UBM588 GROUP ASSIGNMENT

Assalammualaikum wrt and a very good morning. Live from MUASA TV, Im Nur Alia Nadira
as newscaster for today. Since end of December, China was affected by coronavirus then it
comes spreading widely including Malaysia. Malaysia was affected since end of December
2019 until today. Every industry was affected especially aviation. Not acceptable are
Malaysia Airlines and Air Asia. The statistic shows that both companies faced loss badly and
80% of the workers need to stop because of cannot returning the salary. COVID-19 threw all
Malaysia-based airlines a curveball this year, just as they were looking to the recovery of
their business after a tough 2019 financially amid overcapacity and fierce market
competition. The pandemic dealt a severe blow to the aviation industry not only here in
Malaysia but also globally, resulting in a battle for survival in a year dubbed “the worst year
in aviation history” by the International Air Transport Association (IATA). The casualties of
the pandemic include Malaysia Airlines and Air Asia. Both of companies have shed
thousands of jobs without government aid this year after grounding most of their planes
following the Movement Control Order (MCO) in March 2020 to preserve cash flow.

MAS

With the pandemic still showing little sign of improvement with a resurgence in some
markets and tight border restrictions remaining in place for its key markets, MAS announced
in October that it had reached out to its lessors, creditors and key suppliers as it embarked
on an urgent debt restructuring exercise. In the meantime, it has requested financial support
from its sole shareholder Khazanah Nasional Bhd as talks protract. Tengku Zafrul said there
were plans to restructure the liabilities of Malaysia Aviation Group Bhd (MAGB), the parent
group of the airline which is estimated to be RM16 billion. He said that the airline's earnings
had been impacted by the Covid-19 pandemic, with 75% of its aircraft grounded due to travel
restrictions. Malaysia Airlines offers unpaid leave for around 13,000 employees

NEWSCASTER: Let us live with CEO of Malaysia airlines, Dr. Aiman and Datin Mimi are
with me today virtually. Welcome to MUASA TV, thankyou Tan Sri and Dato’, We hearing
that all aviation need to stop because of the pandemic 19. Is that true? Can you share with
us what is the existing and potential risks that have the potential to cause your companies
harm?
SINGAPORE AIRLINES: Thank you Ms. Alia Nadira for the question. Based on the
statement made by Ms. Alia just now, it is undeniable that almost entire airlines industry is
affected by covid-19 pandemic outbreak. For the existing risk, it is clearly that the company
should bear the losses due to the cancellation ticket. However, for the potential risk, it is
clearly can be seen company profit could decline drastically.

NEWSCASTER: Can you explain more with us?

SINGAPORE AIRLINES: According to the statement regarding to the airlines aviation

industries, we cannot deny airlines industry are mostly affected due Movement Control Order
(MCO). Our company should bear high losses since some of our customers choose to have
a refund instead of to postpone their date travel. To reason why, they realized Movement
Control Order has cause travel restriction which allowed for business purpose only instead
for tourism activity abroad. Therefore, they think it is not worth it if they want to proceed with
the travel date.

Besides, regarding to the company’s profit, it is not impossible it will affect our company and
cause the profit to decline drastically if Movement Control Order is still continued for a long
time. To reason why, our company has loss our main sources of income to the company
since we cannot fly under some conditions such as for work travel. Thus, it cause us unable
to pay our workers’ salaries and it affects all our crews and workers also to lose their
incomes.

NEWSCASTER: Oh alright. Can you share with us how was your company eliminate all
these risks?

SINGAPORE AIRLINES:

As a result of the COVID-19 epidemic, Singapore Airlines offers all of their customers
benefits and discounts. The Singapore Stopover Holiday (SSH) is a collaboration between
Singapore Airlines, the Singapore Tourism Board, and Changi Airport. The package offers a
significant discount on your first stopover night in Singapore, with accommodation and
complimentary SIA Hop-On Bus trips starting at only £23. Choose from a variety of hotels
classified in different categories (A–K, with K denoting five-star establishments) to suit all
budgets. In fact, there's so much to do in Singapore that you might want to extend your
outward trip to a two- or three-night stay. You may still have a budget-friendly stay if you stay
in a B–C grade hotel. Boarding Pass Privileges, an Attraction Pass, and free unrestricted
use of the Sia Hop-On Bus are just a few of the amenities included with the SSH.
Then, in order to generate money, aviation sector operators in Singapore airlines are
introducing in-flight food services. Two Singapore Airlines flights have been transformed into
restaurants, providing guests with a unique opportunity to have lunch while watching a movie
in their seats. More than 400 people took advantage of the chance to go through the normal
security procedures at Changi Airport before boarding a Singapore Airlines flight for a lunch.
Singapore Airlines deserves a lot of credit for coming up with innovative ways to engage
consumers and generate money during these difficult times. While other airlines have
provided flights to nowhere, I like Singapore Airlines' idea of allowing passengers to eat
aboard the A380 without leaving the ground. It is both more ecologically friendly and more
cost-effective.
NEWSCASTER: Thank you for sharing with us the beneficial information. Now, let’s we
move to the Air Asia company.

