KUALA LUMPUR, Dec 18 — The passenger service charge (PSC) is standardised to facilitate fairer competition between airlines operating at the Kuala Lumpur International Airport (KLIA) and klia2 and to follow international guidelines, Malaysia Airports Holdings Berhad (MAHB) said today.
The airport operator also stressed that klia2 was not a low-cost terminal, describing it instead as a second permanent terminal for KLIA aimed at accommodating increased capacity requirements.
“MAVCOM (Malaysian Aviation Commission) has stated its position that the equalisation will facilitate an environment of fairer competition between airlines operating at these two terminals, as well as allow Malaysia to be better aligned to international guidelines, including with the International Civil Aviation Organisation (ICAO) principle of non-discriminatory pricing at airports,” MAHB said in a statement.
It said the PSC rate mechanism was based on a network and cross-subsidisation model to allow MAHB to operate airports in locations that are not profitable, such as short take-off and landing ports.
“This same model applies to all other aeronautical charges as well such as landing and parking charges for aircraft.
“As an example, in the case of domestic PSC — the same rate is applied in Lahad Datu Airport and in KLIA regardless of differences in available facilities,” it said in a statement.
Likewise, for international PSC rates, MAHB said passengers using Penang International Airport pay the same PSC as the KLIA main terminal.
“It was only different in klia2 where the PSC is lower compared to our other international airports,” it said.
MAHB clarified that the PSC rate was independent of the cost of airport development.
In some countries, it pointed that passengers are charged a separate airport development fee in addition to the PSC, stressing that this was not the case in Malaysia.
“Our PSC rates remain one of the cheapest in the region and in the world, even after the full equalisation,” MAHB said.
MAHB was responding to DAP lawmaker Tony Pua’s claims that it was “unreasonable to try and equalise the fees charged by both the klia2 low-cost terminal and the KLIA”.
The Petaling Jaya Utara MP said it was bizarre for MAVCOM to equalise the rate of PSC between KLIA and klia2, stressing the latter airport was inferior to its former in terms of service.
He then suggested that the true motivation for the increase was to pay for the “astronomical” increase in the total cost of building klia2, which went from RM1.7 billion in 2007 to RM4 billion upon its completion that was also two years late.
Pua indicated that the new PSC rate was needed so Putrajaya need not bail MAHB should the airport operator fail to meet its debt obligation.
Responding to this, MAHB said there was never a need for a bailout, adding that its financial standing remained strong over the last 10 years.
“For Q3 (third quarter) 2017, Malaysia Airports had posted profit after tax (PAT) of RM79.7 million with revenue of RM1.2 billion.
“The strong increase in PAT of more than six-fold increase over the same period last year was underpinned by the strong passenger growth in 2017,” it explained.
MAHB also clarified klia2’s RM4 billion development cost, pointing out that the airport terminal was built for a capacity of 45 million passengers based on AirAsia’s growth projection, an increase of 50 per cent over the original planned capacity of 30 million passengers at the cost of RM2 billion.
“Looking at current traffic performance at klia2, this decision has been validated as klia2 had registered passenger traffic movements of 27 million passengers in 2016, barely 3 years after it begun [sic] operations in May 2014,” it said.
“Among other things, we also took into account the regulatory changes which required for separation of arriving and departing passengers for both domestic and international passengers that had resulted in the need for a bigger terminal from a 3 to a 5-storey terminal,” said MAHB.
The airport operator added that the increase in scope also included a longer 4-km runway, a new air traffic control tower and elevated roads.
Earlier this month, it was announced that the PSC for international flights, excluding Asean, operating at klia2 would be increased from RM50 to RM73 per passenger.
This will come into effect on January 1 and is expected to lead to an increase in airfares.
