More seats to reduce airfares during peak seasons

The decision was made after a study by Mavcom deemed the proposal to introduce ceiling price as unfeasible


Local carriers Malaysia Airlines Bhd, AirAsia Group Bhd and Malindo Airways Sdn Bhd will offer more seats on domestic flights by at least 20% during the festive period, in an effort to reduce air ticket prices.

Transport Minister Anthony Loke said such an initiative will help bring down the domestic airfares, which are prone to spiral out of control during the peak travelling seasons.

Loke said the decision was made after a study by the Malaysian Aviation Commission (Mavcom) deemed the proposal to introduce ceiling price as unfeasible.

“There have been recommendations to put a ceiling price during the festive period, but we found this to be unfeasible because it will affect the normal air ticket prices.

“There is no use for us to set a ceiling rate during the festive seasons if we allow the prices on ordinary days to spiral out of control. That is why we have reached a consensus to offer more seats,” he told a media briefing in Kuala Lumpur yesterday.

The plan is expected to take effect in October this year as airline operators will release their flight schedules for the Chinese New Year festive sea- son in February next year.

A similar deal is expected in March next year for early bookings for the Hari Gawai and Hari Raya Aidilfitri festivities in June.

The airlines will operate night flights to cater to the higher number of commercial services throughout the period.

Loke expects the arrangement would see a reduction in flight ticket prices but he declined to fix a sum which is viewed as ideal.

According to Mavcom’s latest study report, the air ticket prices have increased up to six times during the Chinese New Year period.

In the case of the Ipoh-Johor Baru route, it said the ticket prices went as high as RM1,073 from a base airfare of RM187 as demands spiked during the festive season.

In another example, airfares for the Kota Baru-Kuching route doubled to RM471 from RM236 during the Hari Raya Aidilfitri period.

The aviation regulator, however, did not recommend the imposition of ceiling and floor prices as it would have the unintended negative consequence of higher airfares in general.

Mavcom said Indonesia’s strict imposition of floor and ceiling prices, as well as surcharge rate for all its domestic routes have discouraged competition between airlines and resulted in higher overall prices.

Meanwhile, Loke said the government has beefed up airport security at VIP lanes, following the alleged misappropriation of US$12 million (RM49.69 million) worth of funds transferred by a spy agency via air.

He said Malaysia Airports Holdings Bhd was told to tighten up security at priority areas by enhancing checks and restricting the use of VIP lanes to selected individuals.

“Under the previous administration, government officials and ministers could use these priority lanes. This should not be the way. Not everyone can use the VIP lanes,” Loke added.