Singapore-based budget carriers hope to fly Malaysian routes

Singapore-based budget carriers hope to fly Malaysian routes

Agence France-Presse, Kuala Lumpur

Three Singapore-based budget airlines are hoping to fly Malaysian
skies following last week's surprise tie-up between the two
countries' national carriers, a report said on Monday.

National flag carriers Malaysia Airlines and Singapore
Airlines (SIA), along with its regional wing Silkair, last
Thursday signed a codeshare agreement for combined services on
some Malaysian routes, including to the northern resort island of
Penang, and eastern Sabah and Sarawak states on Kalimantan
island.

The opening up of Malaysian skies to Singapore airlines has
sparked hopes for low cost carriers operating in the city state
-- privately-owned Valuair, Qantas-backed Jetstar and SIA's 49
percent-owned Tiger Airlines -- that they will be allowed on
board too, The Star said.

"We will be there in a flash if the (Malaysian) government
allows it," Valuair chief executive Sim Kay Wee told The Star.

"Penang and east Malaysian destinations such as Kuching and
Kota Kinabalu are all attractive points to fly into if there are
no encumbrances and available traffic rights."

Tiger Airways is keen to service the Kuala Lumpur-Singapore
sector which is now exclusive to Malaysia Airlines and SIA.

"The KL-Singapore route will be the obvious choice. There is
significant volume of traffic through surface transportation such
as buses and trains. The introduction of low fares on the route
will make it very competitive," said Tiger chief executive Tony
Davis.

Jetstar chief operating officer Con Korfiatis said there was
huge potential in the Malaysian market and the airline was keen
to tap new routes, especially to resort destinations.

Malaysia's decision over the weekend to fast-track the
construction of a 100-million-ringgit (US$26 million) airport
terminal for Asia's growing budget aviation market has fuelled
their optimism, the daily said.

The budget terminal at the Kuala Lumpur International Airport
(KLIA), which will handle 10 million passengers a year initially,
is expected to be ready by June 2006 to rival a similar terminal
planned at Singapore's Changi Airport.

Southeast Asian nations are expected to adopt an open skies
policy between their capital cities by 2008 and fully liberalise
their air travel industry by 2011, the daily said.

Southeast Asia's top no-frills airline, Malaysia-based
AirAsia, is against the entry of more Singaporean players and
warned that opening up direct routes could marginalise KLIA and
hurt Malaysia's ambition to become a regional aviation hub.

AirAsia, which has been blocked from flying to Singapore via
Malaysia's southern gateway Johor and through its subsidiary in
Indonesia, has accused the city-state of trying to prevent it
from competing directly with its own budget airlines and national
carrier.

"If AirAsia is not given rights to fly into Singapore from
Jakarta, why should Malaysia allow the Singaporean carriers
here?" asked AirAsia's executive director Kamaruddin Meranun.

"By giving rights to SilkAir, we are seen to be promoting and
enhancing Changi Airports connectivity and (helping it become a
regional hub). Should we not be promoting our own KLIA as a
regional hub? Why such a move and at whose expense?"

Valuair's Sim argued there was still plenty of room for
growth, adding: "It is a growing pie and there is room for
everyone to grow. It is a matter of seizing the opportunities."