By Ajit Johl

KUALA LUMPUR, Malaysia--4PAM is shocked over the reports that have been appearing in the major newspapers on the purported Subang Airport takeover. 4PAM is extremely concerned that the Ministry of Transport (MOT) or the Government has not quashed such a rumour or denied receiving such a proposal.

An inexperienced organisation should not be allowed to operate an airport. Taking over an airport is a serious issue, and has many ramifications, from passenger safety & security, compliance to international standards, strict regulations, enforcement, and human lives are at stake.

The silence coming from the authorities is shocking and the Minister of Transport must issue a response on this, said 4PAM President, Ajit Johl.  

“From the information made available one can only assume this seems more of a land grab, asset striping and closing of a profitable airport”, said 4PAM President, Ajit Johl

MAHB was a special purpose vehicle created by the Government to spearhead the air travel industry and at one point was the second largest airport operator in the world, managing 130 Million passengers per annum. 
With the opening of KLIA2, it boosted the low-cost travel industry which allowed many Malaysian to travel and expand their business in the region and provided tourism revenue for the country.

MAHB has a national duty to ensure all 39 airports are running and 4PAM has been made to understand that not all the airports are profitable. MAHB must cross subsidize these airports to provide air connectivity for tourism, medical, education and basic transport to Malaysians especially in the rural parts of Sabah & Sarawak.

The economies of scale enjoyed by MAHB, cannot be duplicated by a single airport operator and eventually the cost would be passed on to the passengers. 
The aviation sector is not expected to recover until 2025, and how is a single airport operator, going to survive and provide the cross subsidies? 
“The proposal is akin to picking the crown jewels, or asset stripping of a successful organization, instead of capitalising on each organisation’s core competencies,” added Ajit.

Except for last year due to the global impact of the pandemic, MAHB has never had a red year, which speaks volumes of its management capability. 
Over 60% of MAHB shares are owned by various institutions like Khazanah, KWSP, KWAP and PNB, that have been providing positive dividends to the rakyat.

These dividends would be lost if the Subang airport is sold over to a single privately owned airport operator. Why should the rakyat lose on the dividends that is being generated by Subang Airport and its potential expansion by this takeover?

MAHB submitted a proposal to redevelop Subang Airport and Skypark to MOT in 2018, which has yet to be approved, but a proposal submitted in April 2021 seems to have made its rounds and is ready for a cabinet discussion, according to major newspapers.
“4PAM hopes the Minister is able to comment and clarify this issue, as it does not augur well for the Aviation industry, that is going through the worst period in its history” added Ajit Johl.

4PAM is equally concerned on the risk and impact of a city airport and the surrounding development. In hindsight the KLIA & KLIA 2 development over the last 20 years augurs well and MAHB foresight has brought positive value to surrounding areas like Sepang, Nilai, Semenyih and so forth. In a matured area like Subang, the opposite might happen. A city airport may bring down the value of the surrounding land.

This is seen in foreign countries where, housing value near the airport crashed due to the unwarranted noise and pollution factors. So, the idea to redevelop the whole area into malls and commercial business parks without an experienced airport operator could bring disastrous result or even the closing of a historic airport that is currently profitable.

MAHB on the other hand have plans for Subang Airport and has paved the way for the development of aviation and aerospace ecosystem with their Subang Airport Regeneration masterplan and has funds to do it. 
MAHB a triple A rated company, has the ability to fund the RM 1.3 Billion proposal to redevelop Subang Airport and SkyPark. The track record of KLIA and KLIA 2 is ample proof that MAHB knows what needs to be done to build a city airport.

4PAM, suggest the best way forward was for MAHB to remain as the countries airport operator and urge the government to allow MAHB to take over Senai Airport and consolidate all airport management under MAHB.

We encourage developers to come forward and work with MAHB, as the master developer of this huge real estate potential and make it into a strategic airport, aviation and aerospace ecosystem that will become the pride of the country. 
Finally, the redevelopment should not go into the hands of a single organisation, as that by itself is a huge risk and we have seen that, added Ajit.