In 2014, Malaysia Airlines experienced two tragedies in quick succession, damaging the company's reputation and finances, with negative implications for Malaysian tourism. This research assesses the impact of this. We find that the share price response was immediate and substantive. The carrier implemented sweeping adjustments, while passenger traffic rapidly declined particularly in Asian markets. Malaysian Airlines augmented fare reduction after each accident to stem the ongoing leakage of passengers. Traffic from China witnessed sharp declines, signalling the severity of the incumbents' prognosis. We further examine the investor response and the ultimate government decision to nationalise and restructure. • We investigate the financial effects of the Malaysia Airlines disasters. • Share price response to both tragedies was substantial compared to previous incidents. • The reverberating shocks changed long-standing correlations and information flows. • International passengers sought other options despite lower fares offerings. • The most prudent choice was Malaysian state intervention to protect tourism industry.
Corbet et al. (2020) studied this question.