By Chan Quan Min
Airlines should prioritise national interest before “petty competitive considerations,” acting transport minister Hishammuddin Hussein said today in a media address at klia2.
The acting transport minister said the government would formulate a National Aviation Policy, as first announced by prime minister Najib Abdul Razak in his Budget 2014 speech last October, to ensure a “win-win situation” for industry players.
“There is a limit for (airlines) to be competing with each other at the expense of national interest and the national agenda,” said Hishammuddin.
Last year saw a cutthroat fare war take place between Malaysia Airlines, AirAsia and new market entrant Malindo Airways. Competition was especially intense in domestic flights.
According to data compiled by Maybank Research, passenger traffic expanded approximately 17% from January to October in 2013 as airlines added a record number of new flights. Consequently, profit margins tightened and airlines as a whole severely underperformed the FBM KLCI on the stock exchange.
Hishammuddin Hussein
“The task of the Ministry is to provide the policy direction and guidance, and that is what we are going to do,” Hishammuddin explained.
Hishammuddin will call a meeting later this month to kick-off discussions on the National Aviation Policy.
“What we need to do is to get the stakeholders together,” the minister said. “One opportunity for the stakeholders not to look at their own individual interest.”
Hishammuddin confirmed all major Malaysian airlines have agreed, in principle, to meet. This would include the unprofitable national airline Malaysia Airlines, along with privately owned carriers AirAsia and Malindo Airways.
The airlines would be urged to “agree on basic values and targets” for the industry and to find common ground on national interest, said Hishammuddin.
‘There must be areas where (the airlines) can agree upon where it must be a win-win situation.”
During today’s press conference, Hishammuddin reiterated Malaysia’s commitments to global and regional aviation treaties, in particular, the Association of Southeast Asian (Asean) open skies agreement to come into effect in 2015.
Therefore, the ministry should “look realistically in wanting to restrict or open up anything,” he added.
klia2 on track for May 2 opening
Following a walkabout of the construction site this morning, Hishammuddin pronounced klia2, the new low-cost carrier terminal, as 98% complete.
Construction work at the terminal has been timed for completion on Jan 31, ahead of the terminal’s May 2 opening date, Hishammuddin said.
Between the completion of physical works and the opening date, Malaysia Airports Holdings Bhd (MAHB), the operator of klia2 will have a full three months to obtain Operational Readiness and Airport Transfer (ORAT) certification.
“The biggest test is the integration and coordination of operations,” said Hishammuddin.
The new low-cost carrier terminal has been delayed repeatedly, by as many as five instances, from its original September 2011 completion date.
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