CONFIDENTIAL
CONDITIONS AND CLOSE CAPACITY CONTROL OF THE LOW FARE ELEMENT
F CAPACITY WERE ESSENTIAL PREREQUISITES IN ORDER TO
ACHIEVE THE NECESSARY HIGH SEAT FACTORS TO MAKE THE FARES ECONOMIC.
3A ESTIMATED THAT THE INTRODUCTION OF SUCH FARES WOULD NOT ONLY
GENERATE TRAFFIC BYT WOULD ALSO EN ABLE BA AN MAS TO RETRIEVE SOME OF THE TRAFFIC PRESENTLY CARRIED BY OTHER AIRLINES. MAS HAD
FELT UN ABLE TO AGREE TO THE BA PROPOSALS AND WISHED TO HAVE A LEVEL
SOME 200 MALAYSIAN DOLLARS HIGHER THAN THE AVERAGE FARE PROPOSED BY BA. ROGERS SAID THERE WAS A PUBLIC EXPECTATION OF LOWER FARES AND POINTED ALSO TO THE NEED FOR CLOSE RELATIONSHIP BETWEEN KUALA LUMPUR/LONDON FARES AND SINGAPORE/LONDON FARES. THE MALAYSIANS
WERE NOT DISPOSED TO CONTINUE DISCUSSION ON ARES BUT IT WAS
NOTEABLE THAT IN PAPERS THEY SUBSEQUENTLY PRESENTED ON TRAFFIC
PREDICTIONS THEY MADE AN ALLOWANCE FOR TRAFFIC GENEFATION PREDICATED
ON ACCEPTANCE OF BA'S PROPOSALS.
7. WHEN DISCUSSION RESUMED ON 8 FEBRUARY THE PREDICTIONS OF TRAFFIC LIKELY TO BE AVAILABLE TO ABA AND MAS ON THE TRUNK ROUTE IN 1979/1980 AND THE ASSUMPTIONS UNDERLYING THOSE PREDICTIONS WERE FURTHER EXAMINED. REFERENCE TO IMMIGRATION STATISTICS
DID NOT PROVE HELPFUL IN RESOLVING DIFFERENCES OVER THE KUALA LUMPUR TO LONDON AND VECE VERSA TRAFFIC WHICH GOES OVER SINGAPORE. ON THIS AND OTHER ASSUMPTIONS WHERE THE TWO AIRLINES DIFFERED, THE AIRLINES USED THEIR RESPECTIVE ASSUMPTIONS IN ARRIVING AT THEIR PREDICTIONS OF TOTAL TRAFFIC LIKELY TO BE SECURED BY THE TWO CARRIERS JOINTLY. HOWEVER, DUE TO OFF-SEFTING DIFFERENCES, SURPRISINGLY LITTLE DIFFERENCE EMERGED BETWEEN THE RESPECTIVE TOTALS. CONTRARY TO THEIR EARLIER STRONGLY HELD VIEWS THAT THEY SHOULD HAVE ENTITLEMENT TO THE PERCENTAGE OF TOTAL TRAFFIC THAT THEY HAD HISTORICALLY ACHIEVED, IN ALL THE LATER EXERCISES MAS QUIETLY ACCEPTED A 50:50 SHARING ENTITLEMENT.
3. ON THE OTHER HAND, WHEN IT CAME TO TRANSLATING TRAFFIC PREDICTIONS INTO CAPACITY ENTITLEMENT THERE WERE SUBSTANTIAL DIFFERENCES,
WHICH COULD NOT BE RESOLVED, REGARDING
A, THE ALLOWANCE TO BE MADE FOR INTERMEDIATE AND BEYOND OWN
THIRD/FOURTH TRAFFIC SEMI COLON AND
B. THE PLANNING SEAT FACTORS TO BE USED.
IN CONSEQUENCE MAS TRUNK ENTITLEMENT AS WORKED OUT BY BA CAME TO 2.3 DC12 FREQUENCIES PER WEEK WHILE THAT WORKED OUT BY MAS
CAME TO 3.8 DC10 FREQUENCIES. HAMZAH PRESSED FOR THESE DIFFERENCES
3
CONFIDENTIAL
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