MANAGING AIR CARRIERS

      How do the changes in the industry affect shippers who want to use air cargo services? This has be a rapidly growing industry for a few reasons:

• Increased demand for premium service. There is an increasing number of people in the world who can afford the benefits of premium service and want the luxury goods that can afford the benefits of premium service and want the luxury goods that can best be provided by air cargo.

•  Increased service. There has been an overall increase. There has been an overall increase in the flight industry, including many new routes and increased services on routes.

• More competitive service. The business environment is less regulated and more competitive, which translates into reducing costs.

•     Carrier integration. Air cargo carriers, rather than operating independently as airlines used to do, are now part of integrated carriers that increase the value of air cargo services.

Carriers are becoming much more advanced and the range of services has been increasing. The variety of services range from next flight out to next day delivery to the cheapest and slowest service available.  In Hong Kong, one air express company is now using convenience markets to drop off urgent packages where they pickup three times daily.

Shippers make a choice on how to transport cargo, so it is helpful to see how air cargo compares to other modes of transport. Competition among the different modes of transport has caused them to change their operating methods. One reason ships are more schedule conscious is because of competition from air cargo service. This competition between air and sea is not very strong for the simple reason that there is a very large difference in the cost and service provided by the two. Small differences in air cargo rates are not going to have much of an impact on ocean cargo that is only a fraction of the cost. The service provided by ocean carriers could not come close to the speed of air cargo.

There is more competition between air service and trucking service over short distances. As already mentioned, air cargo is sometimes trucked if the distance is not too great, and there are no natural barriers. This is common in the US and Europe. Trains are rarely a viable alternative because their service is too slow and inflexible. Air cargo is seeing some competition from non transportation industries, particularly the fax and internet. These new technologies are the main threat to air express, mail and courier services.

Air cargo carriers can save money in the planes used, and the fleet selected. Older planes can be acquired more cheaply, but use up to 40% more fuel than new models. Having a standardized fleet makes maintenance and personal cheaper. Cargo planes may either be retired passenger planes, or custom designed cargo planes.   

                                              

   

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VESSEL TRAFFIC MOVEMENT

SHIPS are specifically designed and built to move safely through the water while carrying cargo. But when travelling either without cargo or only partially laden, ships must take additional weight on board to enable them to operate effectively and safely. This weight, known as ballast, is crucial to maintain safe operating conditions in shipping voyages as it reduces stress on the hull, provides transverse stability, improves propulsion and manoeuvrability, and compensates for weight lost.

Cross section of a ship showing ballast tanks and ballast water cycle (left). According to the International Maritime Organisation (IMO), the spread of invasive species in ship’s ballast water is largely due to expanding global trade and traffic volumes.

Although essential for shipping operations, ballast water may pose serious ecological, economic and health problems from the multitude of marine organisms/species carried from one port to another. Species that have been moved, intentionally or unintentionally, due to human activity into areas where they do not occur naturally are called ‘introduced species’ or ‘alien species’.

The International Convention for the Control and Management of Ships’ Ballast Water and Sediments (BWM) was adopted at a Diplomatic Conference held at the International Maritime Organisation (IMO) Headquarters in London on 13 February 2004. The Convention will enter into force 12 months after ratification by 30 states with 35 % of world merchant shipping tonnage. As of 31 October 2012, 36 countries representing about 29 % of world tonnage have ratified the Convention. As only about 6 % of world tonnage needed to fulfil these requirements remains, it is envisaged that the Convention would soon come into force. Malaysia ratified the Convention on 27 September 2010.

 With more than 70,000 ships passing through the Straits of Malacca annually making it one of the busiest shipping lanes in the world, the threat of marine environment contamination from ballast water is serious and needs proper management and regulation.

Several strategies have been developed and used globally, often including one or several of the following:

• ·         Minimising uptake of organisms into ballast water tanks by avoiding ballast water uptake in shallow and turbid areas for instance in areas where propellers can stir up sediment, and avoiding uptake at night when many organisms migrate vertically in the water column to feed to reduce the number of organisms that enter ballast water tanks.
• ·         Removing ballast sediment through routine cleaning of ballast water tanks and removal of sediment in mid-ocean or at specific facilities provided at ports to reduce the number of organisms that could potentially be transported.
• ·         Avoiding unnecessary discharge of ballast water. In circumstances where cargo handling demands uptake and discharge of ballast water within a port, water taken up in another area should not be discharged if possible.
• ·         Conducting ballast water exchange either between ports, mid-ocean or in deep water to reduce the risk of invasions.

