The shifting demographics of the Maldives tourism industry presents new challenges – and a great many opportunities – for the country to grow as a destination, says CEO of new Maldivian flag carrier Mega Maldives, George Weinmann, during a ceremony in Male’ this week to mark the airline’s launch of direct flights to Shanghai and Beijing.
Since its maiden flight between Gan and Hong Kong early this year, Mega has focused on the country’s booming Chinese market. Chinese visitors last year showed the highest number of arrivals over more established markets, and were widely credited with insulating the Maldives from the effects of the economic recession afflicting the UK and Europe.
Weinmann emphasises that “while the Chinese market is now the number one market for the Maldives, is still not a mature market.”
“The agents in China don’t know the Maldives as well as the European agents who have been coming here for 30 years,” he explains. “The new agents are often asking us for help finding hotel rooms, and negotiate with the hotels – it’s not really our job, we’re an airline and there’s plenty of travel agencies on both sides – but oftentimes they aren’t connected. There have been incidents in the past where certain agents get very excited and think they can just fly their guests here, only to find there are no hotel rooms for their guests.”
Without intending to become a travel agency, the airline had found itself becoming an intermediary between the Chinese tour operators and resorts, he says, many of which are still getting to grips with the unique demands of the new market.
“We talk to resorts that are suffering with occupancy, perhaps 30-40 percent,” says Mega’s Marketing Director Ali Faiz, “and see how we can help each other. We also meet with resorts that are popular with the Chinese market and offer our jet to help them sell the Maldives.”
Whereas European guests tend to stay up to two weeks at resorts, the current trip pattern for Chinese visitors is very short – “four nights, five days,” says Weinmann.
“They are much more activity focused – a little less sun and sea, a little more doing things on a boat,” he says. “Like every other market they are very food conscious – but the type of food they are looking for is different, which for instance affects how we cater for inflight meals – although everyone likes ice-cream,” he adds.
Moreover, “as someone who has lived in China for seven years – they are huge spenders. The Chinese love to buy things. One complaint they may have with the Maldives is that there is not enough stuff to buy – they come here often with large wads of money and then go home with it. That’s an opportunity for local businessmen.”
The market is also rather risk adverse, which the fledgling airline found to its detriment in May when Hong Kong authorities issued a travel warning for the Maldives, triggered by excitable global media coverage of opposition-led protests in Male’.
“That was a near tragedy for us. We almost didn’t survive that period,” Weinmann acknowledges. “It came at the same time as changes on our side with pricing, and we almost lost the entire month of May because people who had been intending to go to the Maldives but hadn’t yet bought their tickets decided not to go.
“There was very low additional sales in May. Those people who had already bought their tickets – who had spent hundreds of dollars on rooms – couldn’t get that money back so they came anyway, and of course there were no problems. But when a warning like that goes out, anybody who has the discretion to choose not to buy, to choose somewhere else or postpone their trip, will do so. It doesn’t matter if it’s a yellow, red or black warning – it’s a huge hit. Just ask people in Thailand about what they experienced during their local turmoil. It is a roller-coaster ride in terms of bookings.”
Mega worked with resorts and the government to try and reassure visitors that the protests were limited to a few streets of the capital city – which few visitors to the country even set foot on.
“Recovery takes time,” Weinmann says. “When the incidents are over, then you have to go out and educate the market and tell all the travel agents what is going on. For a market like China that is growing as fast as it is, they do have other choices, and they are not as comfortable with the Maldives as the European market, which sees such incidents as a small bump in road.”
“We did obviously recover,” he adds, “because we launched Beijing-Shanghai a couple of months later, and that’s been very successful.”
Mega subsequently decided to introduce free cancellation insurance for every ticket, covering the first night of accommodation in the event of a delayed flight, which Weinmann explains was a way of offsetting the non-negotiable cancellation policies of many resorts in the Maldives.
“It’s one of the biggest issues in the Asian market right now,” he said. “We are competing against other Asian markets such as Bali and Thailand, and other island destinations such as Guam that are developing very fast, and in many of these countries hotels don’t have the kind of cancellation policies that exist in the Maldives. It makes it more risky for tour operators to sell the Maldives – we’re trying to eliminate that risk.”
