Wednesday 7 December 2011

AirAsia and MAHB’s key disagreements

On the service level agreement (SLA):
AirAsia: MAHB should come up with a service level agreement (SLA), which should incorporate aeronautical charges at the new low-cost carrier terminal (LCCT) KLIA2. With a SLA, AirAsia is ensured good quality of service by MAHB, especially at the LCCT. What AirAsia has now is only a condition of use (CoU) agreement, which is a “useless piece of paper”. AirAsia has SLAs with airports abroad, so why not with MAHB?

MAHB: The current CoU is very much in line with the common industry practice. With regards to AirAsia’s request for a specific service level agreement (SLA) and its claim of having SLAs at airports abroad, we have indicated our willingness to have an SLA and are awaiting AirAsia’s proposals on the SLA for further study and consideration.

We would also like to reiterate that the airport charges, both current and future, are regulated by the government and the mechanisms for future increases have been clearly defined in our operating agreement with the government.

On the KLIA2 site selection
AirAsia: AirAsia has outlined in detail the requirements and done costing at a site that it had chosen. It would only cost RM700 million to build the new LCCT. AirAsia’s request was to build the terminal building at a different site in the north, nearer to the KLIA main terminal, which required no additional Runway 3, which added another RM180 million to the entire cost of KLIA2.

MAHB: The present site for KLIA2 was selected based on the National Airport Master Plan (NAMP) after a detailed and comprehensive study involving all our stakeholders including the Ministry of Transport, Department of Civil Aviation, Ministry of Finance, Ministry of Home Affairs and all airlines including AirAsia.

On a joint working committee
AirAsia: Had MAHB agreed to set up a joint committee as requested by AirAsia, the airport operator would have avoided the ballooning of costs at KLIA2, as all the requirements by the airline would be met from “day one”.

The weekly meetings held with AirAsia were “one-sided” and MAHB decided unilaterally on whether or not to grant AirAsia’s requests. AirAsia was not asked to sign off the minutes of meetings.

MAHB: The weekly meetings held with AirAsia and other stakeholders served as a platform for all views and requirements to be discussed and addressed. ost of AirAsia’s requests have been complied with. Only issues which have financial implications are referred to the board.

We will continue to engage AirAsia during the weekly meetings. It has always been MAHB’s view that in dealing with our partners, issues raised by either party are best resolved through proper consultation. However, from time to time, we are duty bound to make clarifications so that the public receive accurate information and a balanced perspective.


This article appeared in The Edge Financial Daily, December 7, 2011.



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