KUALA LUMPUR: SKS Airways, a member of Johor-based property developer SKS Group, was launched in January 2022 by MCA president Datuk Seri Dr Wee Ka Siong with the ambitious goal of becoming a premium airline targeting affluent travellers by flying the state-of-the-art Embraer E195-E2 aircraft out of Subang Airport.
At the time, Wee said SKS Airways charted history in the Malaysian aviation industry, as it is not easy to obtain an air operator's certificate (AOC) from the Civil Aviation Authority of Malaysia (CAAM).
The plan tied in with the government's proposal to turn Subang Airport terminal into a Premium Green City Airport, under the Subang Airport Regeneration Plan (SARP).
Its inaugural flight was to Pangkor Island in January 2022 using its fleet of DHC-6 Twin Otter turboprops.
It was the first airline to operate scheduled commercial flights to the island.
A source said prior to its plan of becoming a premium regional airline based in Subang Airport, SKS Airways had wanted to serve as a full service carrier.
"They're very ambitious and they managed to secure the Embraer (aircraft) deal. But to run an airline is tough and the biggest challenge that any airlines face is the expenses in U.S. Dollar vs the currency for the income they receive," the source added.
However, this ambition could turn out to be just a pipe dream if the airline is not able to secure funding to pay for the pre-delivery commitments of the 10 regional jets from U.S. based aircraft lessor Azorra Aviation Holdings.
"An E195-E2 airplane has lower seat number than the other narrowbody (aircraft) such as Boeing or Airbus. It's less than 150 seats vs 180 or 190 (seats). That means they (SKS Airways) have to sell their flight tickets at a premium price to cover their (operational) costs and make some profit," a source told Business Times.
According to checks with Companies Commission of Malaysia, (SSM) SKS Airways is controlled by SKS Group chairman Alan Sim See Kiong and SKS Southern Sdn Bhd, a property and construction company wholly owned by Alan Sim's daughter Cindi Sim, with a 70 per cent stake.
SKS Group is a property, hospitality, credit finance and aviation group headquartered in Johor Bahru, Johor.
The remaining 30 per cent interest is owned by Datuk Majid Manjit Abdullah.
As at December 31, 2022, the company reported a net loss of RM23.95 million, on RM3.09 million revenue.
Its retained earnings were in the negative of RM53.39 million, a sign of losses for more than one year.
The company remains in a net asset position however, with current and non-current assets outweighing current and non-current liabilities.
SKS Airways is the second airline in the last two months to face a cash crunch.
MyAirline Sdn Bhd abruptly halted operations in October 2023 after a white knight pulled out at the eleventh hour.
SKS Airways is currently scrambling for funding and investors to pay the pre-delivery commitments for its aircraft.
It is believed that its much-celebrated newly minted chief executive officer Dzuleira Abu Bakar has also resigned just three months into the job.
SKS Airways, which was incorporated on Nov. 13, 2017, was granted an air operator certificate (AOC) by the Civil Aviation Authority of Malaysia (CAAM) on Oct 1, 2021 and a conditional air service license (ASL) by the Malaysian Aviation Commission (Mavcom) on March 1, 2019. On Jan 1, 2022, Mavcom gave it a full ASL, which lasts for three years. /ends
