Aviation industry in Malaysia

Robust demand for international air travel is making Asia-Pacific a pivotal region for connecting flights.

The KL International Airport (KLIA) was ranked the 12th most connected airport globally, according to OAG’s Megahubs International Index 2018.

The index ranks airports with the highest ratio of scheduled international connections to the number of destinations served.

In August this year, passenger traffic in Malaysian airports grew 0.9% year-on-year to 8.5 million passengers.

Domestic passenger traffic increased by 0.8% year-on-year to 4.1 million passengers, mainly contributed by the 5.7% year-on-year growth in KLIA2.

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Meanwhile, the momentum of international passenger traffic in Malaysia has remained consistently above 4.2 million passengers for the past three months.

In 2017, Malaysia received 25.9 million tourist arrivals.

Albeit a dip from 2016’s tourist arrivals of 26.76 million, the total value spent was maintained at RM82.1bil.

Going forward, MIDF Research expects tourists from China to continue to be the driver of air travel demand, due to supportive visa policies in Malaysia.

They accounted for 10% of Asian tourists in 2017.

In terms of airports in Malaysia, several international airports have terminal capacity expansion plans to serve the growing numbers in passenger traffic.

Kota Kinabalu International Airport and Penang International Airport are both in need of a new airport, or expanding the existing facility, as both airports are operating at maximum capacity.

Malaysia Airports Holdings Bhd (MAHB), the operator of Malaysian airports, plans to increase the capacity of Penang International Airport from 6.5 million passengers a year to 12 million passengers a year, and is carrying out an open tender exercise to appoint a consultant.

On the other hand, there was a surge in tourist arrivals to Sabah last year, resulting in Kota Kinabalu International Airport working at its full capacity.

In 2017, there was more than 3.6 million tourists to Sabah, spending a total of RM7.7bil.

Yesterday, Transport Minister Anthony Loke announced that a Malaysian Aviation Council will be set up in November to discuss aviation issues and policies.

He said the first agenda of the meeting shall include discussions pertaining to airport expansion and the financial model for airport expansion.


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