Free up Asean skies!

Singapore Airlines (SIA) and Malaysia Airlines (MAS) are not about to slash fares anytime soon for the popular Singapore-KL sector despite the recent entry of budget airlines, according to The Straits Times tonight.

Competition has had minimal impact on yields and traffic, ST cited SIA chief executive officer Chew Choon Seng and MAS head Idris Jala as telling reporters on Monday on the sidelines of the inaugural Singapore Airshow Aviation Leadership Summit.

The report added that it took six years of lobbying for governments on both sides of the Causeway to clear the runway for a total of four budget flights a day between Singapore and KL, which Tiger Airways, Jetstar Asia and Malaysia's AirAsia started operating on Feb 1.

Between them, ST said SIA and MAS operate a total of 13 daily flights, offering more than 21,000 round-trip seats a week - four times the capacity of the budget boys.

Well, Sophie's World has a simple solution: Time to free up the KL-Singapore air sector completely, instead of waiting for the Asean Open Skies pact to take effect by the end of this year.

There is still a massive bottleneck for long-suffering travelers between the two countries.

S'pore-KL budget flights take off but...

The long-protected Singapore-KL air route has finally been opened up, slightly.

Singapore and Malaysia newspapers highlighted the historic entry of budget airlines in the air sector between Singapore and Kuala Lumpur on Feb 1. Three new players -- Malaysia's AirAsia, and Tiger Airways and Jetstar Asia of Singapore -- will operate a total of four flights a day. Most of the flights will still be dominated by the expensive Singapore Airlines and Malaysia Airlines.

Sophie's World has long argued for the liberalisation of the route, which was dominated by the national carriers of Malaysia and Singapore for the past three decades. It just didn't make sense to shield the two national carriers from the new kids on the block since budget airlines came into play in 2003.

Passengers and commentators will continue to analyse the situation and applaud the move as another step towards open skies in Asean. Sophie's World fully endorses Asean's Open Sky pact by the end of this year to hasten economic and social integration of the region with over 500 million people -- more than one-third the population of China, which is the world's most populous country.

But an open sky pact alone will not nudge the region's disparate economies towards greater integration as long as many countries remain highly nationalistic.

In the case of closely-knit Malaysia and Singapore, the long-term solution is not more flights alone as many people still won't be able to travel freely. Why? This is because air travel is still relatively expensive due to the litany of taxes imposed, and the subsequent connection cost to the city.

For example, The Straits Times highlighted the family of 21 who collectively spent S$3,200 on the maiden budget flight from Singapore to KL. It's a lot cheaper than the S$8,800 they would have forked out on either Singapore Airlines or Malaysia Airlines for the same round-trip flight. At S$3,200, it works out to S$152 per person for a round-trip fare, including all the taxes.

The family could have chartered an entire van or bus for far less and used it to ferry them around in KL for one week. But bus was not an option for them as they said they had some toddlers who couldn't stomach the bus journey to KL. That's not the point here.

The point is at S$152 per person (some budget tickets were given away for free as part of the maiden flight promotions), it is still a high price to travel 320km from Singapore to KL. Budget airfare, inclusive of taxes and surcharges, is still at least 50 percent higher than what many luxury coaches charge between the two cities. In fact, ST said many people paid under S$200 each for a budget airline seat. This is more than double the return bus fare of S$92 charged by luxury coach Aeroline.

The long-term solution to facilitate the extremely high traffic volume between the two capitals is a high-speed bullet train service. It's an idea that was mooted by several Malaysian businessmen in the 1990s and revived recently by Francis Yeoh.

Even former Malaysian Prime Minister Dr Mahathir Mohamad had pushed for the idea as a way to further integrate the two countries. As part of the fast train service between KL and Singapore, Dr Mahathir had proposed a rail tunnel under the narrow Straits of Johor, which separates Malaysia and Singapore.

The rail tunnel project was part of the transportation blueprint in the southern Malaysian city of Johor Baru that involved building a new overhead bridge to replace the old causeway, which connects the two countries.

