KUALA LUMPUR: Malaysia Aviation Group (MAG) may operate its own in-flight catering facility via a joint venture with a foreign in-flight catering company or buy out the remaining 70 per cent stake that it does not own in Brahim's Food Services Sdn Bhd (BFS).
MAG group managing director Datuk Captain Izham Ismail said the group is considering three options as its long-term plan to improve the in-flight meal services onboard Malaysia Airlines Bhd.
"MAG doesn't have catering expertise but we have an ambition. The ambition is having our own catering set up. Why do we want to do this? Customer is our centre of gravity. We have (had) so many issues for the last 10-15 years on food (quality, taste).
"Does MAG have the technical expertise? No, we don't. But there are professionals out there…to ensure long-term sustainability, MAG is seeking new service providers align with our commitments to elevate our in-flight dining experience, possibly including the establishment of in-house catering services ourselves," he said.
Izham was speaking to selective media organisations in an interview on Tuesday.
Currently, MAG is working with eight service providers, including its sister company MAS Awana Services Sdn Bhd and Pos Aviation Sdn Bhd to provide in-flight meals for Malaysia Airlines.
For the routes that were previously catered by BFS, the preparation of food is being done by the various service providers while the distribution of food to the aircraft is handled by MAG's ground handling unit, AeroDarat Services Sdn Bhd.
However, some international routes such as London, Tokyo, Doha and Kansai, are being catered and handled by Pos Aviation.
Speaking of a potential tie-up with a foreign in-flight caterer, Izham said it could be a possibility for MAG moving forward as many international in-flight caterers have expressed their interest to work with it.
He could not name these caterers at the moment as the option is under discussion.
However, he hinted that the joint venture could either be to build MAG's own catering facility or possibly to buy out the 70 per cent stake in BFS in order for it to have a controlling stake in its in-flight catering division.
ALthough the in-flight catering agreement between BFS and MAG had ended on Aug 31, the latter still holds a 30 per cent stake in the in-flight catering company.
The New Straits Times (NST) had reported on Aug 23 that MAG could take over BFS by purchasing the remaining 70 per cent stake for up to RM129 million, excluding any goodwill.
BFS, in an interview with the NST, had said that it was ready to sell the shares to MAG and let the latter run its in-flight kitchen facility in Sepang together with its manpower, experience and foreign airline clients.
Izham said he could not discuss about the value of the buy-out due to the non-disclosure agreement signed.
When asked if MAG would consider working together with BFS again as one of its options, Izham said it is imperative for the group to reset its fundamentals to ensure its long-term sustainability and profitability.
"We felt very strongly (that) it is time. It is time for us to pull the plug. We need to move on. The decision (made) by the management and the board is final. There is no turning back for us," Izham added.
Speaking on the impact of the end of the BFS partnership on MAG's airline business, Izham said the group is going through a journey of transition.
"MAG needs to be profitable and we have to reset unbalanced legacy contracts. This is a phase of transition. Bear with us. Malaysia Airlines has suffered poor quality meals and (now) we want to take the meal to the next level and the journey of change is what it's experiencing now and it will be short-term," Izham said.