28023798-airline-industry-in-malaysia.docx

8/10/2019 28023798-airline-industry-in-malaysia.docx

1/3

The aviation sector has played an important role in developing the economy ofMalaysia. The sector has helped in stimulating other sectors of the economy liketourism, hospitality, and trade. In the last decade, the Malaysian aviation industry went

through a period of strong growth, with the passenger traffic at both domestic andinternational terminals recording high growth rates. Malaysia was the 18th-largest civilaviation market in the world in terms of air passenger traffic as of 2012. During the lastfive years, the passenger traffic growth in the country was higher than the average ratesfor East Asia, South Asia, and the world.

In Malaysia, airlines are separated into two; 1) Passenger airlines and 2) Cargo airlines. The

passenger airlines in Malaysia are Air Asia, Malaysia Airline System Berhad (MAS), Firefly

which is owned by MAS, Layang-Layang Aerospace which is based in Sabah to provide air

services to Layang-Layang Island, Berjaya Air which is owned by Berjaya Group, Sabah Air and

last but not least Hornbill Skyways which is a helicopter service that operates in the rural area of

Sarawak. Other than passenger airlines, there are also three cargo airlines that operate in

Malaysia. They are the Athena Air services, MAS cargo and Transmile Air Services. Despite the

various kinds of air operators, the airline industry in Malaysia is being monopolized by two main

operators.

The first one is the Malaysia Airline System Berhad (MAS), which is Malaysias full service

national carrier that first took the skies in 1947 under the name of Malayan Airways Limited. It

was formed through a joint initiative of the Ocean Steamship Company of Liverpool, Straits

Steamship of Singapore and also Imperial Airways. With a team of young and dynamic people,

the domestic carrier turned into an international airline in less than a decade and the name MAS

was only fully incorporated in 1973 after going through numerous mergers and separations. As

of today, MAS flew nearly 50 000 passengers daily to 100 destinations worldwide. The carrier is


2/3

a national identity to Malaysia and also a proud one as it had been awarded as the Worlds Best

Cabin Crew in 2001 until 2004 and 2009, and the 5 STAR Airline award from 2005 till 2009

by Skytrax UK. MAS currently have 90 aircrafts for domestic and international flight. There are

currently 20 Airbus and 70 Boeing. MAS main base is at Kuala Lumpur International Airport

(KLIA).

The other airline operator in Malaysia is Air Asia which takes on the low-cost budget airline

business model and is the leading budget airline in Asia. Air Asia has been expanding rapidly

since 2001 and flies to 61 destinations operating 400 flights daily using its 75 aircrafts that it has.

To date, it has flown over 55 million passengers across the region and continues to create more

extensive route network through its associate companies. In the second quarter of 2009, Air Asia

has a capacity growth of 22% (YoY) due to increased number of routes flight frequencies and

passenger growth of 24% (YoY) or 9 005 828 seats in total as at 11 August 2009 (Graph 1). This

is due to its low fare structure making Air Asia the number one choice as opposed to MAS. With

its vision to be the largest low cost budget airline in Asia and serving the 3 billion people who

are currently underserved with poor connectivity and high fares, Air Asia had also made the

nation proud. It was recently awarded the Best Low Cost Airline award by the Skytrax UK and

has started to serve long haul flights to the United Kingdom under its associate company Air

Asia X. Air Asia believes in serving the best to its customers with no frills, hassle-free and low

fare business concept and under its philosophy Now Everyone Can Fly. Air Asia has sparked a

revolution in the airline industry with more and more people around the world choosing Air Asia

as their preferred choice of transport giving greater competition to MAS in terms of monetary

value. Air Asia has more than 50 aircrafts for their flights. There are currently 45 Airbus and 9

Boeing. Air Asia main base is at Low Cost Carrier Terminal (LCCT) and Kuala Lumpur

International Airport (KLIA).

Despite the tough competition that the two airline operators of Malaysia persists, both MAS and

Air Asia managed to overcome the global economic downturn that the world economy is

currently experiencing and recorded RM180 million and RM203 million in net income for the

first half of 2009 which is better than the industrys market average (Graph 2).