Although Singapore had officially welcomed the rail tunnel idea, negotiation to build a new overhead bridge was almost stillborn from the beginning. Malaysia finally called off the bridge project two years ago as Singapore had made certain demands -- the right to use Malaysia's airspace and buy sand for its land reclamation -- that Malaysia could not fulfill.

Francis Yeoh appears to be still keen to push ahead with the bullet train project although the rail tunnel and bridge components have been derailed. He could build a new fast rail link to Singapore should Malaysia secure Singapore's blessing, or end the rail track in the city of JB.

The answers are still hazy.

What is clearer is that a fast train service could zip from Singapore to the heart of KL in just 90 minutes -- half the time needed to drive on Malaysia's North-South Expressway. The point-to-point travel will be even faster than air travel due to time needed for airport immigration clearance, baggage clearance and the 57-km road or rail connection between the Kuala Lumpur International Airport and the capital.

Of course, demand will hinge on the eventual price of a train ticket. Sophie's World is hopeful that the price ticket for a fast train service, should it materialise, will be competitive compared to full-fledged airlines or even budget airlines.

But planners in Singapore and Malaysia must not ignore the ultimate bottleneck for road and rail travelers between the two countries -- the jointly-owned causeway.

Can everyone fly KL-Singapore? Part 2

IT's finally confirmed that Malaysia and Singapore will open up the long-protected Singapore-Kuala Lumpur air route to limited service by budget airlines.

According to The Straits Times, from Feb 1, at least one low-cost carrier from each side will be allowed to operate two daily flights - a total of four extra services a day.

The report said all restrictions on the lucrative sector will be lifted on Dec 1, 2008, to allow airlines on both sides of the Causeway to fly as often as they want between the two points. ST added that the liberalisation of one of Asia's most restricted air routes is in line with an Asean initiative to free up air links between capital cities of the 10-member bloc by December next year.

It's definitely a step in the right direction but will it make much of a difference to many long-suffering travelers of Singapore and Malaysia? For air travelers, they will see lower fare but will the cost saving be significant to the bulk of the passengers?

Budget airlines -- AirAsia of Malaysia and Tiger Airways of Singapore -- will put pressure on the national carriers but the bulk of the air rights are still lodged with the national carriers until the end of next year.

The provision for budget airlines of 16 daily flights a day represents 8 per cent of the current total number of flights between Kuala Lumpur and Singapore a week. According to the news report, Singapore Airlines and Malaysia Airlines operate about 85 per cent of the over 200 flights a week, charging about S$400 for a return flight that lasts 45 minutes each way.

As pointed out by Sophie's World earlier, what's more important is the fall in the average airfare for the sector, not the headline-grabbing lowest fare for a few early birds.

Can everyone fly KL-Singapore?

In a surprise development late last week, Malaysia and Singapore agreed to pry open the long-protected air route between the capitals of the two neighbours to limited service by budget airlines.

The limited liberalisation came slightly earlier than expected as the two governments recently signed a pact to exclude the sector from the Competition Act despite the obvious anti-competitive nature of the move. But the opening of the sector will have to take place anyway by next year as part of the Asean open skies pact, as mentioned by Sophie's World earlier.

But will it result in an overnight plunge in the airfare for the sector, which has been monopolised by Singapore Airlines and Malaysia Airlines for the last three decades?

The liberalisation, albeit limited, will definitely put downward pressure on airfare for the Kuala Lumpur-Singapore route.

It won't be difficult for AirAsia of Malaysia and Tiger Airways of Singapore -- the two budget airlines that will start flying the KL-Singapore route in January next year -- to undercut the two national airlines. The two national airlines had fixed the fare for shuttle flights at more than S$300 for a round-trip ticket.

But can the two no-frills players charge airfare that will be substantially cheaper than trains (er, don't bother unless you want to travel at a snail pace) and buses (ranging from S$50 to S$100 for a return ticket)?

Yes, but the cheap airfare may be set aside for a few seats in each flight. What's more important is the fall in the average airfare for the sector, not the headline-grabbing lowest fare for a few early birds.