Weinmann believes the Maldives also has room to grow existing markets, and said Mega hoped to launch flights to so-called ‘tier 2’ cities and stimulate growth in places such as Eastern Europe.
Korea also has more potential, he explained, noting that Mega would introduce a flight to Seoul in September.
“There are current five wide-body aircraft flying between Korea and Hawaii every day. That’s a nine hour flight, and the Maldives is probably a little cheaper.”
India, on the Maldives’ doorstep, was exactly two years behind China he predicts.
“But it’s a challenge that regulations prevent a Maldivian carrier flying more than 200 seats to Mumbai or Delhi. We have 250 seats, and we’d like to change that.”
Cargo imports are another growth opportunity, Weinmann says, announcing 15 discounted tickets to kickstart a trade delegation of Maldivian traders and businessmen to find opportunities in China.
“Right now all the cargo coming into the Maldives goes through Sri Lanka, Singapore or Dubai,” he explains. “Not much is produced in these locations, it’s all coming from somewhere else – a lot of it from China. We want to increase direct imports from China which should mean less cost and cheaper prices, as there will be less middlemen involved.”
Meanwhile, the airline has begun recruiting more Maldivian cabin crew, in addition to the two classes already through, and is currently training six Maldivian pilots and soon, engineering cadets. Weinmann predicts the company will employ over 100 Maldivian staff by the end of the year.
“We not doing this just because we want to, but because it’s the right thing for the airline. We think Maldives aviation can grow a lot further,” he says.
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As luxury destination Maldives have unique Island with superb reef and beaches. Unfortunately Chinese tourist will have negative effects on our tourism industry. The Chinese guest will eat up the crabs and damage our reefs.
boom boom airline
Congratulations Mariya and family.
The route and business opportunity might have benefited the Maldivian people more if the government had let it fall into the hands of Island Aviation Services.
However, we all understand that the point was not to benefit the Maldivian public or enrich state coffers but simply secure riches for close friend and partner in crime, Mariya Ahmed Didi, so that she might finance party activities and have her own loyal corp of yes-men and fawning idiots.
wat r v supposed to celebrate?
Tsk tsk is right. The whole world must know that President Nasheed's good friend and party ex-chairperson got this deal that should have come to the Maldivian government.
This is corruption. In broad daylight. A few Maldivians got some jobs, that cannot even compare to the employment that IAS offers to the average person and also the fact that IAS, if managed well, will provide much needed funds to the state.
Alhe mithiba ehchehin ge goi kuda kamakaa amihla edhun bodu kan.
@ tsk tsk and @wat??
Initially MEGA Investments approached invest maldives which was headed by Mifzal (Mariya's brother). He DID offer island aviation the chance to merge with MEGA. However Mr. MTTC BANDHU SALEEM and Mr. Haris of IAS called MEGA a flop and discreditted the whole operation. just like Air Maldives discreditted the approach from Emirates.
Mifzal seeing the opportunity resigned from Invest Maldives and brought the MEGA Project to the Maldives as his own. Making him the MD of MEGA MALDIVES.
This is the truth behind the whole operation and F*** IAS if you think they can run it.... they CANNOT, i KNOW it better than YOU and any one else
Who is more corrupt, Anni or Maumoon?
Truely interesting..story of 30 years can repeat if we have people like Mifzal and his likes who have more personal interest than national interest!
How sad, Bandhu Saleem is still the MD of IAS and he continues his corruption and his ill knowledge of running an airline which is doomed!! While air taxi, mega, etc is booming!!
All this is linked to the same princple that Gayoom did in the past: not been able to take tough decision of sacking inefficient and corrupt individual.
Look at Sarangu Adam Manku today..when he is a nusiance and so inefficient he is offered Special Envoy post with City Council post! History repeats!! Lets wait and see..
@Bandhu Saleem:
Thank you for reading my comment. Now please re-read it.
I emphasized the fact IAS should be managed properly, and please believe me, a heavy-handed executive who replaced the board of MACL in order to get what they wanted would not have had to endure resistance from IAS for a second if they really wished for the State aviation company to go through with it.
What nonsense! Claiming that you would know better than anyone else does not hold any water when your argument bears no logic whatsoever. Take these facts into account before defending "MEGA".
