] didn’t wait for you to go see him,” says Kuok, recalling how Chin came to his trading office in Singapore in the late 1950s. “Do you know why? He wanted to see how you operated, how you placed your desk, the sense of drive in the office.” Chin was soon financing Kuok’s enterprises.

Kuok traded sugar and rice with China as early as 1960. As a measure of his ability to navigate politically tricky waters, he was able to continue doing business with China through Hong Kong even during the Cultural Revolution. One of his early contacts, the state-owned foodstuffs agency Ceroils, is today a small investor in Kuok’s oil palm plantations in East Malaysia and a partner in some of his vegetable oil, flour milling and Coke plants in China.

What brought a sugar and rice trader into the hotel business? Like many wealthy people, Kuok understands that well planned and located luxury hotels are timeless investments, growing with their communities and splendid hedges against inflation. (Kuok estimates that the land under his Shangri-La Singapore has appreciated about 300-fold since it was purchased in the late 1960s.)

“I spent a lot of time in some excellent hotels in Europe,” says Kuok. “I knew what I wanted in a good hotel.”

Kuok’s partners in his Shangri-La properties are usually the local businessmen he deals with in sugar, cooking oil or other items, or owners of choice real estate. A partner in Thai sugar mills became his partner in the Shangri-La Bangkok. His partners in Shangri-La Singapore, which opened in 1971, were rice traders.

In the late 1960s Kuok met Indonesian billionaire Liem Sioe Liong through the sugar trade. Today the two tycoons jointly operate massive and rapidly expanding sugar plantations with mills and refineries in southern Sumatra. Liem invested in Kuok’s Shangri-La hotel in Jakarta and in one in Hong Kong.

With 17,000 rooms, the Shangri-La chain is now Asia’s largest luxury hotel group. It’s probably worth $4 billion. Although he is not primarily a real estate person, Kuok has made huge investments in properties, accumulating beachfront in Penang, shopping malls and apartment buildings in Singapore and Shanghai, office towers in Manila and Beijing. In 1988 he bought a portfolio of luxury apartment buildings in Hong Kong’s Midlevels district for $175 million from Australia’s Alan Bond, who was on the verge of bankruptcy. The capital gain on that investment alone is already more than $1 billion.

In 1974, with three aides, Kuok moved headquarters from Singapore/Malaysia to Hong Kong. Motive: taxes. “If you made a dollar, you kept only 50 cents of it in Malaysia and 60 cents in Singapore.” Hong Kong, on the other hand, allowed him to keep 84 cents.

As the Coca-Cola deal suggests, the current thrust of Kuok’s deals is China proper, where consumption of edible oils like palm oil expanded 50% from 1992 to 1996 as more and more Chinese gained disposable income. “The most important [food] market is always China, but it’s still early days there,” says Kuok. A natural market, of course, for Coke.

Kuok met Warren Buffett at a Coca-Cola shareholders’ meeting in Wilmington, Del. in April “lovely man,” says Kuok. He likes Buffett’s concept of picking smart people, backing them to the hilt and then getting out of the way so long as they don’t screw up. “You think you’re a smart businessman, but you must realize that many people are smarter than you. If there are smarter peopletronger, better horses runninghen why aren’t you putting some of your money on them and not all of it on yourself?”

The same attitudehat willingness to learn from othersurfaced when we asked Kuok how he makes tough decisions. “When I’m in doubt,” he replied, “I chat. One of the best ways is to offer a cleverer man than yourself a joint venture deal, and if it’s poison he’ll say it’s an awful thing. Then you’re seeing the deal through other people’s eyes.”

There’s that old humility again. But in Kuok’s case, humility does not translate into conventional thinking. Kuok’s success owes much to a strong contrarian streaknd a strong stomach to go with it. He stayed the course in Malaysia after the 1969 ethnic riots. He plunged into racially turbulent Indonesia in the early 1970s, when few overseas Chinese dared to.

After Philippine dictator Ferdinand Marcos fled the country in 1986, Manila was shunned by investors and tourists. Kuok, who says he’d never been able to do much commodities business under Marcos, now moved in. “Everybody said that nation’s gone to the dogs, but the intensity of the music was gradually dying down, if you could listen carefully,” he recalls.

So he began building two Shangri-La hotels, the first hotels built in nearly 20 years in Manila. “Somewhere along the line the nation would recover, and if you’re putting up a nice building in a super location, where’s the risk?” he reasons.

