The Asian Business Aviation Association (AsBAA) has assisted consultancy Frost & Sullivan on its new report Opportunity to Develop a Regional Business Aviation Hub in Malaysia.
The report claims that increasing costs of operation and high congestion at the existing business aviation hubs in the Asia-Pacific region offer an opportune setting for an airport in Malaysia to emerge as the next hub in the region.
It says the economic progress of Malaysia and a growing number of high net-worth individuals in the country is leading to a steady growth in the demand for business aviation.
The regional dynamics of the industry – wherein existing hubs such as Singapore’s Selatar airport and Hong Kong International Airport are giving preference to commercial flights – present an ideal moment for Malaysia to capitalize.
Frost & Sullivan estimates that the business aviation fleet owned and used by Malaysians, which stood at 51 jets in 2017, can potentially reach to 124 jets by 2030.
As per a recent survey conducted by Frost & Sullivan among industry stakeholders in the Asia-Pacific region, Sultan Abdul Aziz Shah Airport at Subang in Malaysia is the most favoured choice for the next business aviation hub in the region.
Frost & Sullivan consultant Nishant Dey Purkayastha said, “Subang is already the most frequently used business aviation airport in Malaysia and it has potential to develop even further.
“However, the industry has several roadblocks that need to be mitigated in order to realize the full potential. Regulatory issues related to registration, financing and cabotage policy are major roadblocks.
“For instance, only 30% of the fleet based out of Malaysia are registered in the Malaysian registry. The others are registered in other countries. This hampers the domestic charter industry as the internationally registered jets cannot be used for domestic operations. Other hurdles are in the form of infrastructure-related issues and operational issues.”
The availability of a complete ecosystem, including charter operators, authorized maintenance centers, fixed-based operators and parking space, were key reasons that helped Singapore and Hong Kong to emerge as hubs for business aviation.
“Subang currently does have a decent ecosystem, with some leading global names such as ExecuJet and Hawker Pacific, as well as established local players like Smooth Route, Sapura Aero and Redland Aviation,” added Dey Purkayastha.
“However, some aspects of the value chain such as painting and modifications, flight simulation and training, and parts distribution and logistics are missing. Malaysia will need to attract investments to fill up the gaps and complete the ecosystem.”
Currently, Subang’s annual business jet movement stands at around 3,200. The leading business aviation airports in the Asia-Pacific region are Beijing (9,000 movement), Hong Kong (7,250 movement), Shanghai (5,000 movement) and Singapore (4,900 movement). Subang’s numbers are marginally ahead of Bangkok’s Don Muang airport and Manila’s Ninoy Aquino airport.
As per Frost & Sullivan’s analysis, if the issues in the ecosystem in Malaysia can be addressed, the annual business jets movement in Subang can potentially reach a figure of 9,299 by 2030.
