MAG confident Boeing deliver eight B737 MAX 8 this year, calls on policymakers to jointly work on Subang Airport expansion

LANGKAWI: Malaysia Aviation Group (MAG) is confident that it will receive eight of its Boeing 737 MAX 8 aircraft from the American plane manufacturer this year as it is ramping up its fleet renewal program. 

MAG group managing director Datuk Captain Izham Ismail said currently Malaysia Airlines Bhd has three B737 MAX 8 and one aircraft is delayed but he has high hopes that Boeing would meet the delivery schedule. 

"I'm confident that Boeing will send us the airplanes this year. We have had work done together and I know Boeing has a lot of work trying to revamp themselves, improve the processes."

"To be fair to Boeing, it's also their suppliers as well (that contributes to the challenges Boeing are facing). It's actually giving them headache and I believe Boeing is looking into it seriously," he said. 

Izham was speaking at Routes Asia chief executive officer (CEO) keynote interview here today. The event is hosted by Malaysia Airports Holdings Bhd (MAHB) and Tourism Malaysia. 

MAG had ordered a total of 25 B737 MAX 8.

It also has a firm order of 20 Airbus A330neo (new engine option) in its current fleet orderbook.

Izham said the aviation group is looking forward to complete the delivery of the narrowbody MAX 8 by 2026 while expecting the first of the widebody A330neo to arrive in September this year. 

"We're running a campaign on our additional narrowbody. We're also evaluating very closely whether to exercise the option for new A330neos," he said, adding that by 2033, MAG plans to have at least 50 narrow-body and 50 wide-body aircraft inclusive of the seven A350-900 that we have. 

In August 2022, MAG acquired 20 A330neo powered by Rolls-Royce Trent 7000 engines that will replace its existing A330ceo (current engine option) fleet. 

The airplanes are scheduled to be delivered to the group starting third quarter of 2024 through to 2028.

On the Sultan Abdul Aziz Shah (SAAS) airport or better known as Subang Airport, Izham said it is crucial for policymakers to ensure that it moves to the right direction. 

He said the planned expansion of the airport would be a challenge to Kuala Lumpur International Airport (KLIA) even though the strategic value of the Subang Airport is important. 

"Whichever you cut and dice, whether it's capacity neutral, frequency neutral…it's quite tough. It's going to be a challenge."

"Industrial players must be able to balance this capacity neutral, frequency neutral between KLIA Terminal 1 and Terminal 2 and Subang (Airport) itself," Izham said, adding that the SAAS airport is definitely better suited for a point-to-point network. 

Izham also called on the policymakers and designers of Subang Airport to work with MAG and industry players to ensure that all the parties strike a very strong balance between what Malaysia needs and what the industry needs. 

Running an airline is expensive with billions of dollars involved, he said, thus having profitable airlines are crucial so that the carriers can reinvest back into the market, economy whilst creating jobs. 

"But if you create unnecessary overcapacity, unnecessary additional hub, you actually making the industry racing to the bottom. When it races to the bottom, it stresses the economy of the country, it stresses a lot of things."

"Every path that we take, we must identify those risks, and you must understand those risks and how to mitigate them. Otherwise, we are just bulldozing something, and three, four, five years down the line, all of us will be racing to the bottom," Izham said.

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