AirAsia to step up flights within Sabah and Sarawak to grow domestic operations

April 22, 2018 | By | Reply More

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SEPANG: Low-cost carrier AirAsia Bhd sees room for expanding its domestic operations, which contribute about 40% to its revenue currently, with intercity flights within Sabah and Sarawak.

The airline’s CEO Riad Asmat (pix), who recently took over the reins of the Malaysian unit, told SunBiz in an exclusive interview that the airline has a strong foothold in Sabah and Sarawak, but there are areas where it could “still serve”.

He said its domestic market share ranges between 50% and 60% depending on the state it operates in.

According to international aviation research entity Centre of Asia Pacific Aviation (CAPA), AirAsia’s share in the domestic market has significantly increased “over the past six months, benefiting from capacity reductions by both of its competitors at Kuala Lumpur International Airport (KLIA)”.

“AirAsia’s share of the domestic traffic at KLIA is now 66%, compared to 55% a year ago. KLIA accounts for 65% of total domestic traffic in Malaysia, which increased by 4% in 2017, to 25 million,” CAPA said.

Domestic flights account for 31% of the flight breakdown based on the number of routes and international 69%. AirAsia Malaysia’s total number of routes stands at 114.

“So we are working with authorities and state governments to see how we can get more rights to fly internally within the state … that is work in progress,” Riad, who marked his 100th day in office last week, said.

“We have also committed ourselves to aircraft that we are likely to put into Sabah and Sarawak and that is to increase our frequency, again because the current ones will serve a certain expectation … what we have learnt and what we have studied now is that there are still a lot more passengers who want our services,” he explained.

AirAsia, which has hubs in state capitals Kuching and Kota Kinabalu, its busiest routes, will look into timings, putting in the right aircraft and rescheduling flights once it obtains approvals for the routes, which Riad declined to reveal.

According to the Malaysian Aviation Commission, airports which can accommodate passenger jets in Sabah are Kota Kinabalu International Airport, Sandakan Airport, Tawau Airport and Labuan Airport while in Sarawak, it is the likes of Kuching International Airport, Sibu Airport, Bintulu Airport and Miri Airport.

Statistics provided by the commission showed Kota Kinabalu-Tawau as the busiest transcity route in Sabah while Kuching-Miri was the busiest for Sarawak. The least busiest are Kota Kinabalu–Lahad Datu and Miri–Sibu respectively.

Malaysia Airports Holdings Bhd noted that passenger traffic from Kota Kinabalu to Tawau rose to 630,864 in 2017 from 586,570 in 2016, while Tawau to Kota Kinabalu rose to 630,949 from 586,567.

As for Sarawak, Miri to Kuching increased to 546,235 from 543,295, and Kuching to Miri to 549,646 from 546,351.

The route with the highest increase in passenger traffic is Bintulu-Kuching which saw a passenger traffic growth of 50,859, to 343,081 from 292,222.

The airline has also been strategising its asset and resources utilisation, by releasing capacity from certain segments and increasing flights to routes with good pickup in terms of load factor and better earnings potential.
Terengganu is one of the routes to have seen an increase in flights, to 24 weekly flights from 21 previously.

On whether there are any untapped markets, Riad said the group is constantly on the lookout for new destinations.

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