I found this on Air Asia website......


AirAsia SMS Booking - Another first in the nation!
We are proud to be the first airline in the world to offer flight booking and payment via Short Messaging Service (SMS). Now AirAsia guests can make their flight booking anytime and from anywhere 24 hours and 7 days a week.

Apart from making a Flight Booking, AirAsia guests can also make enquiry on lowest fare, departure or arrival information and city codes. All this is available at a normal cost of RM0.15 cents per SMS and without any additional charges. AirAsia guests can also register to be the first to know of new promotional fares as soon as they are made available.

"Flying should not only be fun and affordable but also convenient. And with AirAsia's SMS Booking, our low fares are only SMS away!" - Tony Fernandes.

Don't wait. Try it now! Simply key in 'AA' or AirAsia and sent it to '39399'

I love this airline.....they are so creative!!! It is the world first. :guns1:

AirAsia launches world’s first airline SMS booking
Kamarul Yunus


Low price and no-frills Malaysian air carrier AirAsia launched the world’s first short message service (SMS) airline booking today, hoping to tap the potential of some 10 million mobile phone users in the country. AirAsia chairman Datuk Pahamin A. Rajab said the move followed the success of its Internet ticketing service, which recorded more than RM80 million in sales since May last year.

"The Internet ticketing service currently contributed 45 per cent of our earnings, but we are not going to target another 40 per cent from the SMS service — merely one per cent is good enough.

"The main thing is to provide convenience to customers," he said after the launch of the SMS booking service in Subang by Deputy Prime Minister Datuk Seri Abdullah Ahmad Badawi.

AirAsia had invested RM3 million to develop the SMS booking system, with collaboration from Maxis Communications Bhd and Dutch-based technology firm Getronics.

"Most of the investment went to the hardware and business development," Pahamin said.

In commemorating the launch of the SMS booking service, Pahamin said the airline would offer a discount ticket price of RM9.99 to any of AirAsia's 12 destinations for the first 1,000 seats to customers who SMS for booking, starting on Friday.

The service will initially be available to some three million Maxis' subscribers but other mobile operators are expected to come on board within the next one to two months, AirAsia chief executive officer Tony Fernandes said.

Earlier, Abdullah, when launching the SMS service, said about 42 per cent of Malaysia's 23 million population owned a mobile phone, compared with 11.7 per cent who were Internet users.

"The new service would therefore allow AirAsia to reach out to nearly 10 million Malaysians," he said.

Users need only type "AirAsia" and send the SMS to 39399.

Apart from the SMS ticketing service, Fernandes said the airline was also working with Malayan Banking Bhd (Maybank) and several commercial banks to allow for payment through credit cards or direct debiting of customers' bank accounts in the next two months.

On the price war with Malaysia Airlines, Fernandes said AirAsia's revenue suffered after the national carrier launched domestic promotions in June to counter a travel slump induced by the Severe Acute Respiratory Syndrome outbreak.

"We hope the Government would find an amicable solution.

"We do see ourselves as two different markets, but it is better for us to work together rather than creating wasteful competition," he said.

Earlier, Abdullah said it was up to the two carriers to draw up their pricing strategies but urged the two to "be friends" and to complement each other.




©New Straits Times (M) Berhad

yea......AirAsia is one of the exhibitors at the Maxis Unplugged Solutions Expo at Mandarin Oriental a month ago. They are showcasing this technology. ;)

cool!! cheap and easy:guns1:

Yeah….cheap and convenient too……Air Asia is really innovative….

His Shin Corp is in talks to buy into budget airline group: report

Thai Prime Minister Thaksin Shinawatra may soon board the AirAsia group as a major shareholder.

Should Mr Thaksin's Shin Corp throw its weight behind the budget airline that's giving regional network carriers sleepless nights, analysts say Air Asia would be on its way to virtually tying up the aviation markets of Malaysia and Thailand, two of the largest in the region.

Thailand's The Nation newspaper yesterday reported that Shin is in talks with Tony Fernandes's upstart to take a controlling stake worth up to 500 million baht (S$21.8 million) in AirAsia's Thai unit. Thailand's largest telecoms conglomerate has confirmed it is in talks with potential partners to invest in low-cost airlines.

The Nation, quoting sources close to the aviation industry, reported on Tuesday that Shin was insisting on holding at least 51 per cent in Air Asia Aviation, which is currently capitalised at 200 million baht (S$8.7 million). The company would need fresh investment of at least one billion baht to commence its low-cost airline business, the source was quoted as saying.

