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Aviation chiefs hail opening of S'pore-KL route
Karamjit Kaur, Aviation Correspondent
Tue, Jan 22, 2008
The Straits Times

THE opening of the Singapore-Kuala Lumpur route to budget carriers will be good for Asia's low-cost carriers, which expect strong growth this year, even in the face of a global economic slowdown.

Meeting at the Suntec Convention Centre for the annual Asia Pacific Low Cost Airline Congress from Tuesday, aviation pundits and airline chiefs hailed the liberalisation of one of Asia's most protected markets. Come Feb 1, Tiger Airways, Jetstar Asia and AirAsia will start flying between Singapore and KL - a sector now dominated by Singapore Airlines (SIA) and Malaysia Airlines (MAS).

The low-cost carriers will start with four daily return flights, injecting about 5,000 more round-trip seats a week into the market, or a quarter of SIA and MAS' combined capacity.

In December, restrictions on their number of flights will be lifted; the same deadline has also been set for unlimited flights between the 10 Asean capital cities.

Mr Carmelo Arcilla, the executive director of the Philippine Civil Aeronautics Board said at one of the panel sessions at the congress, that while he backed the principle of freer skies, it was also important to have anti-competitive laws in place so bigger carriers do not take to unfair practices to dominate the market.

That said, other speakers and conference delegates agreed that there was no stopping the wave of liberalisation that has hit Asia.

The question now was whether a recession - which will cast a global pall if it hits the United States - will rain on the parade.

Tiger's chief executive officer Tony Davis said he was none too worried.

He told reporters on the sidelines of the conference that in an economic slump, if people 'are nervous about expenditure, if they are nervous about their job security. if they are nervous about economic conditions, they are more likely to go to a budget carrier'.

He noted that low-cost carriers which had a lower cost base tended to weather crises better than the legacy airlines

'So no, I am not as concerned,' he said of the looming crisis.

 

 
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