Monopoly Case - Merger Between Mas and Airasia

As a public, what we can say from merger between MAS and Air Asia Bhd is it seems like monopolization. The step done by government by sell share of MAS to Air Asia by 20 percent through stock exchange will constitute a monopoly in the aviation industry and the potential to make loss to the country and people will increase. The monopoly exist when a specific people is the only supplier of a particular commodity. It causes a lack of economic competition produce the good or service and lack of viable substitute goods. What can be see here when monopolization occur in aviation industry, so the price of service can increase because lack of competition between them and they will mutually protect their right. It might be is a win-win situation for them, but what might happen to public, it can’t give any guarantee that public also in win-win situation. There have many accusations from public which said that the exchange does not settle the problem but it might to bring suffer to public as well.

Furthermore, we also worried the consumer goods problem which facing by public right now will infect to aviation industry. We are facing problems (sugar, rice, flour and oil) because of granting permits to companies and group that make cronies that cause price of rice increase highly from rightly. This will happen because of the main importer and price dominator have right to control the market. So, just imagine if there have too many companies have permission to import the rice, so the price will bound by market power. This will burden the public. So, the question frequently ask by us is whether aviation industry tend to follow this monopoly?

When these mergers happen, the price of service might increase because of no more competition between these 2 companies. If there have competition, the price will always increase and decrease to meet people needs and they always fight to fulfill customers’ needs. But, if no competition between them, customer does not have