3/3

Air Asia has been expanding rapidly since 2001 and flies to 61 destinations operating 400 flights

daily using its 75 aircrafts that it has. To date, it has flown over 55 million passengers across the

region and continues to create more extensive route network through its associate companies

It was recently awarded the Best Low Cost Airline award by the Skytrax UK and has started to

serve long haul flights to the United Kingdom under its associate company Air Asia X.

AirAsia Berhad(MYX:5099)is aMalaysianlow-cost airlineheadquarterednearKuala Lumpur,Malaysia,operating both domestic and internationalflights to 100 destinations crossing 22 countries. Its main hub isklia2at theKuala Lumpur International Airport(KLIA). Its subsidiary,AirAsia Xfocuses

on long-haul routes. AirAsia's registered office is inPetaling Jaya,Selangorwhile its head office is atKuala Lumpur International Airport.

The outlook for Malaysian aviation is positive and the development movement inpassenger traffic is projected to last in the coming years. The progress will be driven byan upsurge in domestic as well as in international tourism, the increasing popularity ofMalaysia as an Asian travel hub, the growing importance of Kuala Lumpur as aninternational financial center, and the surge in the per capita income.
http://en.wikipedia.org/wiki/Bursa_Malaysiahttp://en.wikipedia.org/wiki/Bursa_Malaysiahttp://en.wikipedia.org/wiki/Bursa_Malaysiahttp://www.bursamalaysia.com/market/listed-companies/list-of-companies/plc-profile.html?stock_code=5099http://www.bursamalaysia.com/market/listed-companies/list-of-companies/plc-profile.html?stock_code=5099http://www.bursamalaysia.com/market/listed-companies/list-of-companies/plc-profile.html?stock_code=5099http://en.wikipedia.org/wiki/Malaysiahttp://en.wikipedia.org/wiki/Malaysiahttp://en.wikipedia.org/wiki/Low-cost_carrierhttp://en.wikipedia.org/wiki/Low-cost_carrierhttp://en.wikipedia.org/wiki/Low-cost_carrierhttp://en.wikipedia.org/wiki/Kuala_Lumpurhttp://en.wikipedia.org/wiki/Kuala_Lumpurhttp://en.wikipedia.org/wiki/Kuala_Lumpurhttp://en.wikipedia.org/wiki/Malaysiahttp://en.wikipedia.org/wiki/Malaysiahttp://en.wikipedia.org/wiki/Malaysiahttp://en.wikipedia.org/wiki/Klia2http://en.wikipedia.org/wiki/Klia2http://en.wikipedia.org/wiki/Klia2http://en.wikipedia.org/wiki/Kuala_Lumpur_International_Airporthttp://en.wikipedia.org/wiki/Kuala_Lumpur_International_Airporthttp://en.wikipedia.org/wiki/AirAsia_Xhttp://en.wikipedia.org/wiki/AirAsia_Xhttp://en.wikipedia.org/wiki/AirAsia_Xhttp://en.wikipedia.org/wiki/Petaling_Jayahttp://en.wikipedia.org/wiki/Petaling_Jayahttp://en.wikipedia.org/wiki/Petaling_Jayahttp://en.wikipedia.org/wiki/Selangorhttp://en.wikipedia.org/wiki/Selangorhttp://en.wikipedia.org/wiki/Selangorhttp://en.wikipedia.org/wiki/Kuala_Lumpur_International_Airporthttp://en.wikipedia.org/wiki/Kuala_Lumpur_International_Airporthttp://en.wikipedia.org/wiki/Kuala_Lumpur_International_Airporthttp://en.wikipedia.org/wiki/Kuala_Lumpur_International_Airporthttp://en.wikipedia.org/wiki/Selangorhttp://en.wikipedia.org/wiki/Petaling_Jayahttp://en.wikipedia.org/wiki/AirAsia_Xhttp://en.wikipedia.org/wiki/Kuala_Lumpur_International_Airporthttp://en.wikipedia.org/wiki/Klia2http://en.wikipedia.org/wiki/Malaysiahttp://en.wikipedia.org/wiki/Kuala_Lumpurhttp://en.wikipedia.org/wiki/Low-cost_carrierhttp://en.wikipedia.org/wiki/Malaysiahttp://www.bursamalaysia.com/market/listed-companies/list-of-companies/plc-profile.html?stock_code=5099http://en.wikipedia.org/wiki/Bursa_Malaysia

Documents

28023798-airline-industry-in-malaysia.docx