MAHB resolves to improve infrastructure, services as MD admits it might have been 'slow' to respond to passenger needs

KUALA LUMPUR (April 27): Malaysia Airports Holdings Bhd's managing director Datuk Iskandar Mizal Mahmood admitted that the airport operator might have been "a bit slow" in keeping up with the evolving needs of passengers, but said the group is now embarking on a transformation exercise to lift its network of airports back to the top tier of global rankings.

He said this in a statement Thursday (April 27), in which MAHB shared that the positive momentum seen in the recovery of passenger movements at its network of airports is expected to continue in 2023 and 2024.

The group said it is resolved to improve its infrastructure and services to further increase passenger traffic.

“MAHB is embarking on a transformation exercise involving its service delivery and infrastructure. This is critical in delivering the goal of bringing its airports, especially KLIA, back on the top tier global rankings.

"Several operational improvements to achieve enhanced service delivery are being undertaken including ambience improvement, self-service check-in and bag drop, digital solutions and many more,” said Iskandar.

The initiatives will be rolled out in stages to keep up with the needs of travellers, said MAHB, who recently announced the "much-needed" ageing critical asset replacement programme such as KLIA's Aerotrain system and baggage handling system. The replacement of these critical assets, according to MAHB, will be completed within the next two years.

The announcement came after the airport operator came under fire when its 25-year-old Aerotrain service broke down on March 1 due to mechanical and electronic failures, which resulted in 114 passengers being stranded mid-way on the tracks, which run between KLIA's main terminal building and its satellite building. During the incident, a second train dispatched to transport the stranded passengers also failed. The Aerotrain service has now been suspended until further notice.

"We may have been a bit slow in keeping up with the evolving needs of the passengers, but we are geared up to implement these initiatives and deliver better services," Iskandar said.

MAHB, which plans to roll out these initiatives in stages, is also positioning itself to be an integral part of Malaysia's economic machinery in bringing in tourism dollars into the country.

“China has proven to be a strong market for Malaysia’s tourism initiatives in the years prior to the Covid-19 pandemic. We are focusing on this proven market to capitalise on the potential and grow it further. However, we need to be strategic and smart in targeting China as every country in this region is chasing after that market. We need an effective platform not only to shout-out Malaysia’s offerings, but also provide most of the travel and leisure services fulfilment,” said Iskandar.

MAHB is in the midst of finalising "several such initiatives to establish exactly this", including a digital super application with an existing subscriber base of over a billion users.

“Such initiatives are carefully identified and chosen to maximise impact given that time is of the essence. And of course, being a public-listed company, MAHB has to run the process through its governance structure and appropriate requisite approvals by the Board. As a business entity, MAHB will focus on high impact initiatives," said Iskandar.

Speed to market is an important criteria, he noted, adding smart initiatives with established players will ensure minimal or no investment requirement from MAHB, hence ensuring maximum returns and more importantly, delivering results of bringing in tourism dollars into Malaysia.

“MAHB is excited about these transformational initiatives. We are committed to making our airports relevant and playing a pivotal role in contributing towards Malaysia’s growth,” he added.

For the first quarter of 2023 (1QFY2023), MAHB'S domestic passenger movements reached 81.2% of 2019's level, while its international passenger movements were at 78.4% of 2019's.

MAHB shares closed five sen or 0.7% higher at RM7.15, giving the group a market capitalisation of RM11.86 billion.