The wholly-owned airline of Malaysia Airlines is expanding its reach domestically, going up against AirAsia, and will start flights to ASEAN countries from the KL International Airport in Sepang from next year.

Firefly, which began operations in 2007 operating out of Skypark Subang Terminal, will take delivery of 30 Boeing 737-800 aircraft from this year to 2015, as part of MAS’ strategy in growing its network and building capacity under its Business Transformation Plan.

The new aircraft marks Phase I of the airline’s expansion plan, spanning 2011 to 2015. It will fly out of the KL International Airport (KLIA) in Sepang while maintaining its base in Subang with its fleet of seven ATR 72-500 aircraft.

Dato’ Eddy Leong (pictured right), Firefly’s managing director, said this phase of expansion “involves bringing into service a total of 30 aircraft, which will allow for an aggressive growth rate in our route network. In 2011 alone we will operate six Boeing 737-800s.”

The airline will take delivery of its first B737-800 plane in December, which will begin operations on15 January 2011 from the main terminal building at KLIA to Kuching (Sarawak) and Kota Kinabalu (Sabah).

The delivery schedule for the B737-800s is six next year, seven in 2012, seven in 2013, five in 2014 and the last five in 2015.Leong said Firefly chose the B737-800 because it has been used to great effect by “the most successful LCCs in the world” namely, Southwest Airlines and Ryanair.

The narrow-body aircraft has 189 seats in a single-class cabin configuration – nine seats more than the Airbus 320s used by AirAsia, Jetstar and Tiger Airways – and will enable lower operating cost that would translate into competitive fares for its customers, he said.He declined to reveal the new destinations Firefly intends to fly to, citing traffic rights approval.

He, however, said Firefly’s focus would be on the ASEAN region. “All the major ASEAN countries are eventually candidates.”

Flying out of KLIA will also benefit the airline’s passengers as it will allow Firefly to offer “a little bit of frills” at a marginal cost, while keeping prices competitive in addition to better flight connectivity with other airlines.

Leong insisted that Firefly would not be competing with MAS as the two airlines are targeting different market segments – MAS focuses on full service while Firefly is targeting the price-sensitive and value-driven market. It will have a one-way code share with MAS, which means that MAS ticket holders will be able to fly on Firefly but not vice versa.

With Firefly operating out of KLIA, it cannot be denied it will be in direct competition with AirAsia, which has its hub at the nearby low-cost carrier terminal. The airline’s expansion is seen as helping MAS compete with AirAsia, which currently has a bigger share of the market, as well as resolve the issue of whether MAS should form an LCC to get a share of the market.

AirAsia’s group chief executive officer Dato’ Seri Tony Fernandes, as usual, is unfazed by the latest development. “We are beyond worrying about what legacy airlines do. AirAsia has grown and will continue to grow positively due to a disciplined focus on cost and the short haul single class model,” he said in a statement.

But for now Firefly seems to have the best of both worlds – a base each in Subang and in KLIA – and it intends to keep it that way.

Leong said that Firefly has no intention of moving its turboprop fleet to KLIA as it is currently “making money in Subang”  with a seat factor of about 75 percent. It plans to add another ATR 72-500s by December and one by January next year. It currently services19 cities within Malaysia, Thailand, Indonesia and Singapore.

• Photos courtesy of Firefly

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