One of the more rewarding topics I taught during my stint as a lecturer in a local university was marketing in transport services. It included the topic of market segmentation.
This subject explored how to identify different passenger groups within a market, determine their preferences, estimate market sizes, and analyse how shifts in key factors could alter passenger demand dynamics.
Industries such as airlines, cruise lines, car ferries and the high-speed rail (HSR), among many others, heavily depend on such market research to tailor their offerings.
For providers of these services, understanding the market base and segmentation is not just an academic exercise but a critical commercial necessity.
For instance, it supports market practices of dividing an aircraft into three distinct classes—economy, business and first—or a cruise ship with four main cabin configuration categories—interior, oceanview, balcony and suite.
Adding to this complexity is the fierce competition among different operators, which requires constant refinement of research outcomes to stay ahead.
New rail project
In recent years, I have observed with interest the debate surrounding the HSR project in Malaysia, and the assumptions made in support of it.
While the discussions are fascinating, the reliance on airline statistics to justify the HSR project strikes me as overly simplistic and, perhaps, presumptuous.
The proposed HSR service remains largely undefined, and its market base, segmentation, and size are rather fuzzy.
Much groundwork still needs to be done to validate or challenge the projected passenger numbers.
For example, the current approach of connecting Kuala Lumpur (KL) to Singapore from a “ground zero” market base is fraught with risk.
Building a viable market from scratch is a daunting task, especially without leveraging existing travel patterns or infrastructure.
A connection via KLIA
A more sensible market-based approach would be to integrate the HSR with the existing KLIA Express service.
By connecting the HSR to the Kuala Lumpur International Airport (KLIA), the project could tap into an already established market base.
KLIA is the largest and busiest airport in Malaysia and, in 2023, handled 47.2 million passengers, of which 32.5 million or 68% were international passengers.
KLIA Express, which connects the two terminals to KL Sentral, has proven its value as a high speed product.
Though much shorter in length, a steady flow of passengers is well established, and linking it to the HSR would create an organic market expansion.
This would allow passengers arriving at KLIA to seamlessly travel south—to destinations such as Melaka, Johor, and Singapore, or north to KL.
On the other hand, the current idea of starting the HSR from TRX (Tun Razak Exchange) and bypassing KLIA altogether seems shortsighted.
Such a plan risks alienating potential passengers who would need to transfer multiple times just to access the service.
For instance, passengers traveling from Johor or Melaka to KLIA would have to endure unnecessary detours to TRX and KL Sentral before boarding the KLIA Express to the airport.
This inefficiency could deter travellers and undermine the market potential of the HSR.
KLIA is a natural hub with significant passenger traffic and connectivity. It offers a clear starting point to establish a market base for the HSR.
However, the potential market should not stop there.
North of KL
Instead of ending the HSR route at KL Sentral or focusing only on southern routes, the line could penetrate further north, creating a larger and more viable market catchment area.
Extending the HSR to areas north of KL, such as Rawang, Tanjung Malim and Ipoh, would be a logical and strategic move.
Ipoh, as a city with growing economic activities and an expanding population, has poor air connectivity. The HSR can easily fill this vacuum.
In fact, the state of Perak and northern Selangor, represents two strong demand bases, both for business and leisure travellers.
By including stops in strategic towns north of KL, the HSR could capture a wider segment of passengers who currently rely on the slower ETS rail and road travel.
This extended northern route would provide a seamless travel corridor connecting key urban centres from Ipoh in the north to Melaka, Johor and Singapore in the south, maximizing the HSR’s economic and social benefits.
Furthermore, by linking major cities in the northern region, the HSR could better support domestic tourism, regional trade and commuter mobility.
Such connectivity would strengthen the case for the HSR, making it a truly national asset that serves not only travellers to and from Singapore but also a much broader population base within Malaysia.
Conclusion
The first step toward building a sustainable and profitable market base for the HSR must involve integrating it with KLIA. This will allow it to leverage an existing passenger market base which is largely made up of international travellers.
The second step, equally important, is to extend the route northwards, reaching as far as Ipoh, and creating a comprehensive north-south travel corridor.
This dual focus on connectivity and market integration would ensure the HSR serves as a transformative project that meets both domestic and international travel needs while minimising the risks associated with a fragmented or limited market approach.
For a practical and customer-centric HSR service, aligning with KLIA and extending northward isn’t just a good idea — it is essential to establish a firm market base, with clear market segmentation and size.
The author can be reached at: [email protected]
The views expressed are those of the writer and do not necessarily reflect those of FMT.