AirAsia CEO accuses BAR industry group of bias against low-cost carriers

AirAsia Berhad chief executive officer Riad Asmat derided BAR as ‘inconsequential, self-serving’ after the group came out in support of the High Court decision to dismiss AirAsia and AirAsia X’s application to strike out a lawsuit. — Picture by Farhan Najib
AirAsia Berhad chief executive officer Riad Asmat derided BAR as ‘inconsequential, self-serving’ after the group came out in support of the High Court decision to dismiss AirAsia and AirAsia X’s application to strike out a lawsuit. — Picture by Farhan Najib

KUALA LUMPUR, July 25 — AirAsia Berhad chief executive officer Riad Asmat dismissed today the Board of Airline Representatives’ (BAR) views backing Malaysia’s sole airport operator as a sign it favoured full-service carriers.

He also derided BAR as “inconsequential, self-serving” after the group came out in support of the High Court decision to dismiss AirAsia and AirAsia X’s application to strike out a lawsuit to claim unpaid passenger service charges (PSC) from both airlines.

The two sister companies are locked in a bitter dispute with Malaysia Airports Holdings Bhd (MAHB) over the passenger fees that both have refused to collect after the airport operator standardised this at KLIA and klia2.

“BAR should recognise that LCCs and LCC operations form an integral part of the nation’s aviation and tourism industry, instead of being biased,” Riad said in a statement.

Last week the High Court in Kuala Lumpur ordered AirAsia and its long-haul budget counterpart AirAsia X to pay RM40.6 million in remaining PSC to MAHB subsidiary Malaysia Airports (Sepang) Sdn Bhd. AirAsia is appealing the decision.

BAR welcomed the High Court’s decision in dismissing AirAsia’s application to strike out suits by MAHB over payment of outstanding airport tax, saying in a statement that the refusal to collect the extra-imposed PSC charges from passengers has led to an uneven playing field.

MAHB chief executive officer also hailed the decision, stating it will now allow an environment of fairer competition between airlines operating at both KLIA and klia2, as well as allow Malaysia to be better aligned to international guidelines.

Previously, Riad had openly disputed the PSC rate of RM73 per passenger flying from the airports to destinations outside Asean, arguing that other airports besides KLIA in the country did not have facilities on par with it.

“It must be stressed that AirAsia did not collect these monies from the passengers as we believe they should not be burdened into unfairly paying for inferior services as they would for the more well-equipped and spacious KLIA.

“It is uncanny that the comments by Raja Azmi (Raja Nazuddin) and BAR were similar. As far as AirAsia is concerned, their comments are based on proprietary interests and not in the interests of the travelling public,” he said.

Instead, Riad urged MAHB to consider building a dedicated and functional low cost carrier terminal which charged lower rates, as it will provide the much needed boost for the local aviation industry and position Kuala Lumpur as a key aviation hub.

Although none of BAR’s full service member airlines are based out of klia2, he pointed out that AirAsia in contrast accounted for almost all of the passengers travelling through the budget terminal and it even exceeded the total number of passengers flown through KLIA by BAR’s 39 member airlines combined.

Based on the available data, 97 per cent of the 31.89 million passengers who went through klia2 in 2018 were carried by AirAsia. This is in contrast to 28.1 million passengers through the KLIA main terminal which caters mainly to BAR’s full service member carriers.

“BAR should look at the larger picture of growing Malaysia’s aviation industry and tourism sector, as espoused by Prime Minister Tun Dr Mahathir Mohamad, rather than harp on their own narrow selfish interests,” Riad said.

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