The Department of Civil Aviation Malaysia (DCA) announced that effective 15th April, airlines operating out of Malaysia will be charged 10 times more than the current rate.
The increase in fees will be applied to everything such as the usage of air space, air traffic facilities, air operator’s certificate (AOC), and pilot’s flight license. This decision was made under a review of fees and charges by the DCA after 40 years.
According to the revised fee, bigger aircrafts will be charged more and even the smaller jets, cargo planes, and helicopters will not be spared. This will definitely affect the airlines’ bottomlines and may lead to an increase of airfares for travellers.
Some airlines were briefed by the DCA officials last Friday (1st April), but were surprised that they will start execution so quickly. This rise would lead up to a ten-fold increase in an airline’s monthly air navigation flight charges (ANFC), which is the biggest cost item for the usage of DCA services.
“The rise is too drastic and too fast,” said an airline executive.
He also said that airlines like AirAsia, Malaysia Airlines, and Malindo Air will take the worst hit by these new charges because they have several hundred domestic flights per week.
Based on the DCA briefing, the ANFC charges will rise from 5 sen per nautical mile to 50 sen for lightweight aircraft. For the bigger planes like Airbus 320/330 and Boeing 737/777, the cost will rise from 10-25 sen to RM1-RM2.50 per nautical mile, the Airbus 380 price will increase from 30 sen to RM3 per nautical mile. The minimum charges will be raised from RM5 to RM50 per nautical mile.
As for the AOC, which is an important document for airlines to fly, the initial approval fees for mid-sized aircraft will increase from RM400 to RM80,000, and yearly renewals fees will rise from RM400 to RM30,000.
Pilots who have to be licensed to fly will have to pay RM500 for their initial flight crew licence and RM300 for yearly renewals.
“We have to upgrade our systems, maintain and replace them as we want to give them the best. Hence, we have to charge a bit. In any case, there has not been a revision in the pricing since 1970 and it costs us money to provide the services,” DCA director-general Datuk Seri Azharuddin Abdul Rahman told StarBiz yesterday.
Although Azharuddin said that Malaysia’s fees is still lower than some other countries in the region, another airline executive said that the DCA’s new fees are higher that Singapore and Thailand, and that they need to review its rates.
The DCA spent RM1.41bil to build infrastructure and systems and the new KL air traffic control centre (ATCC) will be expected to operate by 2018/2019, and would need about RM550mil to upgrade Kota Kinabalu ATCC and other systems’ upgrade in the country.
Source: The Star.