He continued to invest heavily in China through the volatile cycles of the 1980s, when many wealthy overseas Chinese were making charitable donations to their ancestral villages but otherwise keeping their capital safe in Hong Kong or elsewhere.

“In China,” says Adrian Fu, chairman of Hong Kong’s Furama Hotel Enterprises Ltd., “it’s important that you can prove to the leaders that you do not abandon them when they are in trouble. Kuok has done that.”

When the Tiananmen incident occurred in June 1989, Kuok was in the middle of building his massive, $530 million China World Trade Center, a showcase joint venture with the Chinese government in downtown Beijing. Banks and contractors panicked, but Kuok stuck it out. Construction was delayed, and Kuok had to pump in more equity. Today the project, which includes two hotels, nets $80 million to $90 million a year, after taxes.

It may shock some Americans, but Kuok has never hesitated to get into bed with the Beijing bosses. Nor does he apologize for that. He believes the Tiananmen crackdown prevented anarchy, and he professes admiration for the country’s current leadershiphich, he says, is committed to economic development.

Like most ethnic Chinese, Kuok has a powerful sense of family. He has eight children from two marriages. Two sons are in the business, and his daughter Ruth helps him manage the group’s charitable foundations. Eldest son, Beau, oversees hotels, real estate and Coke-bottling; second son, Ean, recently moved to Hong Kong from Singapore and keeps an eye on Singapore/Malaysia and will soon take charge of the edible oils business. Two nephews and a nephew-in-law hold important positions.

But unlike many other ethnic Chinese magnates, Kuok is not afraid of putting trust in outside senior management, often including Westerners like Paul Bush, Owen Jonathan and David Hayden. Old China hand Robert Theleen, chairman of Hong Kong’s ChinaVest Ltd., thinks Kuok is way ahead of other ethnic Chinese businesspeople in adapting to a changing world.”The next decade will be about whether the multinational corporation can be extended to the Chinese environment,” says Theleen. “Kuok’s already moved from entrepreneurship to multinationalism.”

Nor is Kuok afraid to part with equity. More than 30% of the shares in the three main family holding companies are held by nonrelatives. “You can’t take [wealth] with you. As for leaving it all to your kids, is it necessary, is it wise, do you want to drip acid on their heads constantly?”

Interestingly, Kuok has done little in the U.S. He has apparently felt he had more opportunities than he could handle in his own backyard. He hinted to Forbes, however, he wouldn’t be averse to investing in hotels in the U.S.

Keep your eye on the man. Coke knew what it was doing when it picked Kuok from all the magnates in Asia to be its guide and partner in China.

A tasteful host 
AS HIS MOST visible business, the Shangri-La hotel and resort chain reflects Robert Kuok’s tastes and personality. Kuok loves crystal, so his Island Shangri-La hotel in Hong Kong has more than 700 crystal chandeliers that cost from $600 to $11,000 each. From a standing start a quarter of a century back, Kuok has built Shangri-La (from the James Hilton novel Lost Horizon) into Asia’s premier luxury hotel chain. Kuok knew nothing about hotel management, so he did what is for him a typical thing: He partnered with a first-class foreign operation, in this case the U.S. hotel group Westin Hotels & Resorts, to operate his first two large five-star properties in Singapore and Hong Kong. When he founded his Shangri-La Hotels & Resorts management company in 1983, he staffed it partly with ex-Westin managers.

Today Shangri-La Hotels & Resorts operates 36 properties across the region and is set to expand to 50 within five years, much of the expansion in China, where Shangri-La has 12 hotels and 8 under construction. Now 90% of the clientele in China consists of foreigners, but the domestic market is the real growth area as China industrializes and prosperity spreads into new regions. But the expansion is measured and deliberate. “We don’t want to cookie-cutter the chain,” says David Hayden, managing director of Shangri-La Hotels & Resorts.

A well-run luxury hotel in Asia achieves gross operating profit margins of 35% to 45%, compared with 20% to 25% in the West. The biggest of Kuok’s public hotel companies, Shangri-La Asia Ltd., last year earned $141 million on revenues of $390 millionn impressive net profit margin of 36%. The management company is all in the Kuok family, but Hong Kong-listed Shangri-La Asia Ltd. owns 20 of the hotels. The stock sells for 12.7 times 1996 earnings.

Malaysia Billionaire:
How could i missed out about Robert Kouk? Asia Sugar King, Malaysia Sugar King, influential Business man in China and Hong Kong. 

