Friday 29 Mar 2024
By
main news image

KUALA LUMPUR (March 27): The Malaysian Aviation Commission (Mavcom) has lowered its passenger traffic forecast for Malaysia to range between 68 million and 70 million passengers in 2020, in light of reduced travel demand during the Covid-19 outbreak.

That is a contraction of between 36.2% and 38.1% year-on-year it said, from its initial forecast of a growth of between 4.6% and 5.7% for 2020. In 2019, Malaysia’s passenger traffic recorded an all-time high record of 109.2 million passengers.

The revised forecast, it said, took into account existing flight cancellations by both Malaysian and foreign carriers totalling 14 million seats for the period between January and December 2020, in addition to further seat reductions of 15% for domestic routes and 20% for international routes.

In a statement following the release of the commission's sixth edition of its industry report, Waypoint, Mavcom executive chairman Dr Nungsari Ahmad Radhi said aviation is perhaps the industry worst hit by the global Covid-19 outbreak as travel has almost stopped, forcing airlines to be essentially grounded, thereby putting them in serious financial distress.

"Our Waypoint report paints a bleak picture," he said.

According to the report, Malaysian carriers are continuously reducing seat capacity in 2020 in response to low air travel demand and travel restrictions imposed by countries worldwide.

It said 7.3 million seats have already been cancelled as of March 26, representing 8.6% of total seat capacity for Malaysian carriers this year.

Foreign carriers operating to and from Malaysia have also reduced seat capacity by 6.7 million (24.5% of total seat capacity for foreign carriers) in 2020.

The commission said material developments continue to occur in Malaysia and globally during these unprecedented times, thus quickly affecting the outlook for the industry here.

“As such, Mavcom will continue to monitor such industry developments and look to make adjustments to its forecasts accordingly,” it said.

It added that as an additional measure to strengthen the industry’s financial resilience over the longer term, Mavcom urges the Government to consider relaxing ownership rules for airlines to allow easier sourcing of funds from domestic and international capital markets.

Mavcom further highlighted the need for adherence to merger control provisions contained in the Malaysian Aviation Commission Act 2015 should any step towards industry consolidation via mergers be explored, to ensure industry and consumer interests remain safeguarded.

      Print
      Text Size
      Share