Macau Asia Express
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MAX: The Full Sorry Tale - in five acts
Here it is. The tale of Macau Express in five acts.
Prologue: In a galaxy far, far away NX/CNAC realise that the aviation environment may be changing. They have heard tales of a planet "Low Cost" and an Australian emissary tries to persuade them to embrace the future. They think about it briefly; refuse and return to their shark's fin soup.
1. Act One, 2005: NX/CNAC is under governmental pressure again to develop Macau's aviation scene. They come up with a cunning plan: keep the best routes for themselves and then issue three sub-concessions (the second-best routes for their own start up Macau Express, then some short-haul ones for a friend of the family (who they don't expect to use them) and then the remaining dross to an annoying newcomer Viva. NX seniors actually chuckle during the signing ceremony of Viva's routes (Moresby, Christchurch, Lisbon, Male etc).
2. Act Two, 2005: For their own sub-concession new airline NX/CNAC needs to look a bit "new" so they ask in Shun Tak as a shareholder. Lots of talk about leveraging the core excellence of the combined owners (?). Shun Tak doesn't really understand what it is getting into but Pansy knows best, and who dares to disagree? NX management in Macau not very keen but they hope it will just go away if they close their eyes (in the same way that AACM insistence on action normally does). CNAC figures too busy snoozing to actually look at a spreadsheet and work out that their plan will haemorrage cash.
3. Act Three, 2006: Viva being a nuisance by actually trying to get into the air, somehow finding ongoing if suicidal financial support through backing of another local Family. CNAC takes an afternoon off from snoozing to employ a leading LCC CEO from Europe for their own Macau Express start-up. Leading CEO does not understand that he must kow tow to shareholders, even if they know next to nothing about operating an airline, and quits after three months. CNAC is annoyed by the whole experience and sources a more "culturally-aware" team from KA.
4. Act Four, mid 2007: Macau Express start-up plans move forward, albeit not particularly impressively. Strangely a binding commitment for six old Japanese aircraft is signed. However, major changes in Beijing (CX takeover of KA) means that CNAC geriatrics in Hong Kong and Macau begin to lose power and patronage. Air China now begins to ask questions of CNAC as to why two loss making airlines in Macau would be better than one. KA team not sure which shareholding group to please. NX management is delighted and stirs things up by offering to support in all areas. A five minute review of their capabilities highlights that this is disingenuous.
5. Act Five, late 2007: Everything on hold. Shun Tak realises it is a minority shareholder in an airline which the majority owners don't actually want. Pansy stomps her expensive shoes. Beijing tells her to bugger off. KA management team realises it is deep in the **** and maybe the Leading CEO had a point so they focus on their own futures. NX still desperate to "help". Their grins weaken when Air China insists that they take on most of the six outdated A320s and hand over their newer equipment to Beijing. KA team departs.
Epilogue: The efforts shift to working out how to pretend that the sub-concession routes will be operated by an "independent" carrier. NX and Air China begin to lobby AACM to allow for (depending on the day of the week) two carriers, one AOC or one AOC, two carriers. NX prepares for "takeover" of Macau Express (in effect inheriting a half-finished AOC and six, difficult-to-maintain aircraft). Everyone else laughs.
Prologue: In a galaxy far, far away NX/CNAC realise that the aviation environment may be changing. They have heard tales of a planet "Low Cost" and an Australian emissary tries to persuade them to embrace the future. They think about it briefly; refuse and return to their shark's fin soup.
1. Act One, 2005: NX/CNAC is under governmental pressure again to develop Macau's aviation scene. They come up with a cunning plan: keep the best routes for themselves and then issue three sub-concessions (the second-best routes for their own start up Macau Express, then some short-haul ones for a friend of the family (who they don't expect to use them) and then the remaining dross to an annoying newcomer Viva. NX seniors actually chuckle during the signing ceremony of Viva's routes (Moresby, Christchurch, Lisbon, Male etc).
2. Act Two, 2005: For their own sub-concession new airline NX/CNAC needs to look a bit "new" so they ask in Shun Tak as a shareholder. Lots of talk about leveraging the core excellence of the combined owners (?). Shun Tak doesn't really understand what it is getting into but Pansy knows best, and who dares to disagree? NX management in Macau not very keen but they hope it will just go away if they close their eyes (in the same way that AACM insistence on action normally does). CNAC figures too busy snoozing to actually look at a spreadsheet and work out that their plan will haemorrage cash.