Saturday, June 16, 2012

Tony Fernandes will over see the Air Asia Group

By Business Times (Koi Kye Lee)

AirAsia Malaysia's new chief executive officer (CEO) will take the airline into another league, said AirAsia Group CEO Tan Sri Tony Fernandes.

"I am very excited by the announcement and it shows the progressive nature of AirAsia and I think when this person is announced, you can see their career and how far they have come," he told reporters yesterday after witnessing the signing of a Facilitation Fund Grant agreement between Epsom College and the Public-Private Partnership Unit (UKAS) in the Prime Minister's Department.

"Actually, I am dying to announce the name but I have got to keep quiet, so come Monday, I will tell you and I think it is going to be a good day for corporate Malaysia in many ways," Fernandes said.
AirAsia is currently in the process of restructuring its management to accommodate the shift in emphasis on its future growth plans.

It was recently reported that Fernandes will be announcing the key personnel to run the regional structure as well as new AirAsia Malaysia CEO on Monday (June 18).

Business Times reported last week, quoting Fernandes, that the new CEO will be managing the operations in Malaysia, while he will be overseeing all AirAsia operations in Malaysia, the Philippines, Thailand, Indonesia and Japan.

Thursday, March 22, 2012

MAS able to become profitable again with oneworld member?

By The Star

By year-end Malaysia Airlines (MAS) would have become a full member of the oneworld alliance and would be able to offer connectivity to about 800 destinations in 150 countries by riding on an expanded oneworld network.

“This membership will be among the significant catalysts that will complement our efforts to win back customers and become a profitable preferred premium carrier as outlined in our Business Plan,'' said MAS group chief executive officer Ahmad Jauhari Yahya.

Jauhari said the entry into oneworld would enhance its network considerably while providing baseload demand from fellow oneworld members.

“The prospect of being able to offer improved global coverage and connectivity through an expanded network of great airlines to MAS guests is indeed very exciting. Our customers, in particular members of our Enrich loyalty programme, will benefit from increased rewards and recognition while enjoying more seamless air travel options “We look forward to our full membership that will improve our brand awareness among the alliance members' customers and enhance our load factors through additional partner traffic,'' Jauhari said when witnessing the entry of airberlin into oneworld on Tuesday.

Airberlin now serves 162 destinations in 40 countries with a fleet of 170 aircraft and a workforce of 9,200 employees and it became part of oneworld, adding the second biggest airline in Germany and the sixth biggest in the European continent overall to the airline alliance. Austria's NIKI, also a member of the airberlin group, joined oneworld as an affiliate member at the same time.

Other oneworld members include American Airlines, British Airways, Cathay Pacific, Finnair, Iberia, Japan Airlines, LAN, Qantas, Royal Jordanian and S7 Airlines, as well as 20 affiliates including Austria's NIKI, American Eagle, Dragonair, LAN Argentina, LAN Ecuador and LAN Peru.

Malaysia Billionaire:
Oneworld is just a platform that convenience the internet users to book their air tickets, where you are able to garner all the flight information across the globe provided the participant airliner is a members. I personally think it would not make sure impact on MAS profits.

Monday, March 12, 2012

Malaysia Locally Assemble VW Passat

By YS Kong -

Pekan, 11 March, 2012 – It is here at last – the locally assembled Volkswagen Passat was unveiled today by the Malaysian Prime Minister YAB Dato’ Sri Mohd Najib bin Tun Haji Abdul Razak in the royal town of Pekan, Pahang, at the DRB-Hicom plant. This historical moment represents the first fruits of the collaboration between our local automotive conglomerate and the Volkswagen Group, which began with discussions that resulted in the auspicious signing ceremony held at the end of 2010.

Present at the unveiling were the top management of DRB-Hicom, including Dato' Syed Mohamad Syed Murtaza, Chairman of DRB-Hicom, Dato Sri Haji Mohd Khamil Jamil, Group Managing Director, DRB-Hicom, and top management from Volkswagen, Dr. Christof Spathelf, Senior Vice President, Group Manufacturing Overseas and Mr. Soh Wei Ming, member of the Board of Management of Volkswagen, and Head of Commercial Operations, China/Asean. Also present was Mr. Ricky Tay, Managing Director, Volkswagen Group Malaysia.

According to a follow up release, the Volkswagen Passat is priced at RM170, 888, and will be available for sale at all the 18 Volkswagen outlets nationwide. The release also stated that the Passat will have other variants, and the price will range from RM169,888 to RM184,888, according to specification and trim levels. We understand that some 300 units are already assembled, and ready for delivery.

