FAA Downgrades Malaysia’s Safety Rating, Potentially Affects AirAsia X’s Plans

On November 11, 2019, the Federal Aviation Administration (FAA), announced that it has downgraded Malaysia’s safety rating from Category 1 to Category 2.

With that, airlines from Malaysia cannot expand their service to the United States at this point.

FAA Downgrades Malaysia's Safety Rating to Category 2, Only AirAsia X Potentially Affected
Malaysia was a Category 1 country from 2003 until earlier this year.

Malaysia Reassessed as a Category 2 Country by the FAA

The FAA classifies countries into two categories: those that meet the International Civil Aviation Organization safety standards (Category 1) and those that don’t (Category 2).

Rather than the classification being a testament to how safe any single airline within the country is, the assessment looks at the aviation landscape in the country overall. In other words, it looks at the capabilities (legislation, oversight, certification, etc.) of the FAA’s equivalent in the country, of the local regulator.

While Malaysia was certified as a Category 1 country from 2003 until recently, according to the FAA:

The FAA conducted an in-country reassessment of Malaysia under the IASA program in April 2019, and met with the CAAM in July 2019 to discuss the results.

The country was reclassified since the FAA determined that the Civil Aviation Authority of Malaysia (CAAM) doesn’t meet ICAO’s safety standards.

With that, Malaysia has joined the ranks of Bangladesh, Costa Rica, Curacao, Ghana, and Thailand.

As a Category 2 country, airlines from Malaysia:

  • Cannot establish new routes to the United States or codeshares with US airlines
  • Can continue their existing flights to the United States and codeshares with US airlines

AirAsia X Is the Only Potentially Affected Airline

As mentioned earlier, the FAA safety rating downgrade doesn’t make Malaysia Airlines, AirAsia, Malindo Air, or other airlines based in the country any less (or more) safe than they were before. Instead, it simply establishes that there is a room for improvement in how the Malaysian regulator operates.

While other countries might look at the country’s airlines because of the FAA’s downgrade, at this point, it only affects flights by Malaysian airlines to the United States.

Since Malaysia Airlines cancelled its Los Angeles service in 2014, the only Malaysian airline currently operating to the United States is AirAsia X with its fifth freedom flight from Osaka in Japan to Honolulu.

Those flights will, however, remain unaffected.

AirAsia X Transpacific
In 2017, AirAsia X launched Osaka – Honolulu. The airline has plans to expand into the US mainland too.

Considering that Malaysia Airlines is not in a position to launch flights to the United States at this point, the only airline potentially suffering from the downgrade is AirAsia X.

Since it will not be able to expand its services to the United States until Malaysia regains its Category 1 rating, its plans to expand into the US mainland might have to be put on hold. If Thailand regains its Category 1 rating first, it also has the option of expanding into the United States using Thai AirAsia X.

Alternatively, since it plans to use Japan as a hub for its transpacific expansion, it also has the option of using AirAsia Japan or establishing Japan AirAsia X. That said, the first of those alternatives of those would be difficult due to AirAsia and AirAsia X being companies with two separate sets of owners and the latter would be extremely costly and likely not even worth considering.

Summary

While the downgrade is a considerable hit to Malaysia’s reputation, on a more practical level, it only potentially affects one airline – AirAsia X – in any significant way.

In fact, AirAsia X will likely push the Malaysian authorities to attempt to regain Category 1 rating as soon as possible. Without that, the low-cost airline’s transpacific ambitions will have to be put on hold or – at the very least – will become much more difficult to execute.

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