An interesting question that arises from all of this is how a tie-up with Shin Corp would affect the expansion of AirAsia's regional routes, especially where it involves the use of Thailand's bilateral air pacts with other countries?

AirAsia will be offering low-cost flights between Thailand and Malaysia beginning next month.

Thailand signed an 'open-skies' agreement with Singapore, Brunei and Cambodia during the Asean leaders summit in Bali recently.

Kevin Scully, managing director of independent research house NetResearch-Asia, said a tie-up with Mr Thaksin 'would definitely make them more credible and give them more financial muscle'.

AirAsia, which already has a fast-growing domestic network in Malaysia, recently applied for a licence from the Thai government to operate services to various destinations in the country, including Bangkok, Chiang Mai, Hat Yai and Phuket. With seven planes currently in operation, and another 13 more to be commissioned by June next year, it is the fastest-growing low-cost carrier in the world.

Having already sewn up major domestic routes in Malaysia, the Kuala Lumpur-based company is now keen to establish a regional footprint. It has recently been in talks with Singapore's Changi International Airport to get discounts on airport fees so that it can operate flights there.

Meanwhile, it has already started luring Singapore-based travellers with its daily flights from Senai in Johor state to Kuala Lumpur. AirAsia's latest move in Thailand comes on the heels of Singapore Airlines' decision to turn down the Thai government's invitation to participate in a budget airline based in Chiang Mai.

The Thai prime minister had invited Singapore's flag carrier to help launch a 'no-frills' airline to operate out of his hometown, Chiang Mai, after meeting Singapore Prime Minister Goh Chok Tong in January.

If a deal with Shin Corp materialises, it won't be the first foreign interest in AirAsia. In June, two Saudi-based funds - IDB Infrastructure Fund and Crescent Venture Partners - pumped in some US$20 million into the company.

But the arrival of AirAsia in Thailand is not going to be welcomed by all.

Udom Tantiprasongchai, chief executive of private local airline Orient Thai, has already been quoted as saying that he viewed the arrival of the Malaysian budget carrier with concern.

'We should not turn over our national aviation rights to any foreign operator. Our national interest should be protected,' he was quoted as saying.

Orient Thai also plans to launch its own low-cost aviation business next year.

Just got news from airline forum..

Airasia will start their 1st regional destination to Phuket, Thailand on 8th December 2003.

Frequencies : 7 flights per week
KLIA dep time : 9.40am
HKT arr. time : 10.55am

Fares : Start from 90 ringgit one way:)

GO Airasia go.

Boeing 737-300 AAH .....'Jalur Gemilang', is the latest addition in Airasia fleets.

http://www.you-are-a-huge-nerd.com/public/freepix/aai.gif

Another news from The Star..

AirAsia hopes to become an Asean brand
By B.K. Sidhu

KUALA LUMPUR: THE country's only no-frills airline, AirAsia Sdn Bhd, hopes to become an Asean brand with its move to go regional next month.

It begins its maiden regional foray with a flight to Phuket from KL International Airport (KLIA) on Dec 8, a month earlier than scheduled. In January it hopes to fly into Bangkok from KLIA.

On the cards are flights to Singapore, Indonesia and even the Philippines, although AirAsia chief executive officer Tony Fernandes said “it was still too premature” to disclose plans.

Besides that, the carrier would begin offering domestic low-cost air services in Thailand via AirAsia Thailand, a joint venture with Shin Corp of Thailand, in January.

Fernandes said the company believes in creating an Asean brand, and flying into the region would be a logical move.

He said the potential for a low-cost, no-frills airline in Asean was huge given that the 10 Asean nations had a combined population of 550 million, a large portion of whom were middle-class, and with a large population which had never taken to the skies.

He cited the example of Thailand, where of the country’s 65 million people only seven million had ever taken domestic flights.

In Malaysia, AirAsia has created a new market with its low cost fares and since its inception less than two years ago, has flown over 3 million people.

It now flies to 13 destinations using nine aircraft. Next month it opens its second hub in Johor's Senai Airport, hoping to tap into the Singapore market.

Given its success in the domestic market, Fernandes is confident AirAsia would be able to fly over 10,000 passengers to Phuket in a month.

It is offering Phuket at RM89.99 one-way and bookings can be made online.