AIRASIA

AirAsia X Bhd (AAX), the low-cost long-haul affiliate of AirAsia Group Bhd, posted its largest
quarterly net loss of RM5.67 billion for the quarter ended March 31, 2021 as revenue shrank
29.6% quarter-on-quarter to RM38.49 million as the majority of its aircraft fleet remained
grounded since mid-April last year amid the Covid-19 pandemic, apart from a limited number
of cargo and charter flights. The bigger net loss was mainly dragged by its other operating
expenses, which amounted to RM5.21 billion in the March quarter, from RM45.06 million in
the preceding quarter. These included rental of land, buildings and equipment, insurance
expenses and total impairment of receivables of RM337 million relating to lease rental and
maintenance reserve due from a joint venture through a third-party leasing intermediary.

The airline's cash pile has also depleted substantially over the past 15 months to RM84.64
million as at March 31, from RM307.62 million as at Dec 31, 2019.

In 2020, Air Asia has terminated the services of some 2,000 employees last year was a
tragedy, said by chief executive officer (CEO) Tan Sri Tony Fernandes

NEWSCASTER: Now, we are with Executive Director of Air Asia, Tan Sri Uezair and Dato’
Syahirah. Welcome to MUASA TV, thankyou Tan Sri and Dato’ for spending time with us, we
hearing that your company also affected with the pandemic 19. Is that true? Can you share
with us what is the existing and potential risks that have the potential to cause your
companies harm?

AIRASIA: Thank you Ms. Alia Nadira for the question. I cannot deny that question because it
is true that our company is among those that affected by the COVID-19 outbreak. For the
existing risk that AirAsia currently has to face is related to the cancellation of domestic flights
due to the announcement of the Malaysian Movement Control Order 3.0 (MCO 3.0). While
for the potential risk that will occur again in AirAsia Bhd, we are likely to lay off hundreds of
our employees due to loss of RM5.67 billion for the quarter ended March 31, 2021 in order to
stay afloat in an industry.

NEWSCASTER: Can you explain more with us?

AIRASIA: Based on the statement I made a moment ago about the cancellation of domestic
flights due to the announcement of the Malaysian Movement Control Order 3.0 (MCO 3.0).
This is because of the drastically increasing number of positive cases in Malaysia.
Therefore, the government had to implement MCO 3.0 where all citizens are not allowed to
travel within the country. It is the biggest challenge that we have to face. The thing that
worries me is the risk that AirAsia will face if a flight that has been booked by a customer is
subsequently delayed or cancelled due to restrictions imposed by the government with the
intention of curbing the spread of the COVID-19 outbreak, AirAsia airlines need to refund
back the money to the customer. Our airlines must comply with the laws that have been set
by MAVCOM which is under the Malaysian Aviation Commission Act 2015 [Act 771] and the
Malaysian Aviation Consumer Protection Code 2016.

Now, for the explanation of potential risk that our company will face which are to lay off
hundreds of our employees due to suffer greater losses that need to bear our company. Miss
Alia, as you mentioned a moment ago, AirAsia X Bhd (AAX) has recorded the largest
quarterly net loss of RM5.67 billion for the quarter ended March 31, 2021. Therefore, we
need to reduce our employees due to the COVID-19 outbreak. We are working hard to
maintain business continuity and at the same time try to retain as many employees as
possible according to the number of aircraft used. However unfortunately, we had to decide
to lay off some of our employees.

NEWSCASTER: Oh alright. Can you share with us how was your company eliminate all
these risks?
AIRASIA: Thank you Ms. Alia Nadira for the question addressed. Everything said by Dr.
Uezair is right where this Covid-19 is having a huge impact on our airline. Therefore, to
answer Ms. Alia's question on the issues mentioned by Tan Sri Uezair just now, with this I
will explain how we manage these problems and risks. First of all, what our company does is
we apply and ask our valued customers to receive ‘credit’ instead of refunds for flights
canceled as a result of the Covid-19 outbreak. So far over 80 percent of customers have
accepted credit as an option and we really appreciate it. While we strongly encourage our
customers to accept the credit given immediately and can be availed within 365 days in
addition to allowing them to change unlimited flight dates, we also accept requests for
refunds, and they are handled on a case-by-case basis. However, due to the very high
demand we receive, it will take a long time between 12 to 16 weeks.

Further, to address the problem or issue of hundreds of employees being retrenched

because our company suffered huge losses and could not afford to accommodate such a
large number of employees, we intend to take back our employees who had to be
retrenched last year following the impact of COVID-19, when business our airline is
recovering. However, this matter is still under observation as Malaysia is undergoing the
Movement Control Order 3.0. Thus, it is likely that the re-recruitment of our employees will
also be slow according to the current situation. Then, to ensure that AirAsia continues to be
in a breathing state, AirAsia employees will have to receive a salary reduction from 15
percent to 75 percent temporarily. This is to curb the losses suffered by our airlines and at
the same time to avoid the problem of layoffs on a large scale. I would like to thank the
employees for their sacrifice in understanding this in going through it together and would
also like to thank our dear customers for still believing in our services. That's all from me and
Tan Sri Uezair. Hopefully the question asked by Ms. Alia nadira is answered. Thank you for
inviting us to a virtual live broadcast.

NEWSCASTER: Thank you for sharing with us the beneficial information.