KUALA LUMPUR: Malaysia stands to lose its steam to be an aerospace and aviation hub in Asia Pacific if Subang Airport is no longer part of Malaysia Airports Holdings Bhd's (MAHB) network.
In saying this, MAHB said the country's cross-subsidisation model between profitable and loss-making airports would weaken.
The Kuala Lumpur International Airport's (KLIA) network connectivity would be cannibalised, thus impairing the airport operator's financial and business strength, the airport operator added.
"Dividend returns contributed by MAHB to government-linked investment companies will also be impacted. Our revenue-sharing proportion with the government is currently the highest in Asean with over 12.6 per cent, in comparison to neighbouring countries," said MAHB told the New Straits Times yesterday.
MAHB said this in response to WCT Holdings Bhd's recent proposal, via wholly-owned Subang Skypark Sdn Bhd, to re-concession Subang Airport, allowing the company to operate the airport without having to take full ownership.
MAHB's current shareholding boasts 27 per cent foreign shareholders with the majority of 62 per cent stake owned by local institutional investors namely the Retirement Fund Inc, Employees Provident Fund, Khazanah Nasional Bhd and Permodalan Nasional Bhd.
"The government has granted the concession and exclusive rights to MAHB to operate 39 airports. Following this, we have invested heavily to promote the growth of passenger traffic as well as airport network connectivity," said MAHB.
A change in the direction for Subang Airport would also disrupt the ongoing Subang Airport Regeneration initiatives, warned MAHB.
"It may also adversely impact the confidence of the aviation and aerospace industry players and affect the future investments within this high-value aviation and aerospace industry," it said.
MAHB's Subang Airport regeneration initiative will expand the current maintenance, repair and overhaul (MRO) and aerospace ecosystem, providing end-to-end, mid to high-value capabilities and solutions, anchored by top tier operators and supported by local value chain and SMEs.
This is in line with the original intent of the government's aspiration to turn Subang Airport into an international aerospace centre and general aviation airport.
Subang Airport currently hosts over 60 operators with 4,000 jobs created, contributing 20 per cent of the annual revenue of Malaysia's aerospace industry.
"MAHB's development and plans are also fully aligned with the Malaysian Aerospace Industry Blueprint 2030 which has a vision of placing Malaysia as the number one aerospace nation in Southeast Asia," the company said.
Under the masterplan, Subang Airport is poised to be the region's preferred one-stop centre in providing end-to-end services with complete state-of-the-art infrastructures, leveraging Malaysia's position as the fourth largest base for the business jet fleet in Asia Pacific.
Among the potentials are helicopters, business aviation and light aircraft.
The initiative prioritises national plans and ambitions that provide optimum growth potential for all aviation and aerospace segments namely scheduled commercial, business and general aviation, aerospace, MRO, air cargo; while preserving the viability of the national airport and airlines operations.
"The five-year accelerated Subang Airport Regeneration initiative will see an investment of RM1.3 billion in capital expenditure for common infrastructures and build-up facilities for tenant-operators, of which a significant amount is aimed to support the operators, especially the local, SME operators who struggle to raise financing for capital development," it said.
MAHB added that the Subang Airport Regeneration initiative can be executed expeditiously, without being a cost burden to the government.
The initiative is aimed at generating RM5.4 billion in economic output, creating 19,000 high-value jobs and supporting a further 74,000 jobs in the overall economy.
MAHB has asked the government to review any proposal to reconcession the airport to private entity, although it said proposals to acquire an airport by a third party/private entity was not uncommon.
It was a standard process for the government to obtain opinions from the aviation stakeholders and regulators such as the Civil Aviation Authority Malaysia, Malaysian Aviation Commission, airport operator and airliners before reaching to a decision, it said.
"MAHB still remains a subject matter expert in managing airports as we are one of the top five largest airport operators in the world," said MAHB.