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Fernandes wants aviation sector opened to competition

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Wednesday October 24, 2007

The Star

 

Fernandes wants aviation sector opened to competition

 

Stop the protectionism , he says

By B. K. SIDHU

 

PETALING JAYA: Protectionism has not helped any sector and it should be done away with in the aviation sector, especially for the Kuala Lumpur-Singapore route, AirAsia Bhd group chief executive officer Datuk Tony Fernandes said.

 

An analyst who did not want to be named concurred, saying that it was about time that the sector was opened to competition instead of being monopolised by two airlines – Malaysia Airlines (MAS) and Singapore Airlines (SIA).

 

“I think national interest has to come first so let’s end this protection. The contribution to the economy from the opening of the sector would be enormous,” Fernandes said in response to a report citing the Singapore Transport Ministry as saying that it was keen to see “further liberalisation” of the Air Services Agreement with Malaysia.

 

The report also said apart from the Singapore-KL route, the Singapore government was keen to expand the sky pact to other major cities in Malaysia.

 

This latest statement appears to indicate a change of heart, as it was only last month that Singapore issued an order to exclude the Air Shuttle Service Operation Agreement between MAS and SIA on the KL-Singapore air sector from Section 34 of the Competition Act.

 

Under the Act, business agreements that prevent, restrict or distort competition are not allowed.

 

“I am pleased with the latest statement. We think that closes one more potential roadblock for budget carriers to fly the KL-Singapore route,” Fernandes said.

 

“The people want it, the budget airlines want it and Singapore also wants it (opening of the KL-Singapore air sector to competition sooner than the Jan 1, 2009 timeline). The only party that does not want it is MAS.

 

“Consumers have had enough of this (duopoly). We are not asking for the open skies timeline of Jan 1, 2009 to be brought forward but are merely asking that we be given rights to ply the KL-Singapore route twice daily.”

 

A return flight to Singapore from KLIA costs about RM800 (including taxes and surcharges) but with competition, fares could drop to as low as RM9.90 one way, excluding taxes.

 

Fernandes said since protectionism had not helped the consumer, AirAsia, which had won accolades as the biggest low-cost carrier in the region, should not be stopped from operating the service.

 

Meanwhile, MAS managing director Datuk Idris Jala in an email response said: “We are all for open competition. All we are asking is that this is done fairly within the agreed timetable. By maintaining the roadmap's original timeframe of Jan 1, 2009 agreed upon by all Asean member countries, the airlines will be given enough time to prepare for an open skies environment.

 

“Otherwise, it will be akin to asking us to compete in the Olympics Games without sufficient preparation just because the other competitors are now ready. We want to compete in the Olympics but at the date previously agreed on because as the national carrier, we want to fly the Malaysian flag high.”

 

Fernandes said the budget airline “never slowed (despite all the hurdles) and while we welcome more airlines and competition, MAS has continued to operate in a monopolistic and old-fashioned way. MAS’ latest attempt to hide behind the International Air Transport Association (IATA) is ridiculous,” Fernandes claimed.

 

Recently, IATA chief executive officer Giovanni Bisignani threatened that the grouping of more than 250 airlines globally could take Malaysia Airports Holdings Bhd (MAHB) to court if Malaysia’s move to lower airport departure taxes at its low cost carrier terminals (LCCT) was not resolved.

 

“How could IATA complain to us? Why doesn’t Bisignani complain about Singapore’s taxes, why just LCCT? Why should IATA be involved in our issues?” Fernandes said.

 

The analyst also claimed that Bisignani had no right to ask consumers to pay more airport taxes since LCCT was a low-cost terminal that had only basic amenities.

 

On June 1, Malaysia reduced airport tax at the LCCTs in Kuala Lumpur and Kota Kinabalu to RM25 from RM51.

 

“We welcome IATA’s member airlines to operate at the LCCT if they want to save money but do not insult our sovereignty,” Fernandes added.

 

http://biz.thestar.com.my/news/story.asp?f...mp;sec=business

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Meanwhile, MAS managing director Datuk Idris Jala in an email response said: “We are all for open competition. All we are asking is that this is done fairly within the agreed timetable. By maintaining the roadmap's original timeframe of Jan 1, 2009 agreed upon by all Asean member countries, the airlines will be given enough time to prepare for an open skies environment.

