Saturday, January 3, 2009

A closer look at the proposed KLIA East@Labu

THERE are some reservations over the proposed new terminal at KLIA East@Labu.

After all, there is already the KLIA and the LCCT.

But let’s look at the bigger picture.

The new terminal will allow AirAsia and AirAsia X to grow and strengthen Malaysia’s position as a global air transport hub.

It’s actually going to be an exciting project.

Let’s look at it with the full statistics.

Latest figures show that in 2008, KLIA attracted 27.4 million travellers, far lower than the 37.8 million at Changi Airport and the 41.7 million at Bangkok International Airport.

The present LCCT is overcrowded and was never intended to be a permanent terminal.

But with a strong terminal, Malaysia will unseat Singapore by 2013 with 55 million air travellers compared with slightly over 51 million in Singapore.

Thailand will still hold the top position with an estimated 57 million travellers going through Bangkok.

This scenario will only happen if a new low cost terminal is built.

The present LCCT is overcrowded and was never intended to be a permanent terminal.

Repeat – a temporary structure.

It was built as a cargo terminal.

Even recent plans to expand the LCCT to accommodate 15 million passengers a year will not help AirAsia much.

Indeed, its expansion will not be able to sustain AirAsia’s passenger volume within a year.

The airline’s growth estimates show that AirAsia will carry 12.3 million passengers in 2009; 15.7 million in 2010; 19.4 million in 2011 and 30 million by 2013.

The current LCCT also has a severe shortage of aircraft parking bays and this could impede the growth of AirAsia.

There are 33 bays for A320s and three bays for A330/A340.

By next year, there will be a shortfall of six bays for the airline that has ordered a fleet of new aircraft.

By 2010, the shortfall will grow to 16 bays.

Malaysia Airports Bhd has said that it will be able to build a new LCCT by 2014.

By this time, the shortfall of parking bays will be 41 and there will be a 12 million shortfall at the present LCCT.

Little wonder then that the Cabinet, Finance Ministry and Economic Planning Unit officials endorsed the plan to build KLIA East@Labu last week.

The reality is that the current LCCT has outlived its usefulness and with the Government facing the reality of a worldwide economic slowdown, funds are tight to build a new facility.

The plan put forward by Sime Darby Bhd and AirAsia involves private sector financing.

Sime Darby will set aside a sliver of the huge tract of plantation land it owns in Labu and its property arm will build KLIA East@Labu by 2011 at a cost of RM1.6bil, minus land cost.

The multinational will then sell the terminal to either AirAsia or a consortium led by AirAsia.

It’s not difficult to understand why Sime Darby is involved in the venture.

It wants the terminal and its ancillary facilities to become a catalyst for its Vision Valley development.

This Vision Valley master plan of housing, recreational, wellness and health facilities is aimed at meeting the needs of the Klang Valley population which is set to grow to 10 million by 2025.

Two of the main supporters of the KLIA East@Labu have been the Negri Sembilan and Malacca state governments.

Both these states know that they will benefit from the economic activity generated by the terminal while Malacca is likely to get a stronger inflow of tourists.

Sources said several other sites for the new LCCT at the present KLIA site were proposed but were found to be unsuitable.

The site at KLIA North was not suitable because the height of the ERL track makes it impossible to develop it there while the swamp soil condition at KLIA West is too costly and time consuming to develop.

How will KLIA and KLIA East@Labu be connected?

·A 7km branch road will be built to link KLIA East@Labu to KLIA and the North South Expressway.

·A 7km ERL link is proposed from KLIA to KLIA East.

·A bus hub will be built at KLIA East

·A 3km KTM Komuter railway line is being proposed from the railway station in Labu.

All the costs for building the airport, road and rail links will be privately financed.

Where is KLIA East@Labu?

About 8.6km from the KLIA main terminal building.

By road, the distance from KL’s Golden Triangle to KLIA East is 50km, compared with a distance of 78km to KLIA.

With the new terminal, flying low cost carriers will never be the same again. It can only get much better.

AirAsia X keeps hiring as London route seats snapped up

Malaysian budget carrier AirAsia X said it can weather the storm of a sharply deteriorating global economy and is hiring pilots to expand its routes to China, India, South Korea and Japan.

Chief Executive Azran Osman Rani said that while it was a challenging period for the aviation industry as many countries slip into a recession and carriers go bust, there were "a lot of business opportunities for us."

Bookings for its direct London flight on its leased Airbus 340-300, due to begin March 11, were overwhelming, he said, with 30,000 seats sold.

Demand was great as ticket prices cost about 2000 ringgit (A$838), less than half the price of a regular non-budget flight.

AirAsia X will fly five times a week between the Malaysian capital Kuala Lumpur and Stansted Airport on the outskirts of London.

Azran said AirAsia X was looking to expand its routes in 2009 into northern India including New Delhi, Amritsar and Mumbai, and to Beijing. In 2010 it aims to target South Korea and to Tokyo, Hokkaido in northern Japan and Kyushu in the south.

Azran said it was taking on new staff for its expansion. "We are still hiring pilots and cabin crew despite the tough economic outlook next year," he said.

AirAsia X, which currently flies to Australia's Gold Coast, Perth and Melbourne, and Hangzhou in China, will end the year with about 362 million ringgit in sales.

It aims to expand sales tenfold to one billion dollars by the end of 2010, despite the global slowdown.

Azran said the main challenge amid the uncertain global outlook was "to effectively scale up the scope of our business while keeping the lid on costs."

He said that oil prices, which have sunk sharply in recent months, were not expected to surge in the short and medium term.

The carrier currently has three A330-300 aircraft, one of which is leased. It has placed an order for 25 more by 2013, of which Airbus has delivered two.

Richard Branson's Virgin Group has taken a 20 per cent stake in the airline and the British billionaire has vowed to ensure that it turns a profit.

Airasia's New Call Centre To Be Ready By Feb 15

KUALA LUMPUR, Dec 30 -- AirAsia expects its world-class integrated call centre in Kuala Lumpur, currently under construction, to be up and ready for service by February 15 next year.

The centre will cater to all its operations in the country and will be capable of dealing with any crisis situation, the low cost carrier company said in a statement here Tuesday.

"As we are presently undergoing migration, our call centre is operating with limitations and thus you may find the lines to be heavily congested," said its group chief executive officer Datuk Seri Tony Fernandes.

The airline's present call centre receives an average total of 15,000 calls a day.

Amid the congestion, AirAsia is encouraging its customers to utilise its website at where they will be able to perform a host of tasks and transactions related to their flight bookings.

"We sincerely apologise for the frustration caused by our call centre congestion. I assure you that you will have a whole new experience with our new international call centre when it's up and running in six weeks," Fernandes said.