A+ | A- | Reset

==> Pls visit new site at http://malaysia-today.net/ <==

Home

The Blogs

Letters/Surat

Social Cost of other Airports

Posted by admin

Monday, 02 February 2009 15:55

The debate over the controversial LCCT-2 has been going on for some time now, and AirAsia obviously must have based their conviction on reliable figures that they can operate a safe, efficient and profitable airport on their own, apart from running a full-fledged airline. That profitability aspect is indisputable, otherwise why would a CEO put money into a sinkhole? Also, the investment cost must have taken into consideration all the necessary expenditure, including contingencies and payments to parties to secure approval of this investment proposal.

However, the debate on this LCCT-2 has so far concentrated on only these three airports, i.e. the current LCCT, Subang and KLIA. I have yet to read any comment or opinion here that recognises the existence of other airports throughout Malaysia. There are airports, such as those in Kerteh and Bario, where the operating cost need to be subsidised so that Malaysians who need to travel to/from these places can do so at a reasonable price to them. This is achieved through intra-group subsidy that comes from profits generated by the bigger airports, including the current LCCT. Having been involved in such a business environment in 1980, I recognise this subsidy as "Social Cost". Unfortunately, this social cost borne by MAHB in maintaining airports throughout Malaysia seems to have been lost in the debate.

While I do not have the figures to make my assessment, I can safely say that AirAsia expects to make a handsome profit by operating its own airport. I have one question. Will AirAsia contribute a portion of its annual profits as its social cost towards maintaining other airports in Malaysia? The portion should not be less than what LCCT is already contributing to the operating expenditure pool managed by MAHB?

On the other hand, if AirAsia chooses to keep all it makes out of LCCT-2, then we, the public will end up having to subsidise the cost of operating other airports in Malaysia under MAHB.

My views are strictly from a business angle and that any cost comparison must be on a like basis.

--- KASSIM S.A.

Comments (16) Add Comment

...
written by lunas oh lunaih, February 02, 2009 16:14:50

wow...PLEASE mobilised a team to encourage young voter to REGISTER with SPR.
Hope fully there will be fresh STATE ELECTION in PERAK

report abuse

disagree 0

agree 8

...
written by lunas oh lunaih, February 02, 2009 16:21:05

Kassim S.A..
You make a point.What Air Asia have in mind is only about PROFIT PROFIT PROFIT at the expense of MAHB,MAS and the rakyat.

report abuse

disagree 4

agree 11

...
written by yipck, February 02, 2009 16:32:18

Yes. I agree Air Asia is mind only about PROFIT PROFIT PROFIT but without the need to spend a single sen of RAKYAT TAX MONEY!!!

Let MAHB, MAS go closedown. They have been draining RAKYAT TAX MOney in BILLIONS of Ringgit for Years.

Which one is the dracula? Air-asia with Profit Profit Profit in Mind that cos Zero sen to Rakyat or the Non Proft MAS MahB that drain BILLIONS of RAKYAT TAX MONEY?

Remember the petrol increase last year to justify the improvement of Public transport? The next week the saving on Petrol Subsidise of RM5Billion was use to bailout MAS.

Who is the one that suffer? WE THE RAKYAT!!
Say yes to Air Asia and NO to MAS and MAHB. !!

report abuse

disagree 12

agree 17

...
written by yipck, February 02, 2009 16:47:57

wow.. got ppl disagree with my comments... wonder what is the reason?
U guys still want to support MAS and MAHB that bleeds our money???? smilies/shocked.gif

report abuse

disagree 6

agree 11

...
written by liny2k88, February 02, 2009 16:48:17

Thanx Kassim S.A. If u din state out the issue about social cost, I might never know about it.

report abuse

disagree 1

agree 3

...
written by Goostee, February 02, 2009 17:10:46

I would suggest that readers also read Malaysiakini's interview with Tony Fernandez which appear in "Another Brick in The Wall" blog and highlighted in Rocky Bru's blog to understand Air Asia's predicaments. To me, Toni has highlighted another Kugan case by standing in the shoes of Kugan's family and sympathisers. He has presented his case well and I believe in getting efficiencies through competition. Hence, I hope the same move would permeate other monopolies such as TNB, Indah Water, Water Supplies and Rubbish collection. Just sad that my similar comments in Rocky Bru failed to see daylight !!!

report abuse

disagree 1

agree 6

...
written by yeechut, February 02, 2009 17:15:40

While I agree that building another airport so near to KLIA is a crazy idea, it is not as crazy as KLIA and how it is being operated. The amount of leakages, non-accountability, non-transparency and wastages surrounding KLIA makes me puke.

I object to Airasia building another airport at Labu, but my BIGGER objection is KLIA itself. Maybe a better solution is for Airasia to take over operating KLIA. I can bet you that Airasia can do a much better job at it.

report abuse

disagree 1

agree 13

...
written by Lyon, February 02, 2009 17:16:33

MAHB builds airports with our money (tax money) and yet not only imposes unreasonable fees for use of the LCCT by Air Asia but also gives preference to 'other' airlines in the use of the runways - could this be one of the reasons for Air Asia delays.

If Air Asia is able to build an airport at a very much lower cost that MAHB is able to do and that to with its source of funds, why do want to object. The Rakyat will gain cos the passenger tax at the proposed new airport is going to be lower that teh current tax to the LCCT.