 

“Otherwise, it will be akin to asking us to compete in the Olympics Games without sufficient preparation just because the other competitors are now ready. We want to compete in the Olympics but at the date previously agreed on because as the national carrier, we want to fly the Malaysian flag high.”

 

What kind of logic is IJ using? :angry:

 

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Fernandes; "He wants aviation sector opened to competition"

 

I agree with Mr Tony, we want 'THE CLEAN COMPETITION'

don't use any 'cable' like 4'th floor boy....

 

 

previously he lobby from the gov to takeover the RAS,

after u get the RAS, u handle ala cincai....

Remember AK has do 'excellent jobs' in Sabah & Sarawak (RAS)

 

please laaa don't repeat same mistake!!!

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A return flight to Singapore from KLIA costs about RM800 (including taxes and surcharges) but with competition, fares could drop to as low as RM9.90 one way, excluding taxes.

 

http://biz.thestar.com.my/news/story.asp?f...mp;sec=business

 

Comparing a full fare with taxes to a one in a thousand fare without taxes included

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Comparing a full fare with taxes to a one in a thousand fare without taxes included

 

Not to mention RM9.90 is only one-way compared with return fare...

 

But to be fair even with taxes included AK's fares would probably still be much lower than MH or SQ's

 

What kind of logic is IJ using? :angry:

 

Maybe Idris forgot that the 'competitor' in this 'Olympic games' of his actually came to the game later... MUCH later than MAS did :pardon:

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MAS should be 35 years old by now, 60 years if it wants to think that it started with Malayan Airways. Emm....even the cheif is spinning nowadays.

 

 

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I would have thought that a man of Datuk IJ's experience, calibre and exposure to the corporate culture, the notion of "fairness" in the real business world is utter myth. Reality is, there is no room for such sentiments - not if you yourself intend to survive for long term that is !

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I would have thought that a man of Datuk IJ's experience, calibre and exposure to the corporate culture, the notion of "fairness" in the real business world is utter myth. Reality is, there is no room for such sentiments - not if you yourself intend to survive for long term that is !

 

Plain and simple...not EVERYBODY without past aviation experience can run and airline to success....

 

IJ shouldve stuck to oil...

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.....as the national carrier, we want to fly the Malaysian flag high

Quite laughable, if one takes into consideration the numerous punitive "cost cutting" measures of recent days, so well documented and deliberated here on other threads.

Sadly, MH does not seem too keen on "flying the Malaysian flag high" at the moment, more like dragging it through mud.

Please do some homework and do battle in your own market segment - this on going war of words with AK is turning MH into a LCC with 5 star cost structure, sooner than the most optimistic of us can imagine I fear

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from The Star

Airaisia gets the nod for flights to Singapore

 

By WONG SAI WAN

 

PETALING JAYA: Now everyone can fly cheap to Singapore. AirAsia got the nod from the Government yesterday to operate two flights daily to the republic.

 

It is learnt that the Cabinet gave the nod at its weekly meeting. This decision comes a few days after Singapore's Transport Ministry said that it was keen to see further liberalisation of the air services agreement with Malaysia.

 

According to sources, Tiger Airways, Singapore’s own budget airline, would also be offered to fly the same route.

 

“This means that travellers will have a choice of not only one low-cost carrier to Singapore but two. This will surely spark a price war,” an aviation analyst commented.

 

On average, MAS flies seven shuttle flights a day to Singapore while SIA does it six times daily.

 

For the shuttle service, which is jointly operated by the two airlines, the price of a one-way ticket is RM167 while an economy non-shuttle one is RM266. Airport tax and surcharges cost RM140.

 

AirAsia and Tiger Airways are expected to charge about 30% of the non-shuttle fare but will have the usual cheap offers for limited seats. The two low-cost carriers will operate the route between the LCCT at KLIA and the Budget Terminal at Changi Airport.

 

It was learnt that AirAsia and Tiger Airways would only be allowed to operate the two flights each on off-peak hours. Sources expected the two carriers to start operations in January.

 

The analyst said the decision would be a big boost to the two airlines as Singapore and Malaysia were two popular international hubs aimed at different markets.

 

“The cheaper 40-minute flight between KLIA and Changi airports will mean more international passengers stopping in Singapore or Kuala Lumpur to make the extra hop to either place.

 

“AirAsia will benefit more than Tiger Airways because of the regional connections it already has. Couple that with the coming of AirAsia X, they will be able to even pull long-haul passengers from Singapore,” he added.