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RFID Tecnhnology is Important in Logistics

What is RFID?

RFID stands for Radio-Frequency IDentification. The acronym refers to small electronic devices that consist of a small chip and an antenna. The chip typically is capable of carrying 2,000 bytes of data or less.

The RFID device serves the same purpose as a bar code or a magnetic strip on the back of a credit card or ATM card; it provides a unique identifier for that object. And, just as a bar code or magnetic strip must be scanned to get the information, the RFID device must be scanned to retrieve the identifying information.

RFID Works Better Than Barcodes

A significant advantage of RFID devices over the others mentioned above is that the RFID device does not need to be positioned precisely relative to the scanner. We're all familiar with the difficulty that store checkout clerks sometimes have in making sure that a barcode can be read. And obviously, credit cards and ATM cards must be swiped through a special reader.

In contrast, RFID devices will work within a few feet (up to 20 feet for high-frequency devices) of the scanner. For example, you could just put all of your groceries or purchases in a bag, and set the bag on the scanner. It would be able to query all of the RFID devices and total your purchase immediately.

RFID technology has been available for more than fifty years. It has only been recently that the ability to manufacture the RFID devices has fallen to the point where they can be used as a "throwaway" inventory or control device.

One reason that it has taken so long for RFID to come into common use is the lack of standards in the industry. Most companies invested in RFID technology only use the tags to track items within their control, many of the benefits of RFID come when items are tracked from company to company or from country to country. But the company must invest more to use this technology.

The use of RFID in Logistics.

Asset Tracking

There are many RFID manufacturers in the world. One of them is HID Global, a leader in track-and-trace capabilities, produces advanced RFID tags and components essential to optimizing automated asset tracking and logistics systems. RFID help ensure seamless traceability and reduce losses, while enhancing stock management and processing speed. Passive contactless RFID tags improve data collection speed and accuracy, making tracking more cost-effective while increasing accuracy. RFID also offers low frequency, high frequency and with a broad selection of form factors, chip configurations and memory capacities.

Assisting Warehouse Operation

In order to improve productivity and control, warehouses are seriously considering the use of radio frequency identification (FRID) tags for day-to-day operations. This wireless technology increases efficiency of warehouse management because, unlike bar codes which must be scanned manually to feed in the information on the computers, RF tags broadcast a signal with information about the product they are attached to and about the location of the product in the warehouse. RFID technology provides an interesting option to complement data collection and product identification in the supply chain management and warehouse operation.

A wireless warehouse, that uses RFID Technology, works by linking warehouse workers to the back-end warehouse management application server where warehouse activities are being recorded via wireless handheld devices, scanning bar codes or RF tags attached to the pallets. These devices help employees to identify where to pick, put away, count, or move products within the plant. This translates to a better control over the movement and storage of materials within the warehouse by maximizing the efficiency of the receipt and shipment of goods, optimizing warehouse space utilization and knowing at all times exactly where goods are stored, allowing employees to improve and maintain high customer service levels.

Using RFID to identify product

Example of RFID

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DESCRIPTION OF AIRPORTS

     The number of airports is much greater than most people would guess because passengers are familiar to going to their local passenger airport. Almost all major airports are run by a public agency, usually a local government. This is because airports are important to a community and more likely to be a natural monopoly. The many small airports, though more likely to be privately run. There has been talk of privatizing airports to make them operate more efficiently. The best known example is the Malaysia Airports Holdings Bhd that is run by a private company. 


      Airport administrations tend to look like small town.  They have all the departments of a company as well as their own fire and police departments. Airports are usually divided into two areas, called groundside operations and airside operations. The groundside is what the passengers see, including airline arrival and departure areas, public parking, the restaurants and so on. But there is another area, often bigger, the airside. This is where the airlines operate, the baggage is handled and the cargo moved. The airside tends to be invisible to those who do not work in flight.

