Matta: Malaysian airline industry needs government help to survive Covid-19

  • Malaysia
  • Monday, 20 Apr 2020

Malaysian Airlines, AirAsia and other aircraft at the airport during the movement control order. - AZHAR MAHFOF/The Star

The government needs to urgently look into financial support for Malaysia Airlines to ensure its readiness for post Covid-19 period, said the Malaysian Association of Tour and Travel Agents (Matta).

Its president Datuk Tan Kok Liang said the aviation industry sits at the core of the whole tourism ecosystem. Air connectivity is crucial to the country’s tourism and economic recovery.

“Without airlines to bring in millions of tourists in and out of Malaysia, there will be no viable tourism industry.

"They are the first in the long line of supply chain in the tourism industry that includes airports, road and rail transport, accommodation, food and beverage, entertainment and shopping plus business, education and health services,” Tan said in a statement.

Tan, who was responding to reports of a possible merger between Malaysia Airlines and AirAsia Group, said the national carrier needs a "massive bailout fund".

"The bailout will not only tide it over a short-term financial liquidity challenge but will also assist in putting forth growth far off the pandemic.

"However, steps need to be taken in making air travel palatable to the public again. This may involve a new way of travel with changes for in-flight amenities, health kiosks and conducting rapid on-site Covid-19 test certificates for passengers,” he said.

Tan added that many countries worldwide are expected to bailout their national carriers.

“For instance, the Singapore government has arranged up to S$19bil (RM58.59bil) of funding to support Singapore Airlines (SIA) through the coronavirus crisis.

"Hong Kong has provided a relief package of HK$2bil (RM1.13bil) to ease the liquidity pressure of airlines and aviation support services operators,” he said.

Tan added that the International Air Transport Association (IATA) has also strengthened its call for urgent action from governments worldwide to provide financial relief to airlines.

"It is estimated that the Covid-19 will lead to losses for global airlines amounting up to US$314 billion (RM 1.36 trillion), 25% more than previously forecast,” he explained.

According to Tan, airports in Malaysia have registered a decline of 27.6% with 18.4 million passenger movements. International and domestic passenger movements decreased by 32.4% and 22.4% respectively.

Meanwhile, aircraft movements declined by 11.9% in Q1 2020 over Q1 2019. International and domestic movements declined by 17.5% and 8.2% respectively over Q1 2019.

"But in Q2 2020 it will be worst off as more countries have closed their borders and most airlines have come to a standstill," he said.
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