KUALA LUMPUR: New airline SKS Airways Sdn Bhd is scrambling to secure funding to pay for the delivery of 10 leased Embraer E195-E2 aircraft and is believed to have halted flight operations to two of the destinations it flies to, Tioman and Redang, according to an aviation insider.
SKS AIrways was to start taking delivery of the first Embraer aircraft in January 2024.
It is understood that the delivery of the carrier's first E195-E2 aircraft has been delayed to the second quarter of 2024 from January 2024.
SKS Airways was slated to be Embraer S.A.'s first launch customer in Malaysia, although it is not the only carrier in Southeast Asia that would operate the single-aisle regional aircraft.
"If they (SKS Airways) could not secure funding, there would be a high chance that the deal could be off. It's shaky for them right now but they're searching for new funding," an aviation insider told Business Times.
SKS Airways had announced a RM3.9 billion deal in May 2023 to lease 10 E195-E2 aircraft from U.S. aircraft lessor, Azorra Aviation Holdings.
The airline is expected to commence operations starting March 2024 to neighbouring countries out of Sultan Abdul Aziz Shah (SAAS) Airport although it had planned to receive its first regional jet in January of the same year.
An aviation insider said the future looks cloudy for SKS Airways as the airline still hasn't announced any new destinations.
"December is fast approaching but they haven't announced the destinations that they want to fly to. Regional airports slots at Changi Airport, Soekarno-Hatta International Airport, Don Mueang International Airport and Suvarnabhumi Airport are full and it's hard for new players to secure a slot in these airports," the source said.
The source added that Seletar Airport would be ideal for SKS Airways to fly the premium traveller market that it targets. Checks by Business Times found that SKS Airways has not uploaded any new contents on its Facebook and Instagram since Sept. 29.
It is also learnt that SKS Airways has stopped operating both of its DHC 6-300 Twin Otter to Redang and Tioman since last month.
It is unclear if the halt in operations is temporary or permanent.
Sources said the airline suspended operations to the two islands due to monsoon seasons which typically starts from October to March.
However, SKS Airways had continued to fly to Tioman and Redang in November, December, January and February last year.
"It was running every month since launch (in January 2022) until last month when it was suspended," said a source, adding that the airline's Twin Otter operations had been unprofitable and it is highly unlikely that it will be resumed.
Checks by Business Times on SKS Airways' website found that there are no current available flights to Tioman and Redang from Subang Airport.
Another source added that there is a possibility that SKS Airways' air operator certificate (AOC) could become dormant if the carrier suspends operations for too long.
The airline, which is part of SKS Group of Companies, was awarded the AOC by the Civil Aviation Authority of Malaysia (CAAM) effective Oct 1, 2021.
Business Times has reached out to SKS Airways and Embraer for comment.
In September this year, SKS Airways appointed former Malaysian Research Accelerator for Technology and Innovation (Mranti) chief executive officer (CEO) Dzuleira Abu Bakar as its CEO.