According to Dato Sri Khamil, this collaboration with Volkswagen will eventually boost the production volume at the Pekan plant from its current 23,000 units a year to 50,000 units when the full complement of the planned local assembly is activated. Although at this time, Dato’ Sri Khamil did not specify what models are to be assembled, we do recall a year ago during the initial signing ceremony between DRB Hicom and Volkswagen that the Polo sedan and the Jetta are the planned models.

Immediately after the launch, some members of the media who attended the ceremony were given a first-hand taste of the locally assembled Passat in the form of a 300 kilometre drive from the Pekan plant to the Glenmarie golf and Country Club in Shah Alam. Having seen and driven the CBU Passat not too long ago, we found the locally assembled Passat to be just as good. The parts for these first 300 units come as a total package from the Volkswagen Group – there is a target of 40 percent local content, and according to Dr. Spathelf, the local content will be introduced in stages, and all local content parts must meet the quality standards of Volkswagen before they can be accepted.
The test of the local assembly would be in the fit and finish, the door gaps and trim integrity – our first impression of the test units, and there were twenty of them on the road today, is that the local units are indeed as good as the imported units.

Malaysian Billionaire:

So finally they made it, based on my previous posts. Here & Here

The price different between a local assembled (CKD) VW Passat and a fully imported VW Passat would be RM14k.

OTR (Without Insurance) Fully Imported = RM 185,967.20
OTR (Without Insurance) Local Assembled (CKD) = RM 171,967.20

I personally preferred the VW Passat CC which is priced @ RM256,060.00 / RM 271,060.00 (Sport).

Friday, March 02, 2012

Does MAS payout bonuses to employees in this time around?

By The Star

It is about time Malaysia Airlines (MAS) is sold, and some have even suggested that it be sold for a ringgit.

Those who love MAS will fight tooth and nail to keep it but the reality is, selling it may just be an option to hopefully end its woes.

A decade ago, Tan Sri Tony Fernandes and his buddy Datuk Kamarudin Meranun paid a ringgit to buy AirAsia, which had two aircraft. They also took on RM40mil of the debts.

After seven months of operations, AirAsia managed to repay all its debts and made a profit of RM19.4mil.

That is history, but today, AirAsia has over 100 aircraft, operations in Thailand and Indonesia, and these two companies are slated for a listing this year. Japan, Philippines and even the Middle East are AirAsia's playgrounds and its cost is the lowest in the world because it is run by two entrepreneurs who are constantly thinking of how to rev up profits.

That is what MAS needs, not just cuts.

MAS has been through enough shake-ups, cost cuts and route cuts to be profitable but yet it falls into the red. The question is, will all the cuts this time around save the airline?

Will MAS be profitable and how profitable can it get?

On Thursday, MAS again shocked the market with a RM2.5bil net loss for full year 2011 and some of its own employees were dumbfounded with the figure.

The loss included a RM1.09bil provision, which was a non-cash item.

If you strip out the provision, the actual loss is about RM1.4bil. The provision is an accounting treatment which some analysts refer to as “kitchen sinking.''

Whether that kind of provision is necessary is up to the new team. But by so doing, it is taking the hit all at one go, so that when things improve, it can show profit. Whatever, they should know what they are doing.

Coming back to the point of selling the airline - of course there is also the contratrian view, since the airline was privatised before and had to rescued by the Government a decade ago. So why sell again?

The issue here is about positioning and for now MAS is often referred to by players as a second tier premium carrier whilst rival Singapore Airlines (SIA) is the first tier, and best in class.

The question ahead is also about survival in a highly competitive climate where even the biggest of players are merging and forming alliances and some have gone into arming themselves with both the premium and low cost suite of services to serve different market segments.

Take the example of SIA, it has both the low cost and premium products via its units, so has Thai Airways International, ANA, Qantas and even Japan Airlines.

SIA offers short/long haul premium services, value via Silk Air, short haul low cost via Tiger Airways and soon, long haul low cost via Scoot.

The share swap between MAS and AirAsia owners does limit competition and the collaboration is supposed to help the airlines work on many areas but it is nothing like having one big company that serves all market segments like SIA.

And how many more restructuring MAS needs to ensure it does not slip off route again.

We should be open about letting entrepreneurs run the show.

For a long time, MAS and Proton were two companies with big problems and were bleeding as they were seen to be “not competitive enough.''

