LAST_UPDATEFri, 22 Jun 2018 11pm

MAVCOM's Rejection Of Route Applications Hamper Malaysia's Tourism And Economic Growth: AirAsia

KUALA LUMPUR: Malaysian Aviation Commission’s (Mavcom) rejection of route applications will only further hamper Malaysia’s tourism and economic growth.

AirAsia Group, the operator of low-cost carrier in Asia Pacific, reiterated its stance that the responsibility for granting route approvals should be given back to the Transport Ministry (MOT).

The statement from the Group highlighted that MOT understands the importance and values the benefits of a fully liberalised aviation industry, and has consistently granted the necessary route approvals as long as bilateral rights are available.

AirAsia Malaysia chief executive officer Riad Asmat said Mavcom is not an airline, and should leave the business to actual airlines, like AirAsia, that understand the market.

"By failing to understand the true business of airlines, and by trying to micro-manage the industry, Mavcom is doing more harm than good to Malaysian aviation, the exact opposite of its mandate.

"It is holding the industry back with slow approvals and high charges while other countries invest heavily in increased air traffic connectivity, to the detriment of the Malaysian tourism sector and the economy," he said in a statement.

Yesterday, Mavcom defended its decisions to reject AirAsia’s application to add more flights on two routes.

The commission said it looks to facilitate orderly growth, competition and consumer choice over the long term, and the prevention of consumer inconvenience, in the allocation of air traffic rights (ATR).

AirAsia said Mavcom’s ATR allocation does not follow a process that takes into account of airlines’ views.

AirAsia said it has provided feedback at all its meetings called by the commission to discuss the proposal to revise the ATR allocation process, as well as in letters but most of its concerns were ignored and have not been addressed.

The company has shared its views with Mavcom that the operation of international routes which are unrestricted in bilateral air agreements should not be blocked.

Mavcom’s decision to reject route applications is therefore completely against the Open Skies policy advocated by the MOT when negotiating for bilateral air agreements with other countries, it added.

AirAsia’s application to increase Kota Kinabalu-Sandakan flights from 25 trips to 32 trips per week faced rejection from the Commission, citing overcapacity.

AirAsia’s flights on that route are already at 90 percent load factor.

“We also wish to seek clarification from Mavcom on why MASwings is being allowed to operate 21 trips per week on the route,” it added.

AirAsia said MASwings is a fully subsidised airline and possesses an undue financial advantage over other commercial airlines, and a review of its 21 times weekly service is required.

“Inter-Sabah air connectivity has been held back for years and we are keen to boost tourism in the state,” it added.

As for Kuala Lumpur-Haikou, AirAsia said it is irrelevant to state that AirAsia had previously operated and terminated the route in 2012 as market conditions have changed since then.

"Chinese nationals now enjoy an e-Visa facility for travel into Malaysia and Malaysia is one of the 59 countries that enjoy visa-free access to Hainan island, where Haikou is located.

"These factors mean additional capacity is needed on the route to cope with the projected increase in traffic between Kuala Lumpur and Haikou," it said.

AirAsia said Malaysian carriers already lag behind their Asean competitors in terms of total weekly seats deployed for points in Asia.

“Mavcom blocking growth in this manner only serves to benefit other regional airlines who are allowed to grow without undue restrictions by their own civil aviation authorities,” it said.

We have also seen a three percent decline in tourist arrivals to Malaysia to 25.95 million in 2017 from 26.76 million in 2016.