Matta calls for moratorium of fee hike until market conditions are further strengthened

Published on : Friday, April 8, 2016

3Malaysian Association of Tour and Travel Agents  President Datuk Hj Hamzah Rahmat is alarmed over the huge increase in fees imposed by the Department of Civil Aviation (DCA) to airlines from April 15. Hamzah said “The timing is just not right as the market is still soft. Last year, there were 1,716,064 fewer visitors compared to the previous year. Our target of attracting 30.5 million visitors this year may be derailed if air ticket prices go up and the number of flights goes down.”


“The DCA should accord greater priority to our nation’s interest than in its own revenue.Moreover, high fees would be a disincentive for airlines to increase frequency and new carriers to come in. In the worst scenario, it can cause existing airlines to pull out of Malaysia.” MATTA inbound vice president Datuk Tan Kok Liang pointed out “The 6.3% drop in visitor arrivals last year meant a loss of RM2,9 billion in tourism receipts. Foreign exchange is crucial in strengthening our weak ringgit. If domestic airfares were to be increased, the people of Sabah and Sarawak will be severely affected as they are dependent on air travel to the peninsular on essential matters such as education, medical treatment, business and employment.


Local tourism will take a big hit as 60 percent of arrivals to these two states are by air. This will not happen if the airlines are prepared to absorb the additional costs but this appears unlikely, as the reaction by Malaysia Airlines Berhad is a good indication.”


MATTA ticketing vice president Puan Zarinah Hashim explained “The price of an air ticket consists of the airfare plus taxes, fees and charges, known as TFC in airline lingo. Even if airfares remain the same, the ticket price can go up with an increase of TFC charges. If there had been no increase since 1970, it does not justify DCA to impose them all at one go. The DCA should treat airlines as customers, engaging with them frequently and if need be, to increase fees on a staggered basis as no industry should be jolted unnecessarily. If there is no moratorium on the fee hike, then airlines would cut down or shelve plans to increase frequency to save cost. It appeared that DCA did not seek the buy-in from airlines and just informed them on April 1 of the increase for the local representatives to relay to their HQ.”


MATTA honorary secretary general Nigel Wing disclosed “Already, many travellers are seeking advice whether they should buy their air tickets now, fearful of a looming price increase, as airlines normally pass any increase in costs to passengers, such as fuel surcharge.



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