Senai Airport seeks complementary role to Singapore’s Changi International Airport
So as not to create the impression that it was trying to take away business from neighboring Singapore’s Changi International Airport, the much-smaller Senai Airport in the Malaysian state of Johor, is trying to play down any speculation about its ambitions.
“Senai Airport is a much smaller airport with a smaller radius compared to Singapore’s Changi International Airport which has developed into a class of its own. While Changi is, no doubt, a popular international airport, as a regional hub it is congested both in terms of air and land space. Johor region, on the other hand, is the epicenter of the growth momentum in the Southeast Asia region,” Safuan Basir, Senai Airport’s deputy chief executive told the American Journal of Transportation.
Safuan said that Senai Airport offered “great aviation-driven opportunities” that have come about after the global economic downturn of recent years. The Asia Pacific region, driven by the two giants China and India, would grow stronger than the overall global growth. Two of the low-cost carriers Lion Air (Indonesia) and AirAsia (Malaysia) have made huge aircraft purchases. “To deploy these aircraft, you also need a viable airport which provides excellent regional connectivity,” he added.
“We have invested RM 500 million (RM 3.15 = US$ 1) during the first ten years of our concession which is for a total of 50 years, with 40 years still to go. This money is being used for the runway, the terminal building, cargo complex and the free zone industrial area which, incidentally, has been already completed,” he said.
The airport’s current annual capacity is for three million passengers; the airport clocked some two million passengers in 2013, posting a 43% growth over 2012. Senai is used by all the Malaysian carriers such as AirAsia, Firefly, Malindo and Malaysian Airline (MAS). It operates international flights, mainly, to Indonesia; Thailand is also being added to its network of destinations in the latter part of the year.
The airport handled a cargo volume of 3,100 tons in 2013, up from 3,000 tons in 2012. The cargo traffic, according to Safuan, was evenly split between inbound and outbound traffic; the airport does not receive any freighters; cargo is transported in the aircraft belly. Some 60% of the inbound cargo consists of seafood, mainly, from Borneo, which is meant for local and Singaporean importers.
On the other hand, the biggest export segment comprises general cargo, including oil and gas equipment. Oil and gas pipe shipments have been growing since 2012.
“To increase our cargo traffic, we are investing in improving our facilities by building cold storage, warehousing, etc. We don’t want to be a generalist but want to specialize in certain segments such as perishables, oil and gas equipment, etc.,” he said.
The Changi-Senai relationship is often compared to that of Frankfurt International Airport and Frankfurt-Hahn airport; the latter, a much smaller airport, has evolved into a complementary cargo airport to the much larger Frankfurt International Airport. Indeed, Senai is often referred to as “Malaysia’s Hahn airport”.
“To be honest, we do not and cannot compete with Changi. Competition is not practical for us but together we can generate synergies and support cargo growth in the region,” he explained.
Changi’s air space is more conducive to operating long-haul flights while Senai is better suited for smaller airlines. Senai also plans to introduce a bus service to Changi to push traffic to and from Singapore. “We need to simplify paperwork and customs formalities to push cargo traffic. We are working on this. We want to become a hub and create a niche to attract freighters,” Safuan said.
The contours of the much-publicized concept of Iskandar’s Aviation Park are, meanwhile, taking concrete shape; with phase 1 (the hangar development) completed, phase 2 is also getting a forward push but the contract still needs to be finalized because many of the customers are foreigners whose leasing agreement needs to be finalized.
“We are interested in getting clients for manufacturing. Companies from Canada and Japan are already present here. Hershey, the U.S. chocolate company, is building here the biggest plant in Asia with an investment estimated at RM 800 million,” Safuan said.
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