'Higher charges could hurt MAS, AirAsia'

Both Malaysia Airlines and AirAsia, are expected to see a direct impact on earnings from the higher aircraft parking and
landing charges, announced by Malaysia Airports Holdings Bhd (MAHB) on Tuesday.

Hong Leong Investment Bank said it is estimated that each airline will incur an incremental RM9 million per annum for the next three years.

In a research note today, Hong Leong Investment said however, both aviation companies are likely to pass through the additional cost to customers.

"The additional cost for AirAsia’s passengers is estimated at only 45 sen per pax and MAS at 64 sen per pax. "There might be concerns over the potential impact to overall air travel

demand. But, we reckon that the additional cost of RM7.50-RM14.50 is very marginal, and unlikely to have significant impact on demand," the research house said.

MAHB has announced that it would be implementing a new international passenger service charge (PSC) as well as aircraft landing and parking charges at the airports operated by the group.

It said the government had given approval and that it was in line with the Operating Agreement signed between the government and MAHB in February 2009.

MAHB said the international PSC would be increased from RM51 to RM65 at the KLIA Main Terminal Building, Sultan Abdul Aziz Shah Airport in Subang, Langkawi International Airport, Penang International Airport, Kota Kinabalu International Airport Terminal 1 and Kuching International Airport.

It said the charges will be raised from RM25 to RM32 at the Low Cost Carrier Terminal KLIA and Terminal 2 Kota Kinabalu. The new rates are applicable from Sept 15. -- Bernama