11 Dec New name, new board, $500m overhaul for national carrier

Written by Tim McLaughlin Published in Service Read 4052 times
U Than Tun, managing director of Myanmar National Airlines speaks during a press conference at the Myanmar National Airlines office at Strand Road, Kyauktada Township in Yangon on December 10, 2014. Photo: Thet Ko/Mizzima U Than Tun, managing director of Myanmar National Airlines speaks during a press conference at the Myanmar National Airlines office at Strand Road, Kyauktada Township in Yangon on December 10, 2014. Photo: Thet Ko/Mizzima

Myanmar’s state-owned airline, Myanma Airways, will undergo a sweeping half a billion-dollar overhaul as the carrier looks to upgrade its domestic service and eyes expansion to international destinations.

The ambitious move comes as Myanmar’s tourism and business travel sector continues to show strong growth, with the country’s flag carrier hoping to shake its poor reputation and compete in an increasingly crowded field of carriers servicing Myanmar.

Myanma Airways announced on December 10 that it had rebranded as Myanmar National Airlines (MNA). The company, one of four state-owned enterprises under the Ministry of Transportation, has also corporatised in an effort to operate more independently of Nay Pyi Taw.

Though the airline will remain under government ownership, a new board of directors is being formed to grant to company more autonomy. Officials said this “semi-state-owned” structure would cut bureaucracy and leave the door open for potential future investment in the company from outside parties.

“We will be able to provide strong leadership of the airline, look at it from a commercial perspective and to make our own decisions about company strategy and direction,” MNA managing director U Than Tun said on December 10.

Myanmar welcomed more than 2 million visitors in 2013, up more than 90 percent from the previous year, said the Ministry of Hotels and Tourism, and is aiming to attract 5 million arrivals in 2015.

MNA is keen to tap into this influx but the airline has been tainted in the past by its unreliability and spotty safety record.

To address chronic delays, MNA will launch a fixed flight schedule on December 15. MNA had previously used a flexible schedule that often resulted in passengers being stranded at airports with only a general idea of when flights might arrive or depart.

MNA will also begin using a computerised management system to improve reservations and a website to allow for online reservations. The airline could launch international services as early as next year.

The upgrades will cost about US$500 million over seven to eight years, said Cronan Enright, a principal consultant with Avia Solutions, the GE-owned aviation consultancy working with MNA on the project.

MNA is also expanding and modernising its fleet of 10 aircraft to improve safety standards.

The airline signed a deal in February with GE Capital Aviation, the aircraft leasing arm of General Electric, to lease six Boeing 737-800 and four 737-8MAX jets. The aircraft are scheduled for delivery in July 2015.

An additional six ATR 72s will be acquired next year, as part of a deal signed in July.

The airline’s last crashes were in 2003. Both were minor incidents involving planes skidding off runways while landing, shows data compiled by the Aviation Safety Network.

The airline’s most serious incidents occurred in the late 1990s: five crashes between 1996 and 1999 left 68 people dead.

Formed shortly after independence in 1948 as Union of Burma Airlines, MNA is Myanmar’s longest running airline, but has faced increased competition since the country’s reforms began in 2011.

Yangon welcomed flights from 25 different carriers in 2014, up from just 16 in 2012, said Colliers International.

Domestic airlines Golden Myanmar, Mann Yadarnaborn Airlines and FMI’s chartered service have all launched in the past two years. FMI, backed by tycoon Serge Pun, is slated to expand in December following the acquisition of three aircraft.

Another airline, Apex, is awaiting final approval from the Myanmar Investment Commission.