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Singapore, Malaysia Airlines in revenue-sharing deal

Singapore Airlines and Malaysia Airlines have hammered out a revenue-sharing agreement as the Malaysian carrier struggles to bounce back after suffering two air disasters in 2014.

The ‘wide-ranging’ agreement will share revenue on flights between Singapore and Malaysia and expand codeshare routes, among other initiatives, according to a joint statement by the carriers on Wednesday.

However, the revenue-sharing is still subject to regulatory approval, the statement said.

Under the terms of the codeshare expansion, Singapore and its subsidiary carrier SilkAir will codeshare on Malaysia Airline’s domestic flights to serve a total of 16 destinations in Malaysia – a fourfold increase from four destinations previously.

In exchange, Malaysia Airlines will progressively codeshare on flights between Singapore and Malaysia, Europe, South Africa and other destinations, subject to regulatory approval.

In addition, the airlines plan to development airpasses enabling customers travelling through either country to visit other parts of Malaysia such as Kuantan, Kuching and Kota Kinabalu on a single ticket.

The move comes amidst financial worries at Malaysia Airlines, which has struggled to return to profitability after two air disasters in 2014 – the unexplained disappearance of MH370 with 239 passengers onboard, and the fatal shooting down of MH17 over eastern Ukraine, carrying 298 people.

In March, Malaysian Prime Minister Mahathir Mohamad said the government was considering shutting, selling or refinancing the loss-making national carrier.

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