      Money earned by an airport comes from a variety of sources. The two most important sources are concessions and carrier fees. The carrier fees, the primary source is landing fees. Although a major income area for airports, it is a small part of a carrier’s costs. Concessions are the companies that rent space in and around the aiport to provide goods and services, such as restaurant and gift stores. Even a small booth in a major airport can earn big amounts of money because of its good location. These concessions then pay the airport a percentage of their revenue.

    Carrier fees can be calculated in two ways. First, there is the balance method. An airport calculates its overall expenses, minus non-airline revenue and charges the airlines remaining the costs. The second way to calculate carrier fees is the compensation method. Airlines pay for the parts of the airport they use. They would pay rent for all the space used. Most importantly, landing fees are charged to the airlines every time a plane lands at the airport.

  Capital improvements to airports can be paid for either by selling bonds or special taxes. Passengers are often charged a fee for arrival or departure. This is usually overseen by the federal authorities because they do not want airports to create special costs for entering or exiting a country that would affect international relations.

   Airport capacity refers to the amount of passengers and cargo that can move through an airport. It is determined by the runway, terminals and facilities and is one of the most critical issues for airports today. Groundsides capacity refers to the number of passengers or cargo that can get to the airport, including parking space. Airside capacity refers to the number of planes that can be handled, including the number of planes that can arrive and take off in a certain period of time. Runway capacity is based on air traffic control, demand, weather, design and configuration of runways.


                                      

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HISTORY OF LOGISTICS AND TRANSPORTATION

      Logistics was originally a military term, because it is a key of factor in the success or failure wars. In fact, many military experts would say that logistics is the key to winning a war. Historically, logistics has been a leading factor in the success or failure of many military conflicts. Transportation gave countries ability to project power domestically, regionally and globally. It was strong the economy by promoting trade that further improved the military powers. Chinese Emperors sent their aircraft throughout Asia to intimidate neighboring countries and appreciate demand.

      Admiral Alfred T. Mahan wrote a famous book, The Influence of sea Power Upon History, 1660-1738 in 1890, that influenced President Theodore Roosevelt to make the US a world naval power. If logistics is a critical part of military operations, it is just as important to many companies. In recent decades logistics has become an important part of business success, and that is the emphasis in this book. It is important to recognize, thought that logistics is done by public and private sector organizations and the ideas are still basically the same. Some of the techniques are different depending on the needs of the organization, but the differences are quite small. Military logistics emphasize quick response and the flexibility to adapt to changing situations. Many businesses work in environment where quick response and flexibility are important for commercial success.

     Logistics was not always a recognized field of study or a career. In a classic book from 1915, the only two functions of marketing were demand creation and physical supply. There were three reasons integrated logistics did not come about at first:

      1)     There was no role for computers seen in integrating functional areas.

      2)      Volatile economic conditions led management to concentrate on cost containment.

      3)     There was difficulty in quantifying the returns that could be gained.

Since then, a variety of things have changed to the point where logistics is now a well-recognized and valuable part of the company. Why did things change? A few reasons can be identified:

Computerization- having the ability to manage vast amounts of information is vital to many logistics function. The problems were simply too complex and there was a limit to the level of advanced.

Quality management- Companies have been looking at ways to improve their operations, and recognized that logistics was one area that had been historically to looked.

Partnership and alliances- There has been a trend for companies to work closer with their supplier, customers and others partners to improve efficiency.

Deregulation- Certain key parts of the logistics profession were heavily regulated, which prevented them from involve in close cooperation with their customers. This included railroads, ocean shippers and airlines.

     Changes in transportation have played a mixed role in the development of the logistics field. It is important not to mistake the changes in the transportation industry for the demand of the trading public that is driving those changes. Ships, trucks and trains have seen little changes in how they operate over the past several decades. However, the major changes in transportation came not from the transport itself but its role in the larger logistics and business practices. The different modes of transport now work together. It is call intermodalism.

