This article first appeared in Forum, The Edge Malaysia Weekly on August 28, 2023 - September 3, 2023

On March 1 this year, the Kuala Lumpur International Airport (KLIA) hogged the limelight for the wrong reasons.

Pictures of some 114 passengers holding umbrellas and lugging their bags along the 1.5km railway track that connects the main airport building to the satellite terminal were splashed all over social media.

It was raining and the KLIA automated people mover, better known as the KLIA aerotrain, had broken down midway — again. The airport authorities sent a second train to ensure that the passengers could continue their journey.

But the second train broke down too.

Finally, personnel from Malaysia Airports Holdings Bhd (MAHB) rushed to the malfunctioning aerotrain to hand out umbrellas to the stranded passengers and guide them along the railway track — also known as the guideway — to the satellite building for their onward journey.

The breakdown caused 10 passengers to miss their flights, and MAHB made arrangements later for them to continue their journey on other flights.

But the damage was done. Videos of the passengers walking along the guideway caught the attention of many.

The incident on March 1 was not the first time the aerotrain had broken down. The service, which started in June 1987, had been facing problems since late 2000. It was suspended for more than four months from November 2010 until end-March 2011 for modification and improvement works.

Under the 2010 asset upgrade programme, MAHB added a third train set with three cars to supplement the existing two-car train sets that had been in operation since 1998. Which means, of the three trains providing the aerotrain service, two were 25 years old while the third was a relatively young 13 years.

The aerotrains had malfunctioned several times before the March 1 incident, causing passengers to endure anxious moments, especially those with a tight window between flights.

The series of breakdowns led to MAHB undertaking a major asset replacement programme to change the train sets to the latest models and to upgrade the system. If anybody had thought that the aerotrain issue at KLIA was resolved with the exercise, they were grossly wrong.

MAHB and the company awarded the aerotrain major asset improvement job — Pestech International Bhd — are at loggerheads. MAHB has terminated Pestech’s contract, a move that the latter is disputing. The matter could turn out to be a messy affair.

Pestech was awarded the RM742 million contract to design, build, commission and maintain the aerotrain system in December 2021. Pestech was to solely finance the project and was to be repaid over six years. In return, it would get a 10-year maintenance contract for the aerotrains.

Many of the bigger players in the railway segment of the construction industry shied away from the project because it required deep pockets. The contractor needed to come up with an upfront financing package to pay all the vendors before the money could be recovered.

According to the project’s schedule, by March 2025, which is three years from the date Pestech took site possession, KLIA was supposed to have three sets of new trains running on its upgraded dual-lane railway tracks.

During the construction phase, at any one time, one of the two tracks was supposed to be in service while the other was being upgraded. This meant that MAHB would be able to continue the aerotrain service but on a limited basis.

But after the March 1 incident, even the limited services stopped. MAHB instead resorted to using buses to ferry passengers between the main building and satellite terminal.

Last week, MAHB terminated Pestech’s contract on the grounds that it had delayed delivery of the job, something that Pestech is contesting. MAHB contends that Pestech delayed the job by 227 days.

But Pestech claims that it is only two months behind and that it is now able to finish the job three months ahead of schedule with the entry of a new partner in the form of cash-rich IJM Corp Bhd.

MAHB and Pestech may have their differences. But the ones paying the price are the passengers using KLIA.

To a large extent, the fiasco reflects on the country as a whole. This is because the satellite terminal caters for wide-body international flights that carry a substantial number of foreigners. It is the first point of contact for a foreigner coming to Malaysia.

Imagine a foreigner arriving at the KLIA satellite building. The plane docks and he or she walks out to an impressive steel structure with first-class facilities. However, as they look to exit the terminal, they are ushered into a bus to be taken to the Immigration clearance point and to collect their luggage.

First impressions count. On this score, KLIA rates poorly due to the prolonged troubles of the aerotrain service.

The aerotrain saga puts all parties in a bad light. It shows that we do not have the capability to handle asset replacement projects smoothly.

The dual guideway aerotrain tracks are a mere 1.5km stretch. Since there are two tracks, it is a total of 3km of system upgrade work. This does not include a spur line to the depot.

The job is a brownfield project, meaning that the infrastructure exists. It needs a major upgrade and improvements to the system.

Why is Pestech having difficulties in its execution? Pestech has earned a track record in undertaking electrification jobs with the Mass Rapid Transit 2 and other rail projects. Did it bite off more than it could chew, especially with regard to meeting the financial obligations of the project?

As for MAHB, why it decided to undertake the aerotrain replacement project on a deferred payment method instead of a straightforward procurement contract is a matter about which it knows best.

After all, out of the RM742 million, the project cost is RM396 million, which is not an insurmountable amount for MAHB to raise. The rest is for financing and maintenance charges that Pestech requires to maintain the trains and system until 2034.

MAHB would have had its reasons for awarding the project on deferred terms in 2021. At the time, the country was coming out of the pandemic and MAHB was badly affected.

But in hindsight, it is a lesson learnt for other projects such as MRT3. Only companies with deep pockets can undertake jobs where they are paid on a deferred basis.

Another matter that the aerotrain affair highlights is the maintenance of the existing trains. What caused the breakdown of two aerotrains on a single day on March 1?

When MAHB embarked on the asset replacement exercise in early 2022, it stated that the existing train sets had been in operation since June 1998, were old and needed to be replaced. However, the third train set was purchased only in 2010/11. It is less than 13 years old.

Why was it not operational? Is there a problem with the system or maintenance of the train set?

The hoarding around the facilities in KLIA states that the aerotrains will start to operate in phases by the middle of next year. But with MAHB and Pestech locking horns, that is unlikely to be the case unless the two companies resolve their differences.

Both companies have their reasons for the blowout. But the idle aerotrains in KLIA are a stark reminder of the shameful lack of capability to handle a relatively small project that is of great importance to the country.

M Shanmugam is a contributing editor at The Edge

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