AirAsia dispute with Malaysia Airports rumbles on

Tony with aircraft.JPG

AirAsia is in a tussle with Malaysia Airports, operator of Kuala Lumpur’s low cost terminal, over RM65 million ($18.4 million) in taxes that owes.

The airline refuses to pay until the operator lowers its fees, which AirAsia says are unfair and too high. This comes after AirAsia CEO Tony Fernandes called airport operators “parasites” in a recent interview with our sister publication Airline Business.

The spat comes a few months after Malaysia Airports stymied a bid by AirAsia to build and operate its own budget terminal away from Kuala Lumpur International Airport. It has promised to expand the low-cost terminal at KLIA to cater to AirAsia’s growing business, but the airline doubts that the operator will go far enough.

Malaysia’s government is trying to mediate between the two on both issues.

The result could have implications on how low-cost carriers work with airport operators. Airlines like AirAsia feel that they should get preferential treatment due to the sheer number of passengers that they bring to the airport, and it could pave the way for other carriers to demand the same if it gets its way with Malaysia Airports.

Low cost carriers around the world will be watching the way this is resolved.

, , ,

Leave a Reply