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MANAGING INTERMODAL TRANSPORT

        The most transportation aspect of intermodalism is not the equipment, but the operating and management issues. Traditionally, a carrier operated as an independent company. The shipping company worried about shipping, the trucking company worried about trucking, and so on. Intermodalism requires the coordination of multiple carriers. Sometimes these are the same company, but usually they are independent or at least different subsidiaries in the same company.

    Why is this important? Intermodalism requires cooperation and coordination among a variety group of companies on a level that is seldom seen in other industries. We know how difficult can be to run any organization. Running an organization in close cooperation with many others, to the point where every one of hundreds of shipments needs to be coordinated, is quite a task. Also, the different companies are often very different in organization, structure, and culture.

     What are intermodal companies? Sometimes they are asset-based carriers, such as a shipping company that expands into providing intermodal service. This is common for containerized shipping companies, which are mostly carrying cargo that would only move intermodally.  Railroad and trucking companies sometimes provide intermodal service, but it is not so critical for them. Then there are companies that do not control any assets, but only provide intermodal services. They coordinate shipments between the other carriers. Sometimes this is done by buying up space on the other carriers at a wholesale rate.

     One distinctive thing about intermodal carriers is their advance information system. They need to process a lot of information, under time pressure and in coordination with other carriers. This means that information systems tend to be exceptionally important.

        Trucking, rail and to a lesser extent inland shipping are important to intermodal shipments. However, many international shipments go overland that are not intermodal, or they may be containerized but only use one mode of transport. The overland transport is used to link the line haul, such as ocean ship, to the origin or destination.

The Intermodal Move

How exactly does an intermodal shipment work? The shipper decides what size container is needed, and orders it from the carrier. A container is delivered to the customer’s location, and left there for a designated amount of time to be loaded (usually around 24 hours). The container is most likely brought on truck, but very large shippers may have their own rail head where containers are picked straight off train.

   The truck (or train) comes back at the appointed time and takes the container away. It then goes on its journey. At the final destination, it is usually delivered to a building (again, usually by truck but some facilities have their own train platforms), where it is left for a designated amount of time to be unloaded. The container is later picked up and taken to its next customer.

                                    

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INTERMODAL TRANSPORTATION AND CONTAINERAZATION

1. The Nature of Intermodalism

All modes look the other way as its competitors, and have seen the level of suspicion and mistrust. Carriers are trying to retain business and increase revenue by maximizing the distance line under their control. Each mode, especially airlines that operate them, has sought to exploit its own advantages in terms of cost, service, reliability and safety.

Intermodal transportation. Movement of passengers or goods from one mode of transport to another, usually occur at specific terminals for any purpose. In North America, intermodal term is also used to refer to the container rail transport.

Sending all transportation. Movement of passengers or freight transport in the same way. Although "pure" diffusion transport rarely exists and intermodal operations often required (eg: ship to the dockside to ship ) , the aim is to ensure continuity in the same public transport network .

2. Intermodalism form

Intermodalism emergence was brought in part by technology and the need for transportation management units such as containers, swap bodies, pallets or semi -trailer. In the past , the palette is a common management unit , but its relatively small size and lack of a protective frame made ​​their intermodal handling labor -intensive and vulnerable to damage or theft. Techniques and better management unit to transfer goods from one mode to another has facilitated exchanges between modes. An early example of piggyback (TOFC: Trailers on Flat Car ) , in which trailer truck parked on the train, and hit (a lighter on board), where river barges placed directly on board the ship sea .

3. Containerization

Container. A metal box the size of a large standard into a full cargo for shipment aboard specially configured mode of transport. It is designed to move with the normal operation of equipment enabling high-speed inter-modal transfer in large economic units between ships, railcars, truck chassis, and barges using a minimum of labor. The former, therefore, serves as a unit instead of load cargo contained therein. The size of the box reference is 20 feet , 20 feet long , 8'6 " feet tall and 8 feet wide, or 1Twenty foot Equivalent Units ( TEUs ) . Since most of the former is now forty feet long, term Forty foot Equivalent Unit (FEU) is also used , but are less common .

Containerization . Referring to the increasing use of general and container as support for freight transportation. It involves a process in which intermodal containers that are increasingly used because it is either a replacement cargo from another vehicle, received in support of the distribution of goods or modes absorb more space transportation system is able to handle containers.

