SABAH TOURISM SECTOR WOULD STAND TO LOSE AT LEAST RM72 MILLION A YEAR OVER MAS ROUTE SUSPENSION

Gerakan Sabah censures MAS over route suspension as inconsiderate, not 1Malaysia

KOTA KINABALU 8th Jan 2012: Gerakan Sabah has censured the Malaysia Airlines (MAS) over its recent decision to suspend the routes servicing the Eastern Hub which adversely affect Sabah and its people.

Gerakan Sabah Chairman Datuk Gordon Leong Vui Cheung described such a move as being inconsiderate to the needs and plights of the people of Sabah, besides grossly against the ‘1Malaysia’ concept advocated by the Prime Minister Datuk Seri Najib Tun Razak.

“In a nation that boasts national integration measures by the Government, we are most appalled with MAS’s lack of sensitivity, responsibility and concern about its socio-economic obligation to the nation and in particular Sabah.

“We therefore urge MAS to seriously re-consider the negative action and course which it has chosen to take while ignoring the pleas and concerns of Sabahans,” said Gordon.

In a statement yesterday, in support of the concerns raised by the Minister of Youth and Sports, Datuk Peter Pang, he stressed that the new board members and top management of the country’s national carrier should and must realize and take full cognition of its socio-economic obligation in providing easily available and affordable flights for intra-state and inter-state traveling of the people of Sabah, Sarawak and the Peninsular Malaysia, besides boosting the tourism sector for Sabah.

“We are most disappointed, to say the least, with the recent unhealthy move made by MAS and we do share the concerns, anxiety and worries experienced and raised by all Sabahans, individual travellers to major tourism players alike.

“In the past few days we have seen newspaper reports of instant negative effects of the move by MAS, in particular on how patients seeking urgent medical treatments in Kuala Lumpur and their family members have been forced to take alternative measures and incurring extra and higher costs and also a mother who died without fulfilling her dying wish to see her daughter for the last time due to limited or lack of flights,” he highlighted.

Gordon also expressed grave concern over the almost certain negative effect the MAS’s move has on the Sabah economy, the tourism sector in particular.

He claimed that there is already evidence in the decline of arrivals of tourists in Sabah of late due to the limitation of flights and the cancellation of certain routes, following MAS’s recent announcement of its decision to suspend flights for unprofitable routes serving the Eastern Hub, namely international direct flights from Osaka, Heneda, Seoul and Perth with direct stop-over at the Kota Kinabalu International Airport (KKIA).

“Any drastic changes in the policies and business plan by MAS and its subsidiary, Firefly as a result of the materialization of share swap and business alliance between MAS and AirAsia would inevitably affect the state tourism industry players and the people.

“We truly feel for the plight of the Malaysian Association of Tours & Travel Agents (MATTA) on the decline of tourist arrivals from North East Asia region which has been thus far identified as the potential growth market sector for Sabah,” he said.

He lamented that the said move by MAS has a far-reaching adverse effect on the overall development of the country’s tourism industry, and in turn will jeopardize and hamper the efforts made by the State and Federal Tourism Ministries over the years to promote inbound tourism to Sabah and Sarawak.

He said this will especially hamper the Economic Transformation Program (ETP) and the realization of the Entry Point Projects (EPP) spearheaded by the Prime Minister to boost tourism in Sabah.

“Such a move has and is depriving foreign tourists and business travelers from Japan, Korea and Australia to fly directly to Kota Kinabalu without having to make stop-overs at Kuala Lumpur International Airport (KLIA), besides incurring additional travel costs and unnecessary waste of valuable time,” he said.

He cautioned that with the soaring cost in domestic traveling, it will force holiday makers and domestic travelers to consider neighbouring countries as their destination instead of making a stop-over in Sabah.

Gordon continued that simple arithmetic would show what negative effects the suspension of these direct international flights would have on Sabah tourism sector, basing on last year’s statistic on tourist arrival.

He estimated that Sabah tourism sector would stand to lose at least RM72 million a year, citing the tourists arrival from Australia alone.

“Tourists arrival from Australia was approx 30,000 in 2011 and at an average of 6-night stay at RM200 per person for accommodation, RM100 for food and beverage and RM100 shopping/taxi etc amounting to RM400 per person, per day. Therefore 30,000×6 nights x RM400.00 = RM72 million would vanish from the tourism economy before our very own eyes. And that is only Australia! What about the losses from Japan and Korea? What about the millions of Ringgit both the Federal and State governments and investors have pumped into the tourism industry in Sabah? At a time when tourism in Sabah is picking up, we are slapped with the irresponsible insensitive and negative move by MAS,” he lambasted.

He contended that by right, the frequencies of domestic and international flights plying our KKIA should be increased or at least maintained for now to ensure availability of international and domestic flights for inbound and outbound passengers to and from Sabah.

“But instead, Sabah now faces the worrying possible permanent cancellation of selected international flights plying KKIA.”

“Not to mention that Sabahans and Sarawakians will surely be deprived of the option to buy affordable air tickets and to experience the comfort of domestic and international traveling as and when they feel like flying due to flight limitation options,” he added.

The tourism industry in Sabah would continue to suffer unless the vacuum created by MAS and its subsidiary is filled by other regional airlines or perhaps our Sabah’s very own state carrier immediately, suggested Leong. If really these suspended routes are so non profitable and unimportant to MAS, then it does not really matter to MAS or AirAsia for that matter, if other airlines take over these routes.

He stressed that the new Board members and the top management of MAS should strive to pull in more passengers through effective strategies to make its business more viable, instead of taking the easy way out by suspending the flights routes.

He added that the decision to suspend its fights in the name of business rationalization and the lame excuse of cost cutting should be seen only as temporary measure to stop the bleed, and it will not address the root cause of the problem.

He further contended that what MAS must do is to devise a viable and workable business model and putting the right person to steer the company, adding that there are other more effective beneficial and win-win ways of cost cutting other than routes cutting and MAS, being an experienced big player in the airline industry should have a team of expertise to come up with something better!

“They should be thinking outside the box, including adopting the Blue Ocean Strategy to regain its profitability and long term financial viability,” he said.

He also urged the anti-monopoly Malaysia Competition Commission to carry out a thorough investigation into the share swap and business alliance between MAS and AirAsia, under the newly enacted Competition Act which comes into effect on 1st January 2012, as a measure to protect consumers from any form of monopolistic practices or exploitation.

“At the end of the day, the people of Sabah and Sarawak will be the biggest losers if such a counter-productive policy is being adopted incessantly and continuously by MAS, Firefly and AirAsia,” he pointed out.