KINIBIZ AmResearch believes the decision by the Land Public Transport Commission (Spad) to allow an increase express bus fees by an average of 22 percent, could be a positive catalyst for airlines such as AirAsia Bhd.

“The increase in express bus rate narrows the price differential between the two modes of transport quite substantially, and in fact, depending on actual date of travel and destination, air fares can be even cheaper or comparable based on our comparison with flights a week from now,” said the research house.

Furthermore, the fact air travel significantly shortens travel time for passengers when compared to land transport options will help make air travel more attractive.

It highlighted that one of Malaysia’s largest bus operators, Konsortium Transnasional carries around 6 million passengers annually, which was about 30 percent of AirAsia’s total traffic for financial year 2014.

Given the low cost carrier derives around half of its revenue from the domestic market, it could be a beneficiary if passengers start to look for substitutes to land transport options.

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