4. Advantages and Challenges of Containerization

• Warehouse. Former limit the risk of damage to goods it brings because it is resistant to shocks and weather conditions. Packaging products containing Therefore, it is easier, cheaper and can occupy less volume. This will reduce the cost of insurance since the cargo is less susceptible to damage during transport. In addition, the former fit together to allow stacking on board, the train (doubles tacking ) and on the ground. It is possible to superimpose three and six empty containers loaded on the ground. The former is a consequence warehouse itself.

• Security. Contents of the container are anonymous to outsiders because it can only be opened at the origin, the customs and the destination. Grazing, especially precious commodity, thus substantially reduced, resulting in lower insurance premiums. Theft is a serious issue in port before containerization as longshoremen have ready access to cargo.

benefits of containerization

containers stacked ships

containers tacking

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Importance of Shipping Industry In Malaysia

Nowadays, shipping industries in Malaysia is more demanding for the use in shipment of local and international. The shipping industry is expected to remain strong year by year. It supported by high demand for small and medium sized ships, balancing of the decline in orders for tankers and container vessels. Medium sized ships are now increasingly in demand, particularly from the oil and gas industry. For example, the Economic Transformation Programme (ETP), Petronas were using the medium sized ships for finding deep sea oils and those that are marginal oil fields within the waters of the country. They need more complex medium sized ships which are capable of manufacturing at local shipyards.

Other than that, shipping transport 90 percent of global trade in the market. Many of the company take the opportunity in shipping industry because shipping holds economic and environmental advantage over other modes of transport. Depend on the ocean shipping is expected to rise with increasingly trade volume. Water transportation is a key of Malaysia’s trade oriented economy. Consignor and consignee usually choose this water transport usually based on the cost that is offer by the shipping company is cheaper than other mode of transport.

The rise of shipping company will increase more job opportunity for young Malaysian’s student that past graduate. This is to avoid from our fresh graduate student unemployed. We can see that the number of shipping company keep increasing from time to time. It can help our Malaysian’s people grab the job in the shipping industry. It is the best if the owner and the workers of the shipping company are from our own country Malaysia, rather than owned by foreigner. It is not too bad for having a foreigner to invest in the shipping company in Malaysia, but priority of Malaysian people is more important. Besides that, this matter can give opportunity to the Malaysian people to invest in shipping company. Furthermore, it will attract more investor from the international to invest in our company in Malaysia. In this matter, it can develop our Malaysia ahead of others.

Our ports in Malaysia were very popular with the busiest port in Asia and International. Our ports such as East Port and West Port were in the top list of busiest port in the world. It is because of our country is located on world trade way. In this matter, shipping industry must play a role in generating economic to develop this place. Government in Malaysia open a place near to the port is for the shipping company open up their business. This will give a win-win situation for the government and the shipping company. Government will get the income from the investors that build their company on the government place in term of taxation, and the shipping company can get opportunity to open their business.

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REVOLUTION IN TRANSPORTATION

IN many ways, innovations are happening in the transportation sector to such an extent that a revolution is evidently taking place. Transport is no more merely moving people and goods from one place to another. Transportation in the early 21st Century requires us to be very conscious of complexity on many dimensions. In this century, transportation has become complex because of the many variables, namely socio-technical matters in particular, environmental concerns.

 

We need to be concerned with noise and air pollution. The government needs to allow for the growth of the transportation sectors and consequently produce policies to improve the well beings of those who live in urban areas facing the heavy traffic daily. Passenger and commercial vehicles will continue to increase in tandem with the increase in population, thus what is needed is a policy allowing for growth with reduced environmental impacts.

 Learning from Nature for Noise Problem

The Shinkansen Bullet Train of the West Japan Railway Company is the fastest train in the world, travelling 200 m.p.h. The problem is the noise. Air pressure changes produced large thunder claps every time the train emerged from a tunnel, causing residents 500 m away to complain.

Eiji Nakatsu, the train’s chief engineer modeled the front-end of the train after the beak of king­ shers, which dive from the air into bodies of water with very little splash to catch fish, resulted not only in a quieter train, but also reduced the electricity consumption by 15% even while the train is speeding 10% faster.