 

AirAsia chief executive officer Datuk Tony Fernandes could not be contacted for comment. AirAsia officials said he had flown to Singapore.

 

Fernandes had been vocal about the reluctance of the two governments to allow budget airlines to operate between the two countries ahead of the Asean open skies agreement, which will come into force in 2009.

 

Finally... AirAsia and Tiger Airways will join in the shuttle run... not sure about Jetstar though?

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Non-shuttle means you can make prior reservation, assured of a seat on your chosen flight.

Shuttle fare means you turn up at the airport and see if the next flight can accomodate you. If full, wait for next available flight (with vacant seat)

 

That is how I understand it anyway !

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I remember a long time ago, you can buy 'standby' tickets like that for ANY destination (cheap cheap). And you have to be there to see if there's any vacancies or no shows.....and you only know 10 minutes before takeoff if you get it.

 

Wonder if we can still purchase such tickets now....

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I remember a long time ago, you can buy 'standby' tickets like that for ANY destination (cheap cheap). And you have to be there to see if there's any vacancies or no shows.....and you only know 10 minutes before takeoff if you get it.

...

 

Hehehe ... and at SIN, you wait and wait for a seat, but not to worry, in the late afternoon SQ would use a huge 747 to mop up all the leftovers. :D

 

+++

 

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how about PEN-SIN ? Any news ?

 

http://investing.reuters.co.uk/news/articl...IA-UPDATE-1.XML

 

KUALA LUMPUR, Oct 24 (Reuters) - Malaysia's cabinet has given approval in principle to allow budget airline AirAsia Bhd (AIRA.KL: Quote, Profile , Research) to start flights to neighbouring Singapore...

 

In additional to Kuala Lumpur, the twice-daily flights would link Singapore to the Malaysian cities of Penang, Kota Kinabalu and Kuching, the source said.

Edited by Keith T

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Fernandes; "He wants aviation sector opened to competition"

 

I agree with Mr Tony, we want 'THE CLEAN COMPETITION'

don't use any 'cable' like 4'th floor boy....

previously he lobby from the gov to takeover the RAS,

after u get the RAS, u handle ala cincai....

Remember AK has do 'excellent jobs' in Sabah & Sarawak (RAS)

 

please laaa don't repeat same mistake!!!

 

agreed with you man....want LCCT, build LCCT...other airline got to used subang...so he want subang...so now also want the cash cow route..........4'th floor boy say boleh......next what boleh...let's guesss?

 

RAS issue....run ala cincai..but got compensation....with that can used for A330 downpayment....bagus...malaysia boleh.

 

Hidup Myteam....free holiday visit to manchester

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Hehehe ... and at SIN, you wait and wait for a seat, but not to worry, in the late afternoon SQ would use a huge 747 to mop up all the leftovers.

 

Do they still send their 747s to SIN nowdays?

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I remember a long time ago, you can buy 'standby' tickets like that for ANY destination (cheap cheap). And you have to be there to see if there's any vacancies or no shows.....and you only know 10 minutes before takeoff if you get it.

 

Wonder if we can still purchase such tickets now....

 

I remember 'Student Standby' with 50% discount on Y in the 1980s. But fares were cheap then, and standby was because flight was full. In my case, many of my schoolmates at KBR were from KL, and when school breaks for the holidays, some will take a flight home. Since a few of them are children of MAS' board of directors, overseas station managers and MAS pilots, first class tickets are often snapped up quickly. My schoolmate whose dad is a MAS 742 captain, got to sit in the jumpseat of B732 KBR-KUL on one occasion when aircraft was packed.

Edited by Rozhan

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i hear FY have green light to fly to SIN from SZB the end of 2008..... (refer the statement "Gov approve 3 more hubs fo FY")

not good if there use F50 or ATR, but Subang is the best location in KL.... (golden triangle)

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i hear FY have green light to fly to SIN from SZB the end of 2008..... (refer the statement "Gov approve 3 more hubs fo FY")

not good if there use F50 or ATR, but Subang is the best location in KL.... (golden triangle)

 

later FY caused the traffic of SIN slow. :rofl: :help: :pardon:

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And yet again I am so disappointed with the Government for that...

 

It seems to me that now AK KUL-JHB now as good as gone, Now that AK have KUL-SIN twice daily.

Why would anyone fly to JHB if they can land at SIN, right? except of cause MH!

 

so where have all the inspiration to build JHB as WPI aviation hub?

 

 

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