As Malaysia reopens to the world, airlines see healthy pick-up in flight bookings

Nick Goh stepped into Kuala Lumpur International Airport (KLIA) recently, his first time entering Malaysia's main airport ever since the country shut its international borders in March 2020 to curb the spread of Covid-19. 

To his surprise, the 43.7-hectare airport was busy and full of life, unlike what the local media had portrayed just a few months ago. 

“Almost all the chairs at the waiting area were occupied by tourists waiting for their flights, and the cafes and restaurants were at least half-full. Although it’s not as busy as it was in 2019, I'm still happy to see crowds returning to Malaysia,” the 43-year-old, who is self-employed, told The Business Times just before he boarded a domestic Malaysia Airlines flight to Kuching.

Malaysian aviation industry players, who were battered by the coronavirus pandemic, are now upbeat on future growth as they are seeing surges in flight ticket bookings since the government announced in March that the borders would fully reopen on April 1.

Bo Lingam, group chief executive officer of AirAsia Aviation Group, said that AirAsia Malaysia has seen a 20 per cent increase in bookings for domestic and international destinations in the first quarter of this year, compared to 4Q 2021.

“Thanks to accelerated vaccines across our core markets and the world living with Covid-19, we believe we will return to 100 per cent of pre-Covid capacity on our key routes by the end of 2022,” he said.

The budget carrier currently operates 75 out of its total fleet of 200 planes. Of the 75 in use, about 60 per cent are used for domestic flights and the rest are for its operating units in Thailand, Indonesia and the Philippines.

He noted that with other countries having streamlined and simplified their Covid-19 testing regimes, this will further boost the recovery of the tourism sector which would in turn fuel the growth of the aviation industry.

A spokesperson for Malaysian Airlines told BT that its ticket sales surged over 100 per cent after the border reopening announcement was made in March. The national carrier is seeing a load factor of more than 80 per cent on most of its upcoming flights.

Still, the demand remains below pre-pandemic levels and the airline's parent company - Malaysia Aviation Group - aims to operate at 70 per cent of its 2019 capacity by the end of 2022, with a gradual increase in the frequency of flights.

Currently, the airline has 80 planes serving over 100 destinations across 6 continents. In South-east Asia, Singapore, Bangkok, Phuket, Bali, Ho Chi Minh City and Manila are the top destinations. Other popular outbound international destinations include the UK, Australia, India and Bangladesh, said the spokesperson.

In a report last December, Malaysian Aviation Commission (Mavcom) - an independent body set up under the Malaysian Aviation Commission Act to regulate economic and commercial matters relating to civil aviation - projected the country’s air passenger traffic to increase by as much as 525 per cent in 2022 compared to last year. This would translate to as many as 49 million passengers in the skies, mostly driven by demand for domestic and Asean routes.

The large jump is due to the low base effect in 2021, said Mavcom, adding that the projection also marks a 30 per cent to 45 per cent recovery from the levels seen in 2019 before the pandemic.