Transportation has to respond to major environmental concerns in particular air pollution as well. If Malaysia is to reduce carbon footprint by 40% by 2020, a relook at the transportation sector is needed. It seems that a major portion of CO2 emission is due to vehicles. A green revolution in transportation is indeed imminent.

The growth of the transportation industry in particular, the  heavy goods vehicles (HGV) which uses diesel engines has lead to the increase in emission of green house gases (GHG), in particular carbon dioxide and carbon monoxide. Transportation has contributed signi­ cantly to these gases which contribute to climate change caused by the increase in temperature worldwide.

A slight increase in temperature may cause signi­ficant climate change because it involves the mass of air over the globe rather than mass of air in a room. An increase in temperature causes an increase in sea levels worldwide and a reduction of crop productivity.

There are many ways to reduce air pollution and some are already taking place. Reduction in traffic congestion can be achieved by having smart partnership between the road and railways. By taking lorries off the roads, it not only reduces air pollution but also accidents.

Public transportation which is already in place should be improved. Using an alternative mode like bicycling will help to mitigate the problem of congestion. Infrastructure for public use of bicycles is to be provided so that it will encourage the use of such practices.

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ESSENTIAL AIRLINE MARKETING STRATEGIES

The concept of marketing can be quite confusing to those who are unfamiliar with business, management, and economies. They might wonder: what is the different between marketing and sales? Is there anything else that marketing can do other than advertise? Why and in what way is marketing related to economies? Marketing researchers have analyzed these important issues in great detail over the past 50 years. 

1) Market segmentation and product differentiation

Why do airlines need different classes such as first class and business class? whydo airlines images differ? does it matter if airlines do not segment? what if the target market is shared with competitors? the art of market segmentation and product differentiation is introduced. Airlines constantly use these skills, which form the core elements of their product strategy.  the answer to all question above involves product strategies. Different types of customers exist: some rich , some are not. Some passengers' travel costs are reimbursed by taxpayers and their bosses, while other passengers pay for their own tickets. Some passengers travel for business, while others travel for leisure only. Wealthy customers might be willing to pay more to get a larger and more private seat during their flight for added comfort and privacy: these passengers are what the airlines call business travelers, but not all business travelers fly business class. Some airlines focus on the higher-end markets: business and first class travelers.The cabin interior of the legendary supersonic Concorde is an excellent example thereof. This famous and luxury aircraft was equipped with first and business class only. Normally, in order to attract business and first class passengers, airlines need to offer dedicated check-in counters, as well as finely decorated lounge facilities, complete food, beverages, and newspapers. However, if the market size of these well-off passengers is not big enough, it may prove too costly to run these facilities.

2) Airline marketing strategies- what you really need to know

Most people have already read plenty of marketing ideas and have learned basic marketing concepts from newspapers columns and business magazines, but what is the entire picture of marketing? The most important and basic elements of marketing are introduced. Readers will understand the role that marketing plays, and will then be ready for advanced marketing knowledge. Airline marketing is just like regular marketing, but marketers are marketing airlines services. The first thing everyone needs to know is that professionals usually divide marketing strategies into four categories: Product, Price ,Place and Promotion. That is 4P's. It is still from the bedrock of most marketing plans that marketers draw up, meaning that when people talk about marketing strategies, they base many of their decisions on these four categories. Any marketer  should know what the 4P's mean in his or her specific field. To the airline marketer, product means the delivery of  services to airline's customers, price means the fare that airlines charge their customers for the service. Sometimes price also refers to total costs, which includes searching, handling, and delivery costs. This definition leads airlines to another decision factor: place though there are minor differences in the various definitions of place, it usually refers to the channels that airlines use to sell their product and services. The more channels airlines apply, the easier it gets for their customers to reach the airline's products and services. Last is promotion which is variety of tools that will make customers know the product, love the product, and hopefully buy the product. That is to say different promotion strategies  are usually needed in order for customers to know, to love, or to buy the product. Basically, all these concepts are derived from the 4P's. As long as the concept of the 4P's understood, the other marketing concepts won't be too hard to understand either.

