Consumer

Andy Mukherjee is a Bloomberg Gadfly columnist covering industrial companies and financial services. He previously was a columnist for Reuters Breakingviews. He has also worked for the Straits Times, ET NOW and Bloomberg News.

Malaysia Airlines seems to be at least as successful in courting PR disasters as it has been unlucky in avoiding real ones. Barely months after losing two planes and 537 lives in successive air tragedies, the carrier ran a "My Ultimate Bucket List" contest for passengers before social media outrage forced it to jettison the campaign.

And now, a year after it was nationalized, the Southeast Asian airline has done something crazier still: it banned check-in baggage on some long-haul flights to Europe, before a storm of ridicule on Twitter and Facebook forced it to change its mind.

The reason given for the short-lived prohibition was "unseasonably strong headwinds," which ostensibly are making it tougher for Malaysia Air to reach western Europe. Add to that the longer routes the carrier flies because one of its jets was shot down over war-torn Ukraine, and it had a plausible, though not entirely believable, safety defense for asking travelers to hop on a Kuala Lumpur-to-Paris flight with just a hand-carry bag (or two, if they weren't flying coach).

But even if customers think the move was a desperate penny-pinching ploy, there are several reasons why Chief Executive Officer Christoph Mueller, who took over last March, shouldn't lose much sleep over the fiasco.

For one, the bar for what's considered bad behavior by a state-owned flag carrier is notoriously high in Asia, including media reports last year of an Air India pilot and co-pilot coming to blows in the cockpit.

Getting roasted on social media would be an especially strong deterrent for a publicly traded airline, or one with even half a hope of an IPO. But Mueller is free of that encumbrance. Khazanah Nasional, the sovereign wealth fund that now owns Malaysia Air, probably has no intention of floating it any time soon, certainly not before the carrier, which cut thousands of jobs last year and shed capacity, has successfully transformed itself into a short-haul regional service.   

And that leads to the most important reason why the airline's management and its sole shareholder can afford to ignore the PR fiasco. It's painfully clear that on the so-called Australasia-to-Europe "kangaroo route" Malaysia Air can't provide a viable long-term alternative to the strong Qantas-and-Emirates collaboration on one side, and Singapore Airlines and its Star Alliance partners on the other.  Mueller has already decided to drop direct flights to Paris and Amsterdam, and agreed to a massive code-share deal with Emirates. If the absurd checked baggage ban was his way of telling Malaysian politicians the flag carrier needs to beat a hasty retreat from unprofitable long-haul routes, then he might even have scored a coup.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

To contact the author of this story:
Andy Mukherjee in Singapore at amukherjee@bloomberg.net

To contact the editor responsible for this story:
Katrina Nicholas at knicholas2@bloomberg.net