After much resistance, the Government has finally sold Proton to DRB-Hicom, and now it is up to DRB-Hicom to prove that Proton is worthy of the purchase.

It also stops the possible public outcry that public funds are used to rescue companies.

Like it or not, Proton and MAS has to be run like private companies and those who call the shots should consider selling MAS.

Be it Fernandes or Kamarudin, they are in the business and MAS needs the “entrepreneurial push and mentality of making money.''

In the final analysis, we need a stronger and bigger Malaysian airline, not just a premium airline. That is food for thought.

* I bet all MAS employee are jst shaking their legs with nothing much work to do. I wonder do MAS payout bonuses to their employee?

Thursday, January 12, 2012

Swapping of shares, it's a win-win situation for Air Asia and MAS

By The Star

AirAsia X (AAX) seems all set to start ticket sales for the much-awaited KL-Sydney route next week and will begin mounting flights to the Australian city by April this year, way ahead of rival Scoot.

The airline is also said to be in the final stages of rationalising its route network where it would cut some routes which it deemed to be unprofitable and add Sydney and some routes to China (provided it can get slots there) to its network.

“We want to do that (Sydney) well ahead of the competition,'' said a senior official of the airline group.

Scoot is Singapore Airlines' long-haul low-cost carrier that has named Sydney as the first city of call out of Singapore and plans to begin flying the route by mid-year.

The official declined to elaborate, but market has it that AAX will begin selling tickets for the sector next Tuesday and a team is planning to launch the sales from Sydney.

The first flight is slated to take off on April 1. However, all is subject to its internal planning, though the airline may be looking at daily flights for the KL-Sydney sector.

This puts an end to the near three-year wait and a bitter fight with Malaysia Airlines (MAS) over the route. MAS had previously lobbied against competition and the national carrier is still the only airline serving the KL-Sydney route after Jetstar withdrew from the sector in 2009.

This sharing of routes has been made possible after a share-swap agreement between AAX's sister company AirAsia and MAS on Aug 8 last year and both will collaborate rather than compete.

Currently, MAS flies twice daily from KL to Sydney and whether MAS will reduce the frequency to once daily and make way for AAX to take on the other slot is unclear.

“Choices and reasonable fares are what a traveller wants. But the biggest fear for travellers over the collaboration is the lack of competition and that is seen by the fare pricing for the Dehli/Mumbai sectors where the fares offered by AAX are somewhat close to that offered by MAS,'' said an industry source.

To be fair, AAX does offer reasonable rates for its Melbourne, Perth and Gold Coast flights and if the booking is made in advance, the savings can be up to 40% of the full-service fares. The airline is currently offering a 20% discount on its base fares for all its routes for a limited period.

Asked on the strategy for the KL-Sydney route, the official said:“We would offer lots of low fares and as we are already well known in Australia it should be (fairly easy to fill up our aircraft).''

Interestingly, those in the know claim that AAX is close to finalising details on whether to exit from the Indian (New Dehli, Mumbai), European (London and Paris) and Christchurch routes.

Sources said both MAS and AAX had had several meetings over the matter so that MAS could take over all the slots from AAX for the routes and carry AAX passengers that have booked seats with the airline.

The date for axing the route is said to be as early as February. AAX has, however, repeatedly said that “no decision on routes, whether to add new ones or cancel new ones'' had been made.

But those in the know claim that “all this adding and axing of routes is part of the understanding under the collaboration.'' Looking from the collaboration perspective, moving out of the European/India/Christchurch routes is seen as a compromise to get Sydney and some China routes.

MAS CEO Ahmad Jauhari Yahya in his executive summary of his business plan said that “we are close to finalising a connecting-service that will enable passengers on either airline to seamlessly connect between carriers and non-overlapping routes.”

Separately on Tuesday, AirAsia boss Tan Sri Tony Fernandes tweeted: “With all that's going on, we will need to get more planes. I will be speaking to the board. The growth in the low-cost arena is very exciting.''

Last Friday he was quoted in Paris as saying: “AirAsia will consider buying up to 25 Airbus A320 aircraft. Our growth will probably exceed the aircraft that we have right now, and the initial public offerings of AirAsia's units in Thailand and Indonesia will give us the ability to probably take more aircraft.''

*MB: Afterall the swapping of share between Air asia and MAS would be a win win situation. Closing some routes and compromising some routes between the two airlines, a total win-win that sets our airline industry even stronger in the international arena. What's the shout all about by the Union previously? Bunch of dumbnuts who cant foreseen the future.