MASwings (MY, Kota Kinabalu) has announced it will cease operations on eight domestic routes in Sabah and Sarawak, effective January 1, 2019. In a statement, the Malaysian regional specialist said the decision to withdraw from these eight routes was driven by a recent Ministry of Transport decision to defund them under the two parties' new Public Service Obligation (PSO) agreement.

"These routes have been removed by the government from the new PSO Agreement as they no longer fall under the definition of PSO under the Malaysian Aviation Commission (MAVCOM) Act," it said.

As such, service of the following routes will end on December 31, 2018:

  • Kota Kinabalu - Sandakan - Kota Kinabalu;
  • Kota Kinabalu - Tawau - Kota Kinabalu;
  • Kota Kinabalu - Miri - Kota Kinabalu;
  • Kota Kinabalu - Sibu - Kota Kinabalu;
  • Kota Kinabalu - Bintulu - Kota Kinabalu;
  • Kota Kinabalu - Miri - Kota Kinabalu;
  • Kuching - Sibu - Kuching;
  • Kuching - Bintulu - Kuching;
  • Kuching - Miri - Kuching.

Transport Minister Anthony Loke said in a statement on November 21 that AirAsia (AK, Kuala Lumpur International) would assume the Kota Kinabalu – Sibu and Kota Kinabalu – Bintulu routes from January 2019 onwards having already begun operating the Kuching – Sibu; Kuching – Bintulu; Kuching – Miri; Kota Kinabalu – Miri; Kota Kinabalu – Sandakan; and Kota Kinabalu – Tawau routes.

The Kota Kinabalu – Sibu and Kota Kinabalu – Bintulu routes were among over 30 Rural Air Service (RAS) routes in Sabah and Sarawak that were operated by MASwings and subsidised by the government. However, the original contract that was to have run until 2024 has since been replaced with the new PSO agreement which removed the provision of subsidies for the eight aforementioned routes.