Malaysia’s pandemic-born low-cost carrier MYAirline gearing up for regional routes

[Kuala Lumpur] MALAYSIA’S newest budget carrier MYAirline, which only took to the skies last December with eight local routes, will soon spread its wings to Thailand, Singapore and other regional destinations.

In just four months, the low-cost airline already operates six Airbus A320 planes that fly from the capital Kuala Lumpur to Kuching, Kota Kinabalu, Langkawi, Kota Bharu, Penang, Sibu, Tawau and Miri. Earlier this month, a new intra-Sabah route between Kota Kinabalu and Tawau was added.

In an interview with The Business Times, co-founder and chief executive officer Rayner Teo revealed that Thailand is likely to be the airline’s first foreign destination.

The plan is to start selling tickets to Bangkok from May. And with more planes scheduled to be delivered in the next two months, the company is considering adding Phuket to its list of routes later this year.

“We were hoping that Singapore would be our first foreign destination, but looking at the progress, it looks like Thailand will be the first,” he said.

He added that the airline is also likely to gain flying rights to Indonesia and Vietnam before Singapore, depending on the approval process with the respective authorities.

MYAirline’s route expansion is supported by its equally fast-growing fleet size. The company has signed leasing deals for 17 A320 planes and is very close to obtaining another five.

This will add to its current fleet of seven aircraft. The last of those seven planes is currently undergoing the registration process in Malaysia.

“We have to work fast (to lock in the deals) because the opportunity on the leasing side will gradually disappear as the market recovers,” Teo said, adding that the company is also in talks with both Airbus and Boeing for future aircraft.

MYAirline’s goal is to end this year with at least 23 planes in its fleet, although Teo said he would be happy with 20.

He also said the airline plans to operate as many as 80 aircraft in five years’ time, with some routes expected to exceed the current four-hour flight range. An initial public offering is also part of the midterm plan, he said.

Perfect window of opportunity

As ironic as it may sound, the Covid-19 pandemic that forced international borders to shut for almost two years and planes to be grounded worldwide, turned out to be the perfect window of opportunity to set a promising start for an airline.

The aviation downturn allowed MYAirline to quickly recruit experienced flight crew and secure aircraft leases on attractive terms, resulting in the company growing at a faster pace than initially planned, Teo said.

Making its maiden flight on Dec 1 after some initial delays also meant that the airline was able to capture one of the busiest holiday periods post-pandemic.

“There was a lot of stress in the early days trying to get this off the ground at the heights of the pandemic. Nobody saw that the borders would be closed for two years,” Teo said.

The idea of setting up MYAirline came about during the Covid-19 lockdown in October 2020, when Teo was back in Malaysia from an abruptly shortened stint as the commercial adviser for Thai VietJet Air in Bangkok. Before that, he spent 15 years at AirAsia as the group’s head of sales and distribution.

“A friend that I had known for a long time, Allan Goh, wanted a piece of the aviation pie. He wanted to own an airline because, to some people, it’s still a sexy business. We had a short, simple discussion and decided to proceed as the timing was perfect,” Teo recounted.

Goh, whom Teo has met during his AirAsia days, was a provider of ticketing kiosk solutions. Goh’s diversified business activities also included a payment gateway, money lending and financing, and a grocery chain.

Goh controls 98 per cent of MYAirline, with the remainder owned by Teo. The pair went on to assemble the top tier of the company’s board with industry veterans including former Malaysia Airports Holdings chief operating officer (COO) Abdul Hamid Mohd Ali and former Malaysian Civil Aviation Department director-general Azharuddin Abdul Rahman.

Besides the directors, many members of MYAirline’s leadership team – including current COO Stuart Cross – have spent years at AirAsia, giving them the relevant experience to run the airline from the get-go.

Armed with more than three decades in aviation, Teo is learning from the experience and is aiming to do better.

“We are not here just to fill in the gaps; we want to be a significant player. We want to make the change in the industry,” he said.

The list of target improvements includes boosting transparency in communications with passengers during service disruptions and increasing airline reliability by having a spare plane at any given time, something he admitted is easier said than done.

“We want to raise the service levels such that after you’ve purchased the flight ticket, you can still get in touch with us. We don’t believe in (a recorded) voice. We are also very active on social media and try to respond to the comments there,” Teo said.

“So far, we’ve heard good comments. The key is how do we keep this going as we grow, and hopefully egos don’t get in the way. When you grow too big too fast, there are a lot of risks. We hope to not make the same mistakes.”