 

    

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THE IMPACT OF SHARE SWAP BETWEEN MALAYSIA AIRLINES (MAS) AND AIR ASIA

 Malaysia Airlines (MAS) and AirAsia is competitor to each other in the same operating region. As a business competitor both of the company will try to capture the market before the other one wins it. The competition sometimes is too high until they cannot stand with it and hurt each other. So that, route rationalization is a significant method to reduce the competition and both company must be together to develop economy of the country.

MAS as a national carrier which bring Malaysia flag around the globe must be preserved or supported, so that both company cannot to try to kill each other business although they are competitor to each other. Thus, share swaps being introduced with the intention to relax the competition between two companies. After a while, they consolidate each other in term of business operations. However share swaps does not mean that MAS can interrupt AirAsia business strategy and vice versa, but they are allowed to co-operate in term of the operations. For example, they can do code sharing.

At the same time, MAS which is owned by the Government have to fulfill the Government needs and want, they have to follow any instruction by the Government. Therefore, MAS is carrying more national responsibility rather than its competitor; AirAsia. MAS also carry the burden to fly to unprofitable route as a social service to the nations while AirAsia is freely to focus on their business.

However, this share swap give direct impact to:

Malaysia economical impact

• The cancellation of Firefly’s flight to Sarawak is a step to reduce AirAsia competitivenes level because Firefly as MAS’s subsidiary low cost carrier is a perfect competitor to AirAsia.
• This is not good for our economy, since it will reduce the income as less airlines operates. 
• This share swap had been looking as a monopoly agreement of both parties. This also will cause a major impact on tourism industry of our country. Tourism industry among a major contributor for Malaysia’s GDP.

If we refer to the case happen in Sarawak, where the state try to seek opportunity to offer foreign airlines to operate into Sarawak, this will create another wave to our economic stability. This situation, if not being controlled, will cause major injury to our airlines industry as the number of direct competitor increasing. Increasing number of competitor is not good for our local airlines industry as they have to struggle to be sustain in this industry. 

However some airline analyst state that this share swap give benefit to both parties because share swaps being introduced with the intention to relax the competition between two companies. Both parties will consolidate each other in term of business operations and not try to kill each other. If it true, then it is good for our country because both airlines can focus on their business without so much competition within the domestic and they can divert their attention to foreign airlines. This will stabilize GDP of the country and will strengthen our economy when both airlines consolidating each other for a firm business operations.

The impact to Malaysia Airlines

• MAS seemed the most suffer for this deal. At the initial of the share swap, MAS management structure has been restructure and their personnel being replaced including the Managing Director, Tengku Azmil. 
• There are also changing in MAS operation, for example, MAS terminated its route to Capetown and Buenos Aires happen after the restructuring and share swap.
• For the first 4 month after the share swap shows that MAS experienced loss of RM 1.28billion for the final quarter of the year 2011 and total RM 2.5billion loss after 8 month of the deal. 
• It shows that the deal is not helping the MAS to recover, instead of that MAS keep loss.
• It is also said by the former MAS managing director, that the share swap will not resolve the MAS woes. Under the deal, AirAsia will send its aircraft to MAS for maintenance, this will increase the high operating cost of MAS while it only get the less benefit from the deal comparing to what AirAsia get, it’s not shock if MAS will loss for the next financial quarter.

However, for the chairman of AirAsia Tan Sri Rafidah Aziz, the loss that MAS get has nothing to do with the share swap. She says: “MAS has been making losses from some time back and it is not because of the share swap,”

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ISSUE IN AIR TRANSPORTATION

Microchip disappeared: MAS Cargo urged to security level

PENANG: Police ask management MASKargo and Malaysia Airports Berhad (MAB) to increase security measures at the Air Cargo Complex in the state to ensure that it is not conceded more in the future.

State police chief Datuk Koh Hong Sun said immediate action must be taken by both sides to repair the weaknesses is there between him and adding closed-circuit cameras (CCTV) in the area.

He said a special meeting was held with both management today and they have identified several weaknesses that allow area easily transgressed irresponsible parties.

