SHORT-HAUL carrier Firefly is expected to lose up to RM20 million a month from the suspension of its direct flights into Singapore following the airspace impasse between Malaysia and Singapore, said Malaysia Airlines Group (MAG) chief executive officer Izham Ismail.

Beginning from December 1, Firefly was forced to stop its flights from Subang to Singapore, its second biggest route after Penang, after the Civil Aviation Authority of Malaysia (CAAM) did not approve its move to Seletar airport.

The suspension has caused a “huge dent” in MAG, in which Firefly is a subsidiary, said Izham.

“The exposure, the revenue lost (from the suspension) is RM15 million, so we’re looking at RM15 million to RM20 million revenue lost on a monthly basis,” Izham told The Malaysian Insight.

“Firefly has been doing well over the past three years, so this is a huge dent to the group.”

Firefly was operating 20 daily turboprop flights – to and from Subang, Ipoh and Kuantan – at Changi airport before December 1.

Singapore recently shifted turboprop planes to its newly renovated Seletar airport amid its plan to expand operations there. Firefly was to have been the first commercial airline to land there.

But on October 26 last year, Izham said the group submitted its operations specifications report for approval to CAAM and was shocked to hear from the civil aviation authorities that Seletar’s new instrument-landing system (ILS) had not been published and approved by both countries.

Malaysian authorities did not approve the landing system on the grounds that it will restrict development and shipping operations in Malaysia’s Pasir Gudang port.

As a result, the airline was not given the approval to fly into Seletar and at around the same time, Izham said, he was informed that Changi airport had sold Firefly’s slots, leaving it without landing rights in the island republic.

“We were forced to bite the bullet, cancel the flights and reimburse our passengers,” he said.

“This has caused a huge dent to our subsidiary, which has affected the whole group. We need a resolution very quickly.”

Izham said the ensuing discussions between MAG, Malaysia’s Transport Ministry officials and their Singapore counterparts “did not go anywhere” for the whole of December until Tuesday’s meeting between foreign affairs ministers of both countries.

Foreign Affairs Minister Saifuddin Abdullah and his Singaporean counterpart, Vivian Balakrishnan, issued a press statement following their meeting, announcing the suspension of the ILS and Malaysia’s permanent restriction of airspace over Pasir Gudang for a period of one month.

The outcome, said Izham, is welcome news for the airline and for all related parties which have been indirectly affected by the impasse.

After Tuesday’s meeting, Firefly’s newly appointed chief executive officer Philip See said he sent a letter to the Changi Airport Group (CAG) on Wednesday to repeat its request for the airline to be given back its landing slots.

“The tone set by the leadership has been one on diplomacy,” said See, referring to the ministerial meeting in Singapore.

“We also want to approach a more diplomatic stance and really just politely ask Singapore airport and say, ‘look, in view that we don’t have the infrastructure fully endorsed, the government has already removed the approval of the ILS, please accede to our request and release temporarily the landing slots in Changi’,” he told The Malaysian Insight.

Changi has submitted its request to Singapore’s civil aviation authorities for consideration and remains cautiously optimistic of a positive response, See said.

Izham said while Malaysia managed the issue well, with the government being both “diplomatic and assertive”, as a business, it has to do more to try and end the impasse.

“Our planes are assets costing a few hundred million ringgit,” he said, referring to Firefly’s fleet of 13 planes.

“If we put them on the ground, they are not going to make money. We need them to fly.” – January 11, 2019.