Malaysian MP queries plans for Sarawak-based airline
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- 02 May 2023
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A Malaysian MP has spoken out against a push by Sarawak premier, Abang Johari Openg, to establish a state-owned airline in Sarawak, despite the plan enjoying the in-principle support of the Malaysian prime minister.
The Borneo Post reports Bandar Kuching MP Dr Kelvin Yii, a member of the opposition Democratic Action Party, saying the potential airline was likely to incur significant costs and a thorough and transparent business plan should be conducted before any government funding is approved. As previously reported in ch-aviation, the Sarawak premier is actively campaigning for the Malaysian government to fund, via its sovereign wealth fund, his planned startup airline which would be operated by local general aviation and charter entity Hornbill Skyways (Kuching).
"The premier mentioned that they are looking at obtaining at least four turboprop 120-seater aircraft. A general search shows that it may cost up to MYR155.6 million ringgits (USD34.9 million dollars) each, which converts to MYR623 million (USD139.7 million) for all four aircraft, which again depends on its specifications," said the MP. "It’s important to note that the cost of purchasing an aircraft is just one part of the overall cost of ownership, which includes ongoing maintenance, fuel, insurance, and other expenses."
Yii argues the final cost of establishing the premier's "boutique" airline will run into the billions of ringgits, and that's before any subsidies are paid to make flights affordable to Sarawak residents. Affordable flying is the key pillar of Johari Openg's argument in favour of the airline.
"I will be grateful if the (Sarawak) state government is more transparent with the full deal so we can get a better picture of the whole venture itself,” he said. Yii also noted that the Malaysian government subsidised MASwings (MY, Kota Kinabalu) to operate flights to 49 airports in Sarawak using a fleet of ATR72-500s and DHC-6-400s. The annual subsidies are MYR190 million (USD42.6 million), and Yi suggests expanding this program, if required, would be a more cost-effective alternative.
“My concern has always been that Sarawak may not have the economies of scale to keep it sustainable, and over a period of time Sarawak will have no choice but to use huge sum of our public funds to bail out the airline to keep it afloat."
But the premier's proposed airline does have its supporters. The CEO of a general aviation and charter airline located in the neighbouring state of Sabah, Sabah Air Aviation Sdn Bhd (SAASB), is behind the idea, arguing that such an airline would benefit not just Sarawak but all of Borneo. Read More…
