19 June 2013
The opening of a new airport to accommodate budget carriers has been delayed until next year because of design changes and other construction setbacks, Malaysia’s airport operator says.
Malaysia Airport Holdings Berhad said late Tuesday that the contractors for the terminal building of the new airport, who previously said the facility would be completed this month, need additional time and set late April 2014 as a new target date for completion. Operations are to start on May 2, 2014.
The 4 billion ringgit ($1.27 billion) airport, dubbed klia2, was originally slated to open in mid-2012 but was delayed due to design changes. The contractors also have blamed poor ground conditions for the delay.
Malaysia Airports has said 90 percent of the project is complete and that costs haven’t risen despite the delay.
The project cost doubled from an earlier estimate of 2 billion ringgit ($631 million) in 2011, after Malaysia Airports scaled up the design to increase capacity to 45 million passengers annually, up from 30 million. That will make klia2 the biggest low-cost airport in the world. It also included plans for aerobridges, automated baggage handling systems and a huge retail space.
AirAsia, Southeast Asia’s top budget carrier and the main user of the terminal, has criticized the multiple delays and the higher expense.
Aireen Omar, head of its Malaysian operations, said earlier this month that what was meant to be a simple low-cost airport has developed into a "vast and highly complex infrastructure." AirAsia is worried the high project cost will mean high landing fees that will hurt its operations.
Aireen called for an investigation into the delay, saying it was puzzling as Malaysia Airports in January announced the project was ahead of time and would be completed by June 28.
Malaysia Airports has said it was in talks with AirAsia and other low-cost operators to address congestion at the existing low-cost terminal, which can handle 15 million people a year. It said measures include allowing airlines to use the main international airport if needed.
Malaysia hopes the new budget airport will bolster the country’s international airport as a significant air hub in the region, rivaling Singapore’s Changi Airport and Thailand’s Suvarnabhumi Airport.
Malaysia’s international airport and its current low-cost terminal handled nearly 40 million passengers last year, close to its capacity due to high traffic at its budget terminal.
In comparison, Changi’s three main terminals have a combined capacity of 66 million passengers and handled 51 million people last year. Suvarnabhumi, which opened in late 2006, handled similar number of passengers last year.
With the proliferation of low-cost airlines in the region, Singapore is upgrading its budget terminal to double capacity to 16 million people and will reopen in 2017. Singapore is also building a fifth terminal that will bring its total capacity to more than 85 million passengers by 2023.
Source: www.businessweek.com
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