When talking to reporters here, he suggested that both the management gives police powers to the security guard on duty at the complex as well as supplying guns to guard their safety.

"Also equipped with power and guns, more frequent and extensive patrolling should be done in the area to ensure safety," he said.

Koh said CCTV should be installed on the inside and outside of the security hut to enable the authorities to monitor and support CCTV should also be installed in the vicinity.

"Ideally, the security guard posted personal details or identities of those entering and leaving the other area assisted recording of CCTV," he said.

He said the inspection document for permission to enter the area should also be carefully and any copy or photocopy of a letter or document can not be accepted.

In the early morning incident yesterday, a group of about 20 robbers, the four of them dressed in Rela, entered the Second Air Cargo Complex in Batu Maung was about 2.15pm morning.

Coming of four Rela members on the grounds of illegal immigration inspection in the area were not suspected by the security guard in charge of the entrance.

A moment later, two container lorries, leading the remaining robbers hiding in them, are allowed to enter the area after the driver supposedly produced a copy of a letter from a company to unload the goods.

Conclusion

Finally, the security of air cargo could collaborate with the International Civil Aviation Organization (ICAO) and the World Customs Organization (WCO) to jointly host a conference on "Facilitating and Improve Air Cargo Security

Ministry of Transport and Customs collaboration with ICAO and WCO, can bring together aviation safety officer and the customs authorities as well as private sector stakeholders.

with this, the goal of identifying methods to enhance cooperation and coordination in strengthening border and aviation security and at the same time facilitate the movement of air cargo smoothly and safely.

ICAO and WCO Joint also taken steps to enhance cooperation between the two organizations in ensuring air cargo from interference, and at the same time facilitate the movement of goods by air worldwide.

It will also benefit the two organizations between ICAO and WCO, and confirmed its commitment all parties to work towards a common goal, namely to ensure the success of the air cargo supply chain are safe and efficient.

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KLIA and LCCT

Have you ever heard about this two main airport? This is our Malaysia major airport for air transportation. Well known with service of aircraft cargos and passengers. It is the same airport but different terminal, different buildings, situated at different ends of the runway. KLIA is Terminal 1 and LCCT is Terminal 2. The two terminals are probably 20 miles apart.

First and foremost, let’s talk about KLIA. The airport is called Kuala Lumpur International Airport, but well known as KLIA. We can say that KLIA is a landmark of Malaysia. It is the main international airport in Malaysia located in Sepang district of Selangor. KLIA is the biggest airport in our country with 100 square kilometres, although there is total of 58 other airport on East and Peninsular Malaysia. Mostly, the other airport is for domestic flight only. 

It began its operations in June 1998 and still operates until now. KLIA is capable of handling 35 million passengers and 1.2 million tonnes of cargo a year in its current phase. The airport was officially inaugurated by Yang di-Pertuan Agong’s Duli Yang Maha Mulia Almarhum Tuanku Ja’afar ibni Almarhum Tuanku Abdul Rahman. The airport is operated by Malaysia Airporsts (MAHB) Sepang Sdn. Bhd. and is the major hub of Malaysia Airlines, MASkargo, AirAsia, AirAsia Malindo Air and Department of Civil Aviation (DCA).

There are an international and domestic flights operating on the airport, therefore terminals of the airport are well equipped with immigration processing facilities with security scanning to all passengers. KLIA is most popular with international flights. Due to the price ticket offered on domestic flight is way too high.

Another major airport is Low Cost Carrier Terminal, LCCT also known as budget terminal. It was opened at KLIA to satisfy for the demand of users of low cost airlines, especially the passengers of Malaysia’s first ‘no-frills’ airline, AirAsia. Like I mention before, LCCT located about 20km away from Kuala Lumpur International Airport’s Main Terminal Building (MTB), the 35,290 square meters LCCT was constructed on a fast track basis at the beginning of June 2005.

This airport is fully operating on 23^rd of March 2006. LCCT was the first airport to have separation between normal carriers and low cost carrier. The terminal may have different charges and costs. The concept of the budget terminal was taking the lead by Tony Fernandes of AirAsia at Kuala Lumpur International Airport in 2006.

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