Think of the bigger picture folks, have a macro view and one will understand the rationale for a new self funded airport.

report abuse

disagree 1

agree 9

...
written by sydput, February 02, 2009 17:25:37

Cost to mahb of subsidising kerteh and bario airports is nothing like the rm10biilion it cost to build klia. klia still cannot afford to pay federal govenrment the billions it owed for the construction of klia. so who's fault was it to build an expensive airport like klia in the first place. it should have been built at a quarter the cost.

report abuse

disagree 0

agree 8

...
written by Su Dhanoa, February 02, 2009 17:56:07

If KLIA wud have been built at quarter of the cost, then how cud the morons have made millions in their Banks Accounts?? Accounting - Losses here and gains in the pockets smilies/angry.gif

report abuse

disagree 0

agree 4

...
written by mypanida, February 02, 2009 18:12:58

All were politically driven projects at grossly inflated prices and cronies' built.
Let all the Rakyat have clean water to drink and cook and bathe and a safe home to sleep in at night and that will be a start.Not much to ask for but after 51 years of Merdeka, all these simplistic necessities and amenities are still beyond reach of the rural folks.
I say to HELL with any new airports.

report abuse

disagree 0

agree 2

...
written by shamadz72, February 02, 2009 21:46:04

Tony is not even willing to pay back his debt to MAHD which amounted to hundreds of millions ringgit, so what do you think Tony is going to pay a single cent to subsidize other airport?

report abuse

disagree 0

agree 2

...
written by InEffective, February 02, 2009 22:39:48

I do appreciate the difficult position of our governing politicians in this case.

They have to balance the change over time in the airline industry from a single state owned airline serving the public (with its associated support infrastructure) to a liberalized aviation sector which allow the advantages of competition and its resulting affordability benefits.

Not easy an easy transition anywhere, but needed if you want to expand the cake and improve the lifestyles of malaysians, and overall progress.

incumbent malaysian politicians should be given due credit here for starting the path to liberalization, and we do hope that care is given to those who face the initial pains of a deregulated but competitive service-industry.

But the goal and the destination and the process has got to be aligned with the rakyat's interests.

So well done DrM, Khazanah, and our governing politicians.. appreciate your efforts at driving a fair balance....

report abuse

disagree 1

agree 0

...
written by born2reign, February 02, 2009 23:21:32

Why is everyone skinning AirAsia and not MAHB and MAS for their excesses?

Does anyone have any ideas on how to prevent LCCT from turning into Puduraya, a shameful place where our tourists get a first impression of Malaysia?

If BN has no problem throwing RM15 mil or RM50 mil in Perak and giving RM500mil commission to DPM, what's some subsidies for maintaining other airports?

Unless everyone wants to go back to flying fullfare with MAS... many non-bumiputera businesses have to "feed the UMNOputeras" to stay afloat and give jobs to all Malaysians..so this involves playing some politics.

I applaud AirAsia for showing every Malaysian how MAS and MAHB have been ripping us off for decades. For the satisfaction of passengers, if MAHB is not operating LCCT well, then MAHB must be terminated. No love lost here.

Does anyone question why MAS gets to approve/reject AirAsia routes? MAS is just another airliner. Even HCMC Vietnam airport is better than LCCT. MAHB memalukan Malaysia!

report abuse

disagree 0

agree 2

...
written by MAGELLAN, February 03, 2009 00:42:05

The current LCT in KLIA is a scam, a total waste of public funds. Has anyone seen the Singapore LCT? It is miles ahead of our LCT. Why in the hell did MAHB build such a poorly designed and equipped airport? The answer is simple, so that they can continue to give more projects to their own cronies. I sympathise with Tony Fernandes on one hand, but on the other, many of you don't see the bigger picture.

Airasia is funded by an unknown and unseen entity and not just Tony himself. Ask yourselves how this man can secure funding for up to 150 planes in a short span of time? Where does the funding come from?

I agree that Airasia has brought us cheap travel to every Malaysian, but I still find it hard to believe how it can be done so easily. There must be some powers behind the company that secures all the landing rights not to mention the airspace rights in Malaysia. Wonder who is actually behind Airasia??? We the rakyat are always used as the excuse for Airasia to expand. At the end of the day it only benefits us by allowing us to travel, what about the benefits the hidden hand gains from it??

Does anyone know that the difference of cost of the airport tax between KLIA and the LCT? It is just RM5 per passenger. Do you know that KLIA has excess capacity??? Sometimes the airport is so quiet! The most sensical thing to do is to build another satelite building within KLIA and expand the runways. KLIA has the option for up to 4 runways and only 2 was built. Expansion will make KLIA a truly international airport. In fact due to Airasia's strong growth in Asia, KLIA could become to mot busiest airport in Asia and perhaps one day we may overtake Changi.

I am all for the LCT being improved and remaining in KLIA.

report abuse

disagree 0

agree 3

...
written by iMac, February 04, 2009 11:27:50

"I know Malaysians very well," said Fernandes, a native of Malaysia. "If you put a fare low enough, they'll risk their lives," he said, as the crowd laughed.

Source: www.columbusdispatch.com/live/...ml?sid=101

WHAT AN ARROGANT S.O.B.

report abuse

disagree 0

agree 1

Write comment

This content has been locked. You can no longer post any comment.

You must be logged in to a comment. Please register if you do not have an account yet.