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AirAsia, Borneo, Malaysia Airlines (MAS), Sabah, Sarawak, Sarawak Economy, Sarawak Tourism

AirAsia says it will benefit from Firefly’s withdrawal from Sarawak and Sabah

WELL, AirAsia has finally come out and said it.

The airline announced in Singapore at the OSK-DMG Asean Corporate Day 2012 this week that its yield and load factor would improve now that Firefly no longer serves Sarawak and Sabah.

Gee, really? And why is it that Firefly was forced to leave Sarawak and Sabah in the first place? Why could the airline no longer continue serving the people of East Malaysia despite having very high load factors for all its flights to Sarawak and Sabah?– yes they were full most of the time.

So basically Firefly was giving AirAsia a good run for its money. Firefly’s load factor was very high, so I am guessing AirAsia’s load factor was not as high.

So when the so-called rationalisation of the airline industry happened and Malaysia Airlines (MAS) and AirAsia agreed to their unholy alliance through a share swap, AirAsia decided it wasn’t going to allow upstart Firefly do better in the lucrative Kuala Lumpur – East Malaysia routes.

When Firefly was forced to withdraw, there were all sorts of public relations excuses going around, well now at least AirAsia has come right out and said it.

At least it is clear now who is the true beneficiary of this (ir)rationalisation exercise for our airline industry … (hint … it is not the passengers … MAS or Firefly …)

Well, I am just grateful that the governments of Sarawak and Sabah have had the wisdom to try to take some control of aviation policy by making MASwings a regional airline in which both state governments will have a major share in.

In the meantime, us East Malaysians will just have to accept the fact that we are at the mercy of the airlines from Malaya.

An article from The Sun:

AirAsia to benefit from Firefly’s withdrawal of jet services

PETALING JAYA (Jan 6, 2012): AirAsia Bhd said the withdrawal of Firefly’s jet servics to Sabah and Sarawak would improve the yield and load factor for the budget carrier.

At the OSK-DMG Asean Corporate Day 2012 in Singapore yesterday, the low-cost carrier added that 2012 growth will be contributed by the opening of new routes and increase in frequency on some of its more popular routes.

The carrier will also be taking delivery of 17 aircraft this year, of which three and four aircraft will be allocated for its new associates, Philippines AirAsia and AirAsia Japan, respectively.

“AirAsia Japan has the potential to tap into the sizeable and under-penetrated low-cost carrier market and expects to be profitable in the first year of operations. (That’s because it is) tapping into a high yield market where four of its potential domestic routes in Japan are already one of the top 10 busiest routes in the world,” said OSK in a note to clients.

AirAsia also said the proposed initial public offering (IPO) of its Indonesian and Thailand affiliates are on track for first quarter of this year.

“(AirAsia) management believes it is just a matter of timing given the current market conditions to extract the best value,” said OSK, maintaining a “buy” call on the stock, with a RM4.57 fair value.



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