It's a monopoly

The travel trade in Sabah and Sarawak believes that Firefly’s impending discontinuation of flights from Kuala Lumpur to Kuching and Sibu in Sarawak, and to Kota Kinabalu and Sandakan in Sabah will create a monopoly, push up prices and curtail short and longhaul traffic into the region.

Coming on the heels of the decision to shut Firefly’s Johor hub offering direct flights to Kuching and Kota Kinabalu, Kevin Nila, regional marketing manager, Malaysia & Singapore, Sarawak Tourism Board, said the twin exits would only benefit AirAsia, Firefly’s only other budget competitor on the routes. “It’s a monopoly now,” he said. “There’s no more freedom to choose your own airline. It’s like having a single telco with full control over the entire region.”

Noredah Othman, senior marketing manager, Sabah Tourism Board, agreed with her Sarawak counterpart, saying although Malaysia Airlines (MAS) offered a deluge of flights into both state capitals, they were premium category, and Firefly’s exit had removed the only barrier discouraging AirAsia from raising its fares.

She said: “Firefly provided good competition for AirAsia. Travellers are very price-conscious nowadays, and there are never enough flights into Kota Kinabalu. Previously we had 80 MAS, 63 AirAsia and 42 Firefly flights from Kuala Lumpur per week. Some 8,000 weekly seats will no longer be available once Firefly pulls out.

“My main concern is Sandakan, which receives a lot of longhaul from Australia through Kuala Lumpur.”

Charlie Chan, director-operations & sales, Kota Kinabalu-based Borneo Passages, was another who predicted that AirAsia fares to East Malaysia would see a subsequent increase. “AirAsia rates will go up for sure. For MAS and AirAsia, their rate is always ‘right’; their attitude is that ‘it’s my rate, not your rate’,” he said.

Noraini Ahmad, sales manager, Peninsular Malaysia, Borneo Convention Centre Kuching, said rates on AirAsia’s flights from Kuala Lumpur to Kuching were already increasing at an alarming rate. “During peak season, they are even more expensive than MAS tickets,” she said.
-TTG Asia.