- IAS is a state enterprise and it is not young Saleem's family business for the State to cower in fear when he resists a proposition from Invest Maldives, which apparently was created for the sole purpose of securing investment for the GoM. The State has the power to influence IAS (like it has influenced BML, MACL, MTCC etc. etc.) if it believes that a project would truly be lucrative.
- There is a snowball's chance in hell that anyone would believe that Mariya Megatron Didi just stumbled upon riches through hard work and dedication.
- Mega Maldives projects job opportunities amounting to a total of 100 in the near future for locals. That is nowhere near the potential that IAS holds. Whatever argument based on the personalities of individuals in management positions notwithstanding.
- Call it corruption, embezzlement, opportunism, abuse of office, callous disregard for the nation, insider trading - the damage is already done. Defending Mariya's actions is pointless.
@ Bandhu Saleem
If only you would know how right you are with your comments on Bandhu Saleem. It's a shame that he and Haris still run the show, it's costing the Maldivian people dearly. Unfortunately most of them just don't know about it.
Now that ground handling isn't handled by IAS, i would imagine the company would be under a lot of financial stress, they should look look for a deal in merger with a larger international airline.
What's all the fuss, "tsk tsk"? I don't really care whether Mariya's brother and her family benefitted from the Mega deal. What really matters is that there is a privately owned aviation enterprise in the country albeit at a very early stage of development.
IAS is a state enterprise and state enterprises are not exactly known for their glorious successes, not just in this country, but throughout the world.
Quite obviously, there was a gap in the market; why didn't IAS jump at that? It's not something that just happened overnight.
I wish the Mega venture every success. They are not only providing employment opportunities to locals; they are also bringing in Chinese tourists who otherwise would not have been able to get here. Well done.
@tsk tsk
Touché....!!!
But still MEGA will run better as a private airline rather than a state run 'subsidiary'.
Call it corruption, or all those names you called it, how it is now is best suited for our country. Whether they know it or did it for those reasons is yet another argument
Thats really cool ..It really needs to spend on it's maintenance than trying to expand, though. Specially with critical equipment. better not fall off the sky 🙂
To add to what tsk tsk has mentioned, Mifzal's dad Ahmed Latheef is the Maldives Ambassador to China. It is said that this deal came through a Chinese company. Did Mifzal's dad send it to Invest Maldives so his son could get it? It is said Mifzal's dad is also a shareholder of Mega Maldives. Also Bandhu Saleem in charge of Island Aviation is the old Bandhu, right? The young Bandhu Saleem, who is married to a relative of First Lady Laila Ali, is in charge of MTDC and now also Maldives Airports Company. Its so confusing because there are two bandhu Saleem's kekeke.. But anyway the younger Bandhu Saleem took a lot of money from Bandos Island Resort when he was a manager there so Mr Deen kicked him out.. This guy has a history of corruption but the corruption-free Anni put him in charge of several state-run companies. The older Bandhu Saleem, who rides a bicycle, is a shareholder of Cyprea and was also running MTCC for a while.. Damn.. two Bandhu Saleems in charge of state-run companies.. thats confusing enough
True, Addu citizen, we should celebrate the growth of the private sector.
How it was done was my issue.
However, I still maintain that state enterprise is not such a bad thing when the state is strapped for cash. Lord knows a large part of state income comes from Dhiraagu, MWSC, MACL, STO etc. So reforming IAS would have served our interests better rather than creating the various ULs and WCLs and lord knows whats.
The fact of the matter is, that Mega Maldives is an affront to due process and a step back in working to minimize corruption.
I did not vote for a change because I wanted to change the persons receiving cutbacks and corrupt backroom deals. I wanted to see a Maldives where something could be done to minimize those deals (not outsize them to an international scale).
Also, I and a large number of my associates wanted a change whereby state enterprises could be strengthened and reformed before being gradually eased into public ownership.
State enterprise is one of the early drivers of growth in America (regardless of recent hiccups due to risky financial instruments), the UK, Singapore, China etc.
If this airline was run by a DRP supporter everything would sound more sophisticated. We welcome anyone who is making Maldives a better place to visit.