According to The Edge, the company’s CEO Chandran Rama Muthy said the cuts would run through April 12, after which the airline would reassess the situation.
He said the reductions would focus on flight frequencies rather than destinations.
“For example, instead of operating three flights, we may reduce it to two. While frequencies on certain routes will be adjusted, the destinations we currently serve will remain unchanged,” he said.
“Flights between Kuala Lumpur and Penang, for example, will be reduced from five daily services to two, while KL-Kota Kinabalu services will be cut from three to two.
“Similar reductions have been made on longer-haul routes such as KL-Kathmandu and KL-Perth, where frequencies have been trimmed to limit fuel consumption.”
Chandran said higher fuel surcharges have been implemented, but are not enough to fully offset rising costs.
He also stressed that the reductions were temporary adjustments, adding the company could be “thinking everything is normal and then doing business as normal, and tomorrow we are not prepared”.
Chandran’s memo to staff, which went viral earlier this week, described the cuts as a precautionary move to conserve resources amid historic jet fuel prices.
The airline, which employs about 3,500 staff, is also offering voluntary unpaid leave for staff from April 6, with applications open until April 3.
“The aviation industry is currently facing significant headwinds due to escalating geopolitical tensions in the Middle East. These developments have led to extreme fuel price volatility and disrupted global supply chains,” Chandran said in the memo.
Global average jet fuel prices rose to US$197 per barrel last week, according to IATA (International Air Transport Association) data, a significant increase from US$95.5 a month prior.
As a result, many global airlines have implemented fuel surcharges. Other carriers in the region, like Vietnam Airlines and Cebu Pacific, have cancelled certain flights.
No hedging despite rising oil prices
Chandran said Batik Air Malaysia had no hedging contracts in place, citing risks seen in the industry when prices fall below contracted levels.
“We have seen airlines that have incurred a lot of loss due to hedging before. As such, we are very careful to go on that route,” he said.
Chandran said the airline remains financially sound but it is taking proactive steps to ensure long-term sustainability.
“One good thing is everyone in the ecosystem is discussing how we can walk through this together, because we cannot afford to forego one player or another,” he said.