Malaysia Airlines CEO's Unenviable Job: Dealing With MH17 and MH370 Disasters

Malaysia Airlines Chief Executive Officer (CEO) Ahmad Jauhari Yahya
Malaysia Airlines CEO Ahmad Jauhari Yahya speaks to journalists during an interview at a hotel in Kuala Lumpur April 5, 2014, four weeks after the disappearance of Malaysia Airlines Flight MH370. REUTERS/Samsul Said (MALAYSIA - Tags: DISASTER TRANSPORT)

When the CEO of Malaysia Airlines took control of the company in September 2011, he inherited the difficult task of stemming the carrier’s massive losses and bringing it back into the black.

If his predecessors thought that was a painful and unenviable task, it was nothing compared with what followed: Two major crashes in a four-month period -- MH370, which disappeared en route to Beijing in March, and Thursday's crash of Flight MH17 in Ukraine, apparently a result of sabotage.

CEO Ahmad Jauhari, 59, is now dealing with issues of an unprecedented scale for any airline and, perhaps, any company, which will almost certainly derail his plans to return the company to profitabilty, and, according to airline analyst Ted Gavin in a CNN interview on Wednesday, could bring Malaysia Airlines down.

The tough and physically fit CEO, who graduated from Malaysia's Royal Military College and Nottingham University in the U.K., became an Ironman competitor in 2003 and is known as “AJ” by his corporate contemporaries, had been slowly rebuilding the beleaguered airline’s brand after MH370 went down March 8. The company was widely criticized for its handling of the crisis and its awkward and sometimes insensitive-seeming interactions with victims' families.

Jauhari reportedly had been making plans to take the company private as a first step to restructuring it. But Thursday’s tragedy is likely to scotch those plans as the company will have to deal with the financial aftermath, chiefly because of the likely increase in cancellations, share price drop and lower bookings, similar to what happened after MH370 was lost.

Jauhari's professional future also hangs in the balance. Though his contract expires in August, analysts quoted in the Malaysia Chronicle predict he will stay on and guide the company through the crisis. That remains to be seen; according to the March 31 Business Times, he was rumored to be considering leaving in 2012 due to the company's overwhelming financial problems.

Until the two crashes, Jauhari's résumé appeared untarnished and impressive. After returning from the University of Nottingham with a Bachelor of Science degree in electrical and electronic engineering, he started his career with ESSO Malaysia before joining Kuala Lumpur's New Straits Times Press, where he rose to become its senior group general manager in 1990. Two years later, he joined Time Engineering as deputy managing director in 1992 and rose to managing director later that year.

In the mid-1990s he worked for Malakoff, a global power and water company, where he stayed for more than 15 years. He later said he left because he was tired of working for a public company subject to “meddling” by shareholders, according to a March 2014 Business Times report.

Jauhari then served as managing director of a series of Malaysian and international companies involved in oil and gas, publishing, engineering and energy production, before accepting the challenge to turn Malaysia Airlines around.

The airline is the fourth largest in Southeast Asia by market value, and after three government bailouts and numerous restructuring attempts of the brand during nearly 20 years, Malaysian Prime Minister Najib Razak personally asked Jauhari to take over the company, of which the government is majority owner. Jauhari was initially reluctant, but after a third personal meeting with the prime minister, he took the job.

Though the company’s finances and share price have improved since Jauhari took over in 2011, both his and the company's futures will likely be determined by what happens in the coming weeks.  

 

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