3. Act Three, 2006: Viva being a nuisance by actually trying to get into the air, somehow finding ongoing if suicidal financial support through backing of another local Family. CNAC takes an afternoon off from snoozing to employ a leading LCC CEO from Europe for their own Macau Express start-up. Leading CEO does not understand that he must kow tow to shareholders, even if they know next to nothing about operating an airline, and quits after three months. CNAC is annoyed by the whole experience and sources a more "culturally-aware" team from KA.
4. Act Four, mid 2007: Macau Express start-up plans move forward, albeit not particularly impressively. Strangely a binding commitment for six old Japanese aircraft is signed. However, major changes in Beijing (CX takeover of KA) means that CNAC geriatrics in Hong Kong and Macau begin to lose power and patronage. Air China now begins to ask questions of CNAC as to why two loss making airlines in Macau would be better than one. KA team not sure which shareholding group to please. NX management is delighted and stirs things up by offering to support in all areas. A five minute review of their capabilities highlights that this is disingenuous.
5. Act Five, late 2007: Everything on hold. Shun Tak realises it is a minority shareholder in an airline which the majority owners don't actually want. Pansy stomps her expensive shoes. Beijing tells her to bugger off. KA management team realises it is deep in the **** and maybe the Leading CEO had a point so they focus on their own futures. NX still desperate to "help". Their grins weaken when Air China insists that they take on most of the six outdated A320s and hand over their newer equipment to Beijing. KA team departs.
Epilogue: The efforts shift to working out how to pretend that the sub-concession routes will be operated by an "independent" carrier. NX and Air China begin to lobby AACM to allow for (depending on the day of the week) two carriers, one AOC or one AOC, two carriers. NX prepares for "takeover" of Macau Express (in effect inheriting a half-finished AOC and six, difficult-to-maintain aircraft). Everyone else laughs.
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Second book?
Given the local political pressure, I do foresee more flights - esp as we move into next year with more of Cotai being developed and more conventions. Macao certainly needs more flights.
It will be interesting to see if NX keeps turning away growth and new routes (or continuing to cut routes because its focused on China/cross-straits and not SE Asia).
...or whether VIVA will be allowed by the politicians to take up the routes NX refuses to fly
...or whether other flag carriers and LCCs take up the slack. Witness recent MFM schedule addditions by Cebu (Clark), Air China (PEK), China Eastern (PVG), Air Asia (Kuching, Kota K), Malaysian (KUL)...
...or all of the above. For sure, there are going to be some big changes coming in the local status quo.
It will be interesting to see if NX keeps turning away growth and new routes (or continuing to cut routes because its focused on China/cross-straits and not SE Asia).
...or whether VIVA will be allowed by the politicians to take up the routes NX refuses to fly
...or whether other flag carriers and LCCs take up the slack. Witness recent MFM schedule addditions by Cebu (Clark), Air China (PEK), China Eastern (PVG), Air Asia (Kuching, Kota K), Malaysian (KUL)...
...or all of the above. For sure, there are going to be some big changes coming in the local status quo.
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Macau Asia Express in the Press
Macau Daily News
Date: 10Nov07
Title: Macau Asia Express suffered a setback. CA hesitated for funding the airline and some management team menber resigned.
[FONT=Arial]Content: Air Macau, Air China and Shun Tak incorporated Macau Asia Express suffered a major setback in the establishment, for allegedly falling short of funding from Air China. According to source from the circle, a few of senior management team members, including the Chief Operation Officer and Commercial Head, were resigned already. Some around thirty staff were on duty as usual but the airline official website was suspended. MAE was granted 11 mainland routes and 11 regional routes by AACM and committed the lease of 6 A320. MAE planed to fly Ho CHih Minh and Clark in the first phase. Nagaya, Kitakyushu, Japan and Hangzhou, Tinjing, China are on their routes plan as well. It was believed if CA's withdrawal suspended the operation of MAE, the leased 6 aircrafts would be handled by Air Macau.
Source from Apple Daily
Date: 10Nov07
Title: Macau Asia Express suffered a setback. CA hesitated for funding the airline and some management team menber resigned.
