MALAYSIA Airports Holdings Bhd (MAHB) is committed to becoming one of the core key economic accelerators for Malaysia in its bid to become a developed and high-income nation by 2020.
The airport operator plans to impress travellers with its state-of-the-art infrastructure and variety of retail products and services at the newly-launched Kuala Lumpur International Airport 2 (klia2).
MAHB managing director Datuk Badlisham Ghazali said as travellers tend to make their first impression of a country based on its airports, the new terminal is a statement that Malaysia is moving in the right direction.
“Besides, the airport business multiplier effect to the economy is 13 times compared with airlines at six times. We serve nearly 60 airlines today and we have other businesses,
such as retail, logistics and agriculture,” he told Business Times in an interview on Wednesday.
klia2, which started operations on May 2, is set to become a hub for low-cost airlines in Asean. It now houses Malindo Airways, Tigerair,
Cebu Pacific Air, Lion Air and AirAsia, its largest tenant.
MAHB is in the midst of preparing a new five-year plan (2015-2020) as it approaches the tail-end of its current five-year plan dubbed “Runway to Success”, which was implemented
in 2010.
The business strategy is to embrace change due to the growth of budget travel, which carries a different mix of clientele profile, said Badlisham.
“The profile used to be either business travellers or leisure tourists. Now, we have a mix of passengers with spending power.
“This middle-income group is fast rising in Asia Pacific. Airport operators in the region are either upgrading or building new terminals to cater to the new type of customers.
“As for Malaysia, I can say we are ahead of the curve with klia2,” he added.
The new business plan will focus on raising the non-aero contribution to MAHB’s total revenue in the future.
Badlisham said the increase in non-aero revenue was vital as it needed to invest continuously in the upgrading of airport infrastructure to cater to the growth of passenger traffic.
“It may also allow us to create new markets because we have the financial strengths from the non-aero side. The non-aero contribution may be bigger than the aeronautical (aero) revenue in the aviation industry,” he said, adding that the current revenue mix was almost 50:50.
The majority of airport operators’ revenue usually comes from the aero segment, or the charges that they get from airlines.
Non-aero revenue, on the other hand, is derived from non-airline related business, such as commercial, property and agriculture.