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KUALA LUMPUR, Oct 27: The government does not plan to set the ceiling price of domestic air tickets, including for routes to Sabah and Sarawak, as it is concerned that the move will affect aviation supply and air connectivity in the country.
Transport Minister, Anthony Loke said a study by the Civil Aviation Authority of Malaysia (CAAM) found that ceiling or floor pricing mechanisms can have long-term negative effects on consumers and the aviation industry.
Obviously, the allocation of costs by airlines is based on market supply and demand mechanisms, taking into account operating costs.
"The implementation of ceiling prices inconsistent with dynamic market controls is concerned that will force airlines to reduce frequencies or stop continuing operations for certain routes.
"This is because the ceiling price rate can no longer afford too high fuel and control costs.
"If this happens, the implications will affect domestic air network connectivity, reduce seat supply, and ultimately burden consumers in the long run", he said in the Dewan Rakyat today.
He said this as he rolled the debate on the Supply Bill 2027 for his ministry in the Lok Sabha today.
Loke said the government was concerned about ticket prices rising, especially in the run-up to the holiday season, and continued targeted aid to ease the burden on consumers travelling from Peninsula to Sabah, Sarawak and Labuan.
"For 2026, the subsidy aid for the purchase of airline tickets will be increased well by lowering the threshold of eligible ticket prices to more than RM499, excluding taxes and fi, compared to previously RM599.
"The subsidy-eligible travel time has also been extended from three to four days before the date of the main celebration", he said.
Meanwhile, Loke said the rate of aid for FLYS students initiative will be raised from RM400 to RM500 as announced by Prime Minister, Datuk Seri Anwar Ibrahim when presenting Budget 2027 earlier this month. - TVS
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