[FONT=Arial]Content: Air Macau, Air China and Shun Tak incorporated Macau Asia Express suffered a major setback in the establishment, for allegedly falling short of funding from Air China. According to source from the circle, a few of senior management team members, including the Chief Operation Officer and Commercial Head, were resigned already. Some around thirty staff were on duty as usual but the airline official website was suspended. MAE was granted 11 mainland routes and 11 regional routes by AACM and committed the lease of 6 A320. MAE planed to fly Ho CHih Minh and Clark in the first phase. Nagaya, Kitakyushu, Japan and Hangzhou, Tinjing, China are on their routes plan as well. It was believed if CA's withdrawal suspended the operation of MAE, the leased 6 aircrafts would be handled by Air Macau.
Source from Apple Daily
:sad : in one post. 
MAX dead?
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Oxymoron
Arrowhead,
You may be right, but I doubt it (despite your record to date on this forum where you have been the best forecaster).
NX and management is an oxymoron - whether resting or not! I believe the AACM may be belatedly regulating and realise that what NX are proposing for Macau Express is just plain unacceptable or even potentially unsafe.
I am not certain that Viva would be able to get their hands on NX routes unless the Govt come to the party and get rid of this whole iniquitous concession system. Ironically Viva now looks like the best managed airline (real or imagined) in Macau, which is an interesting indictment of the place!
The real intrigue behind the scenes is undoubtedly the in-fighting between the share holders. The Shun Tak lot look set to lose a bundle on their investment, which they will not take lying down; the Air China attempt to arrogantly steam roller everybody seems to be losing steam; the so called Chairman of Macau Express is a discredited man whose protestations to the staff that nothing has changed would be laughable if not so serious for the remaining employees.
I just can not see this phoenix rising from the ashes - a sad case of self immolation. It is a potentially interesting case for the business school types - if an airline has capital, political influence, guaranteed routes and a sympathetic regulator can it fail? We know the answer now - but it took great political skill and management/ board ineptitude to snatch defeat from the jaws of this one!!!
Air Macau management's victory over Macau Express may yet prove to be Pyrrhic!
Hailer
You may be right, but I doubt it (despite your record to date on this forum where you have been the best forecaster).
NX and management is an oxymoron - whether resting or not! I believe the AACM may be belatedly regulating and realise that what NX are proposing for Macau Express is just plain unacceptable or even potentially unsafe.
I am not certain that Viva would be able to get their hands on NX routes unless the Govt come to the party and get rid of this whole iniquitous concession system. Ironically Viva now looks like the best managed airline (real or imagined) in Macau, which is an interesting indictment of the place!
The real intrigue behind the scenes is undoubtedly the in-fighting between the share holders. The Shun Tak lot look set to lose a bundle on their investment, which they will not take lying down; the Air China attempt to arrogantly steam roller everybody seems to be losing steam; the so called Chairman of Macau Express is a discredited man whose protestations to the staff that nothing has changed would be laughable if not so serious for the remaining employees.
I just can not see this phoenix rising from the ashes - a sad case of self immolation. It is a potentially interesting case for the business school types - if an airline has capital, political influence, guaranteed routes and a sympathetic regulator can it fail? We know the answer now - but it took great political skill and management/ board ineptitude to snatch defeat from the jaws of this one!!!
Air Macau management's victory over Macau Express may yet prove to be Pyrrhic!
Hailer
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Congratatulations to Hailer for what must be the first usage of "pyrrhic" on Pprune....
I agree with the rest of his message but remain dubious about Viva's long term viability (although probably slightly less dubious than I was six months ago). They must grow quickly and to do this they need more aircraft - and more funding. Most serious investors are not going to touch them until they see more clarity in the regulatory environment, so they will have to rely on their existing shareholders to keep them going for some time ahead. If they can do that, perhaps they will have a chance - although this depends on when NX melts down.
My guess is that Air China has enough clout in Macau to hold Viva back from getting the decent routes on a scheduled basis, even when NX melts down, through pressurizing the government locally through its Beijing representatives. Plus Edmund Ho will not do anything too radical in his last years in office, especially as his family has a holding in Viva and Ao Man Long has made traditional Macau business practices rather more sensitive. The new Chief Executive is also unlikely to rock the boat during his first year in office.
