Maybank: Malaysia’s aviation industry bogged down by inherent weaknesses

Maybank: Malaysia’s aviation industry bogged down by inherent weaknesses

KUALA LUMPUR: The US Federal Aviation Administration’s (FAA) move to downgrade Malaysia’s air safety rating is something that many industry professionals and academians have forewarned amid many of the inherent weakness, the Maybank IB Research revealed today.

According to an analyst Mohsin Aziz’s insufficient new staff, poor staff retention, underpaid, infrastructure need and outstanding audit follow-up are among the weaknesses.

Aziz said the process of training a qualified civil aviation professional which takes about eight to 12 years is the normal period and very often, the individual loses interest and decides to leave halfway.

“Worse, the moment staff is deemed qualified, they are quickly poached by other countries,” he said in a research note following news that the FAA has downgraded Malaysia to Category 2 on safety concerns which could result in Malaysia’s carriers not being able to open new routes to the US.

On infrastructure needs, he said the level of aviation infrastructure in Malaysia is mixed, with busy airports and flight paths equipped with state-of-the-art infrastructure but for the less busy routes, however, it is still using rather dated infrastructure.

“While this makes financial sense and has no implication on safety, it bogs down the efficiency of the entire system. It is pointless to provide Kuala Lumpur with the best system as it will be constrained by the ‘inferior’ system outside of the capital city. In this industry, you are only as good as your weakest link.”

He claimed that the Civil Aviation Authority of Malaysia (CAAM) has also missed audits or been slow to follow-up after existing audits, which can be attributed to the lack of manpower as CAAM needs to prioritise the more pressing tasks.

CAAM has requested the FAA to conduct a reassessment within the next 12 months to restore its Category 1 Aviation Regulator status.

However, Mohsin thinks it would take two years at best to get back to the Category 1 status as a follow-up audit will be determined and scheduled by the FAA and not by Malaysia.

In the meantime, some of the possible impacts are that the public perception of the safety of Malaysia’s carriers turns negative, Malaysian pilots and engineers are not employable outside Malaysia and a loss of maintenance, repair and overhaul business, he outlined.

Under the International Convention on Civil Aviation (Chicago Convention), each country is responsible for the safety oversight of its own air carriers.

Other countries can only conduct specific surveillance activities, principally involving the inspection of required documents and the physical condition of aircraft. This means Country A can conduct an audit on Country B, assuming there are commercial flights between the two countries.

FAA conducts the International Aviation Safety Assessment Programme, assessing the Civil Aviation Authority of each country that has carriers operating to the US.

Malaysia has always been renowned as tier-1 status for aviation standards.

At 12.30 pm, Malaysia Airports Holdings Bhd’s (MAHB) shares on Bursa Malaysia dropped 16 sen to RM8.19 with 1.49 million shares traded, AirAsia inched down one sen to RM1.92 and AirAsia X edged up one sen to 17.5 sen, with 1.73 million shares and 32.01 million shares changing hands, respectively.

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