KUALA LUMPUR (Jan 16): Regional airline SKS Airways Sdn Bhd, recently renamed True Air Sdn Bhd, has announced that it will discontinue its operations — the second homegrown airline to have ceased operations post the Covid-19 pandemic. Budget carrier MYAirline Sdn Bhd had suspended its operations in October 2023 due to financial pressures.
True Air cited factors including challenges in the regulatory environment, operational constraints and the broader aviation landscape as reasons for its decision.
"Since its inception, True Air has been committed to providing safe and reliable air travel services, striving to contribute meaningfully to Malaysia’s aviation sector. However, the evolving circumstances and complexities of the industry have presented obstacles that have made it untenable for us to continue operations," it said in a statement on Thursday.
"A key factor in this decision was the realisation that island-hopping operations using Twin Otter aircraft without government grants are not a viable business model. Additionally, operating jet aircraft as a startup airline proved equally challenging, further contributing to this difficult conclusion," it added.
News of True Air's decision to wind down its operations was first reported by FMT.
In the statement, the airline also said it is committed to ensuring all outstanding financial commitments are fully settled, and leaving no debts behind.
The decision came amid a 90-day suspension of then SKS Airways' air operator’s certificate (AOC) by the Civil Aviation Authority of Malaysia (CAAM), which was due to end on Jan 21 this year. Its air service licence (ASL), which is issued by economic aviation regulator Malaysian Aviation Commission (Mavcom), expired on Dec 31, 2024.
Last October, CAAM chief executive officer Datuk Captain Norazman Mahmud had confirmed that the temporary suspension was issued on Oct 22, 2024 as SKS Airways “did not satisfy the AOC requirements”. He did not elaborate.
A check on CAAM’s website shows that for the purpose of issuance or renewal of an AOC, the airline’s fleet must have a minimum two aeroplanes or helicopters to operate scheduled passenger flights. This specification may, however, be reduced to one aircraft/helicopter for non-scheduled operations. The airline must also ensure that it has the financial resources to conduct its operations.
When contacted by The Edge, a Mavcom spokesperson said the assessment of a renewal of an ASL by the commission is contingent upon the licensee's compliance with the Malaysian Aviation Commission Act 2015 (Act 771) and the conditions outlined in the ASL, including the possession of a valid AOC issued by CAAM. Airlines require both the ASL and AOC to operate a scheduled passenger or cargo airline business.
SKS Airways was incorporated in November 2017 and took off in January 2022 during the Covid-19 pandemic, with a focus on serving island holiday destinations in Malaysia such as Pangkor, Tioman and Redang islands. It started with two DHC-6-300 Twin Otter turboprops.
In May 2023, SKS Airways had signed a 12-year operating lease agreement with US-based aircraft lessor Azorra Aviation Holdings LLC for 10 new Embraer E195-E2s. The new aircraft were supposed to form the core of its expansion plans out of Sultan Abdul Aziz Shah Airport in Subang, Selangor, (Subang Airport), as well as to replace the two ageing Twin Otter aircraft. However, SKS Airways had suspended taking delivery of the E195-E2s after the airline failed to secure the desired number of landing and take-off slots at the airport.
The Mavcom spokesperson told The Edge that the four jet slots at Subang Airport, which were initially assigned to SKS Airways, have since been reallocated. "Three slots were allocated to: one each to AirAsia Bhd, Malindo Airways Sdn Bhd [Batik Air Malaysia] and FlyFirefly Sdn Bhd [Firefly] for flights to Singapore. The remaining slot was allocated to Firefly for a domestic destination."