And even if all this is wrong and the concession collapses and it is every man for himself, the largest "newcomer" beneficiary will be the Venetian - who I understand is still working on the Macau SARG to allow a far more substantial operation than Part 91 alone would permit. In employing a double digit percentage of the Macau working population, as well as contributing a serious percentage of its tax revenue, they are going to have a lot more leverage than most.
Anyway, no more predictions on Macau aviation. I leave it to the experts...if you can find any.
I agree with the rest of his message but remain dubious about Viva's long term viability (although probably slightly less dubious than I was six months ago). They must grow quickly and to do this they need more aircraft - and more funding. Most serious investors are not going to touch them until they see more clarity in the regulatory environment, so they will have to rely on their existing shareholders to keep them going for some time ahead. If they can do that, perhaps they will have a chance - although this depends on when NX melts down.
My guess is that Air China has enough clout in Macau to hold Viva back from getting the decent routes on a scheduled basis, even when NX melts down, through pressurizing the government locally through its Beijing representatives. Plus Edmund Ho will not do anything too radical in his last years in office, especially as his family has a holding in Viva and Ao Man Long has made traditional Macau business practices rather more sensitive. The new Chief Executive is also unlikely to rock the boat during his first year in office.
And even if all this is wrong and the concession collapses and it is every man for himself, the largest "newcomer" beneficiary will be the Venetian - who I understand is still working on the Macau SARG to allow a far more substantial operation than Part 91 alone would permit. In employing a double digit percentage of the Macau working population, as well as contributing a serious percentage of its tax revenue, they are going to have a lot more leverage than most.
Anyway, no more predictions on Macau aviation. I leave it to the experts...if you can find any.
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Sorry I have been so slow to reply - took me a while to look up "pyrrhic" in the dictionary....
Hailer - I can confirm NX mgmt are still pursuing MX AOC. Fact. I believe (but am not sure) that NX is taking the first 2 of the 6 aircraft, with the rest going to Beijing. What NX will do with 2 aircraft is unclear, moreso since it is the incredible shrinking airline with pax numbers down yoy (despite operating a monopoly in the worlds fastest growing economy). Perhaps they need to take 2 acft, to later give them to MX, for the AACM to believe MX still has a future (you need 2 acft for the AOC). However, I can only guess they will wet lease these to Air China. NX is currently doing a large number of upgrades and new FO training, so really does look like they are taking the 2 acft.
If PEK, PVG and TPE really are on the MX concession (its a secret remember), they have to keep MX alive for the reasons already stated. There must be a powerful legal case for VIVA to claim those routes if there are no other airlines in Macau. Thats a legal argument, not a "changing the rules" argument.
That said, I am sure VIVA is also lobbying the govt to change the concession rules, since the concession lies with the government (not NX), and the goverment is under pressure to fill up the casinos and hotels. Transport infrastructure is now a political priority since Ao Man Long went ($$$
) and now you can no longer get a ferry to Macau (old terminal) without buying your ticket in advance... Edmund Ho could go out with a bang (or puff) by dergulating aviation before he leaves (and thereby increasing his familys personal wealth), or his replacement could start with a productive bang/puff. We'll see.
For the record, I think you are way too harsh on VIVA operating mgmt. They have made enormous strides given a very tight environment, esp now with SYD, NRT, Ho Chi Minh, Busan, Jakarta etc - only 1 of which was on the original concession.
I dont really get the point on Air China holding back VIVA on the decent routes. SYD, JKT doing well, and VIVA has already annouced Narita and Ho Chi Minh. So whatever holding back there has been (and NX has tried hard), it has not been effective. What is there left to hold back now? PVG and TPE maybe? But I am not sure VIVA wants a full on war with NX. more Japan and more Oz flights would make more sense for VIVA.
The real question on VIVA is that now the wet lease (read cashflow, or profit) is coming to an end, will they get the pax numbers from Vietnam and Japan to keep their heads above water? They already have "serious investors", and I doubt they will have any problems finding more funding, since the original plan cannot have been for 2 acft - and the macro picture has developed towards the top end of expectations. The regulatory environment is also a huge opportunity for them, should the govt freely open up the market. It cant get worse, unless SYD is pulled. But I cant see that looking good for the govt.
