Hub strategy essential for Firefly growth: CEO

Kuala Lumpur
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Malaysia Airlines' (MAS) turboprop operator Firefly will be setting up two new hubs as part of its expansion strategy.

In August, the carrier will start a hub at Senai International Airport in Johor Bahru to take advantage of ongoing developments in the area. From there, it will launch a thrice weekly service on the Johor Bahru-Pekanbaru route.

Johor is ideal because of the Iskandar development - an economic zone planned by the government - which is expected to bring with it much business traffic, Firefly chief executive Ignatius Ong tells Flightglobal Pro in an interview.

He adds that an education city, which will house more than 10 universities, will also be developed in the area - a project that will guarantee student traffic, while families are also lured by a number of theme parks there.

"Its location also means we can market Johor together with Singapore as a twin city holiday package," says Ong. "In the longer term with building Senai we also want to see how Singapore reacts to us. We're not proposing to build Johor to compete, but ultimately we see it as a symbiotic relationship."

In east Malaysia, the turboprop operator plans to start a new hub in Kota Bahru early next year, when it receives its third new ATR 72-600 aircraft.

"It's a huge market in Kota Bahru where a lot of the people travel for work. From there, we're also potentially looking at expanding into Indo China, or a bit more up-north to Thailand," says Ong.

He explains that Firefly is limited to where it can fly to by the range of its turboprops, and hence, having hubs in different parts of the country is essential for the expansion of its network.

"The hub strategy is important for us because we need to play with the constraints of the aircraft," says Ong.

Firefly operates a fleet of 12 ATR 72-500s and one -600. Last year, MAS placed an order for 20 ATR 72s with 16 options. Firefly is thus expecting to take delivery of its second -600 in October, and about three annually, through to 2019.

"The first two to three new aircraft that comes, we're going to use them to strengthen our existing network and increase frequency on high demand routes like Kota Bahru, Penang and Singapore," says Ong.

"I strongly feel that over the next two to three years, there's still a lot more demand in Malaysia and the neighbouring areas where we can play a very important role."

Firefly operates services to Indonesia, Singapore, Thailand and within Malaysia from its hubs at Subang and Penang.