KL to build terminal for low-cost airlines
KL to build terminal for low-cost airlines
Associated Press, Kuala Lumpur
Malaysia will build a terminal exclusively for low-cost airlines
at the modern Kuala Lumpur International Airport, a minister said
on Wednesday, in a blow to no-frills carrier AirAsia which had
hoped to use an old airport closer to the city at a cheaper cost.
Transport Minister Chan Kong Choy told reporters that the 100
million ringgit (US$26 million) terminal will be ready by the
first half of 2006.
The government decision to keep all airlines -- regular and
low-cost -- at the current international airport is purportedly
aimed at making it a regional hub to counter competition from
neighbors Singapore and Thailand.
"This is a strategic measure to ensure that the Malaysian
aviation industry continues to achieve rapid growth and the
government's decision to develop as a regional hub is achieved,"
Chan said.
Singapore is adding a fourth terminal to its Changi airport
and is building another terminal for low-cost airlines, while
Thailand is building the new Suwarnabhumi airport outside Bangkok
to replace the current one at Don Muang.
AirAsia, Asia-Pacific's leading low-cost carrier that
revolutionized air travel in the region, had lobbied hard for a
dedicated terminal at Subang airport, about 25 kilometers from
old Kuala Lumpur.
Subang airport was Malaysia's main airport until it was
relocated to the Kuala Lumpur International Airport in Sepang,
about 70 kilometers from downtown Kuala Lumpur, in 1998.
AirAsia Group Chief Executive Tony Fernandes has said that his
airline will be able to cut fares by up to 15 percent if it
operates from Subang. He has said that airport costs can go down
30 percent in Subang because aircraft will save on fuel by
spending less time waiting to land and takeoff than at the
congested KLIA.
But AirAsia's rival, flag carrier Malaysia Airlines, believes
a Subang hub could hurt the KLIA revenues, and that would not be
in national interests.
Malaysia Airports Holdings, which runs KLIA, is expected to
build the dedicated terminal for no frills carriers. KLIA handled
more than 20 million passengers in 2004, up 15 percent from
2003's 17.4 million.