No, their issue is can they get the pax and then more acft to fly to more destinations in Japan and Oz? Clearly they have been trying for some time. We'll just have to see. Meanwhile I cant see NX "melting down" unless cross-strait flights start. Indeed, Perhaps the greatest threat to VIVA is NX getting a new CEO, who starts flying medium-haul.
p.s. As an ex-"business school type" myself, MX was screwed from the get go, as per previous posts. It was never meant to fly... It was a solution to an NX problem. The problem is still there, ergo MX is still there (just). It was just cheaper to screw it now, than let it launch.....
Roll on the planned Twotter operation....
Hailer - I can confirm NX mgmt are still pursuing MX AOC. Fact. I believe (but am not sure) that NX is taking the first 2 of the 6 aircraft, with the rest going to Beijing. What NX will do with 2 aircraft is unclear, moreso since it is the incredible shrinking airline with pax numbers down yoy (despite operating a monopoly in the worlds fastest growing economy). Perhaps they need to take 2 acft, to later give them to MX, for the AACM to believe MX still has a future (you need 2 acft for the AOC). However, I can only guess they will wet lease these to Air China. NX is currently doing a large number of upgrades and new FO training, so really does look like they are taking the 2 acft.
If PEK, PVG and TPE really are on the MX concession (its a secret remember), they have to keep MX alive for the reasons already stated. There must be a powerful legal case for VIVA to claim those routes if there are no other airlines in Macau. Thats a legal argument, not a "changing the rules" argument.
That said, I am sure VIVA is also lobbying the govt to change the concession rules, since the concession lies with the government (not NX), and the goverment is under pressure to fill up the casinos and hotels. Transport infrastructure is now a political priority since Ao Man Long went ($$$
) and now you can no longer get a ferry to Macau (old terminal) without buying your ticket in advance... Edmund Ho could go out with a bang (or puff) by dergulating aviation before he leaves (and thereby increasing his familys personal wealth), or his replacement could start with a productive bang/puff. We'll see. For the record, I think you are way too harsh on VIVA operating mgmt. They have made enormous strides given a very tight environment, esp now with SYD, NRT, Ho Chi Minh, Busan, Jakarta etc - only 1 of which was on the original concession.
I dont really get the point on Air China holding back VIVA on the decent routes. SYD, JKT doing well, and VIVA has already annouced Narita and Ho Chi Minh. So whatever holding back there has been (and NX has tried hard), it has not been effective. What is there left to hold back now? PVG and TPE maybe? But I am not sure VIVA wants a full on war with NX. more Japan and more Oz flights would make more sense for VIVA.
The real question on VIVA is that now the wet lease (read cashflow, or profit) is coming to an end, will they get the pax numbers from Vietnam and Japan to keep their heads above water? They already have "serious investors", and I doubt they will have any problems finding more funding, since the original plan cannot have been for 2 acft - and the macro picture has developed towards the top end of expectations. The regulatory environment is also a huge opportunity for them, should the govt freely open up the market. It cant get worse, unless SYD is pulled. But I cant see that looking good for the govt.
No, their issue is can they get the pax and then more acft to fly to more destinations in Japan and Oz? Clearly they have been trying for some time. We'll just have to see. Meanwhile I cant see NX "melting down" unless cross-strait flights start. Indeed, Perhaps the greatest threat to VIVA is NX getting a new CEO, who starts flying medium-haul.
p.s. As an ex-"business school type" myself, MX was screwed from the get go, as per previous posts. It was never meant to fly... It was a solution to an NX problem. The problem is still there, ergo MX is still there (just). It was just cheaper to screw it now, than let it launch.....
Roll on the planned Twotter operation....
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Pilot Jobs Macau Asia Express
I applied with Macau Asia Express and got a prompt reply from a Chiefpilot with an english Name.
I filled out the application promptly...and that was it...........never heard ANYTHING back.
Is this outfit dead.....never got off the ground?
I filled out the application promptly...and that was it...........never heard ANYTHING back.
Is this outfit dead.....never got off the ground?
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Hi guys!!
Someone knows what happened with this company(Macau Express) finally???
I'll be gratefuly if somebody can give me any information about this..
Thank you so much in advanced.
Someone knows what happened with this company(Macau Express) finally???
I'll be gratefuly if somebody can give me any information about this..
Thank you so much in advanced.
