Job That Keeps Them on Their Toes
By Fauziah Ismail
MALAYSIA Airports managing director Datuk Seri Bashir Ahmad shares the company’s expansion plans and the challenges it faces with FAUZIAH ISMAIL.
Malaysia Airports manages and operates 39 airports in the country: five international, 16 domestic and 18 short take-off and landing ports (STOL ports). It also operates in Kazakhstan, India and Turkey.
In the last five years, the company has focused on improving service levels at all airports, especially at its flagship airport, the KL International Airport (KLIA). At the same time, it is working to improve its financial viability, being the first airport company in Asia to float its shares on the stock market.
* SERVICE LEVELS
“In the last five years, we have been focusing on improving service levels, especially at KLIA to match our first-class infrastructure. I’m pleased that KLIA is on par with the best airports in the world.
“We benchmarked ourselves against other airports through the ACI- ASQ survey. KLIA was thrice voted as the Best Airport (15-25 million passengers per annum) in the 2005 AETRA awards, 2006 ACI-ASQ awards and 2007 ACI-ASQ awards.
“The surveys are conducted by the Airports Council International and are one of the most comprehensive surveys of an airport. They cover all facets that passengers come in contact with at the airport. They measure 34 service elements, each in greater detail of each other.
“We will continue to focus on service delivery, not only for passengers but also the airlines which are our biggest partners.
“We hope to extend gradually the benchmark achieved at KLIA to the other international airports in the country as well as domestic airports and the foreign ones we manage.
* FOREIGN VENTURES
“Taking advantage of the trend towards privatisation of airports worldwide, we have ventured overseas and are now involved in managing two in India and one each in Turkey and Kazakhstan.
The Astana International Airport in Kazakhstan was recently voted `Best Airport in Commonwealth Independent States 2007′ for passenger category of more than one million per year by the Airport of Civil Aviation Association based in Moscow.
“We are taking our expertise and exporting it overseas. By doing so, we are bringing along other companies to explore opportunities at the foreign airports we manage. For example, the car park and lounge services at Hyderabad airport are managed by Asian companies and Malaysia Airlines has signed a memorandum of understanding for a maintenance, repair and overhaul facility there.
“We will continue to look at opportunities overseas.”
* PROFITABILITY
“While we focus on service delivery, we also recognise the importance of being financially viable.
“We have been profitable year on year for the last five years. Our business plan takes into account the current financial restructuring exercise. One of our compelling achievements is the fact that we offer a high service level while imposing low charges on foreign airlines.
“Our landing and aircraft parking charges have remained the same for the last 26 years, which make us among the lowest in the world. Airlines based in Malaysia and operating in our airports are the beneficiaries.
“Notwithstanding this, in an effort to encourage new foreign carriers and promoting tourism, we introduced a new incentive scheme whereby we have waived landing and parking charges for new foreign carriers and existing ones that increased their frequencies. They also get free marketing support.
“But like all other industries, operating costs are rising and we do need to cover them.
“As our charges are regulated, it would depend on the government. We have voiced our views on the need to increase charges to the government.
“Nevertheless, over the last five years, we have put in efforts to increase our non-aeronautical revenue. In fact, we had cross- subsidised our aeronautical costs with revenue from commercial activities at the airport.
“We will continue seeking ways to increase these non- aeronautical revenues. In the next five years, we expect our non- aeronautical revenue to contribute 70 per cent to our coffers compared with some 50 per cent now.
“One way is to enhance our retail presentation. We are working closely with retailers who have proven to be among the best in the world to leverage on their expertise and knowledge to boost our commercial activities.”
* LOW-COST AIRLINES
“Over the last five years, the single biggest challenge to the airline industry is coping with operating costs.
“We saw, for example, the advent of low-cost airlines. We have embraced these changes as they are inevitable. Therefore we need to adapt our business to meet these ever changing requirements of the industry. “Low-cost travel is here to stay. Plans are in place to accommodate low-fare travel at all airports, including expansion of the low-cost terminal at KLIA. The low-cost airline business itself is changing, moving towards hubbing and transfer of passenger from point to point.
* KLIA
“KLIA celebrates its 10th anniversary this year. It first opened at the height of the economic crisis.
“It faced many challenges, including the SARS crisis but it continued to grow.
“When we first opened, many sceptics doubted if we had enough traffic. Ten years on, however, we are looking into the possibility of building a second satellite building, expanding the LCCT as well as building another at KLIA.
“Surveys have shown that an airport is no longer just a place to catch a flight but also where people can shop, eat and be entertained. It must be a destination itself. This is what the vision is for KLIA.”
* ISSUES & CHALLENGES
“We have our share of problems. These relate to activities at the airport such as the long taxi queues and touting.
“Efforts are being taken to overcome this with the support of relevant enforcement agencies.
“We have to continue to provide a high level of service as passengers’ expectations are increasing. We have to take into consideration what they expect of an airport.”
(c) 2008 New Straits Times. Provided by ProQuest LLC. All rights Reserved.