Launch New CPI

When talks emerged last year about expanding the air services agreement (ASA) between Malaysia and Singapore, industry observers took this as a sign that the Kuala Lumpur-Singapore route will be finally made available to other airlines, putting an end to the long-held stranglehold by ‘duopoly’, Malaysian Airlines System (MAS), which owns Malaysia Airlines and Singapore Airlines (SIA). Aviation analysts say that it is about time that Malaysia and Singapore open up the much-guarded route. The existing ASA was last reviewed nearly 30 years ago. Since then, all air traffic rights for the Kuala Lumpur-Singapore sector has been fully used up. As a result, new carriers were unable to service this route.

Budget airlines have been lobbying for the decades-old agreement to be dismantled, arguing that low-cost carriers (LCCs) will promote healthy competition, maximise efficiency, and ultimately, passing on gains to travellers through lower airfares. For travellers, this is indeed terrific news. Especially when they have to fork out over RM800 for a round-trip ticket, inclusive of fees and taxes, just for a mere 40minute ride.

Author: Wong, ChayNee. Publication: MIERScan, 28 May 2007.