“We are looking to connecting more points, such as Kota Kinabalu, Miri, and Langkawi from Phuket or Bangkok. Thailand is a great drawer of tourists, and we see this as a win-win for both countries,” he said.

AirAsia Thailand would be based in Bangkok and will fly to destinations such as Phuket, Hat Yai, and ChangMai. Fernandes hopes to begin services from Bangkok to Langkawi and even Phuket-Langkawi-Penang early next year.

Asked on the Bangkok-Singapore sector, Fernandes said: “We are still grappling. We still have no offer from the Civil Aviation Authority of Singapore and we may fly Bangkok to Senai first.”

Although its plans for entry into Thailand is firm, that for flying into Singapore is far from clear.

There has also been no progress in its proposal for a bus service to ferry passengers from Singapore to Senai Airport, which Singapore's transport authorities had rejected.

Fernandes said: “It is Singapore which is losing on tourists arrivals and hotel rooms. ValuAir is going for a higher market. Their Ministry of Transport is too protective and they are not looking at the big picture.”

ValuAir is Singapore's own proposed budget airline. -- The Star

Hmm..Looks like this is a delicate issue. Singapore refused to allow air asia to gain prominence in singapore and also disallow bus service from singapore to senai for a obvious reason. Singapore needs to protect their national airline too, SIA as opening up would make them less competitive and lose out

Of course, on the other hand, it may also benefit singapore, as more people would probably travelled to singapore and vice versa as a result of this development. Tourism of both countries would benefit

But, of course, every decision has a tradeoff, and I supposed that's why it is such a delicate issue.!!!

http://sg.biz.yahoo.com/031120/15/3g1bn.html

MALAYSIA BUSINESS BRIEFS: AirAsia To Fly To Bangkok

KUALA LUMPUR (Dow Jones)--Malaysian-based budget airline AirAsia will fly once daily to Bangkok from Johor Bahru, near Malaysia's border with Singapore, beginning Feb. 2, the carrier said. One-way fares for the route start from 99.99 ringgit ($1=MYR3.80), "representing huge savings for guests compared to existing fares charged by other airlines," AirAsia said.

Malaysian Resources Corp. (1651.KU) said its shares will trade as part of the construction sub-sector on the stock exchange from Friday, versus the trading and services sub-sector previously.


-Kuala Lumpur Bureau, Dow Jones Newswires; 603-2692-5254; djn.kualalumpur@dowjones.com

Interesting. Only from Johor to Bangkok ke? Why don't have it from KL to Bangkok...I don't want to go all the way to Johor to enjoy the fare :D

They target Singaporeans lah I guess hehe

Originally posted by baqthier

They target Singaporeans lah I guess hehe

So not fair :bash:

AirAsia begins ticket sales to Bangkok

SINGAPORE: Budget airline AirAsia has begunticket sales for its regional flights to Bangkok from its Johor Baru hub. The inaugural flight will be on Feb 2.

AirAsia chief executive officer Tony Fernandes said the airline was confident the low fare would attract local and international travellers.

He said he expected the airline to fly at least 1.2 million passengers out of Senai airport next year.

He said AirAsia’s Bangkok-Johor Baru route aimed to encourage travel among the people of Malaysia, Singapore and Thailand.

Fernandes said AirAsia was committed to its second hub, adding that Senai airport was set for bigger and better things in the future.

“Our enthusiasm for Johor Baru speaks for itself.

“We really believe that the market down south is huge and that people want low fares.

“We only make it available and easier for them,” he said at the launch of the ticket sales in the island republic on Wednesday.

One-way tickets for the Bangkok-Johor Baru sector are priced as low as RM99.99 and are available for booking.

The daily flights with a capacity of 148 seats would leave Johor Baru at 3pm and the return flight is at 4.40pm (Bangkok time).

Daily flights from Senai to other domestic destinations such as Kota Kinabalu, Kuching, Langkawi, Miri and Penang would commence on Dec 3.

Fernandes said a Thai-language website for AirAsia was available to cater to its Thai customers, adding that plans were under way to have a website in Tagalog to reach out to the Tagalog-speaking community in the region, including in Singapore, Thailand and Hong Kong.

Fernandes said several governments had approached the airline to include their countries as part of AirAsia’s destinations but he declined to name them.

“We believe that we have changed the landscape of the aviation industry here.

“AirAsia has always aimed at being an airline serving Asean countries but there are even countries outside the region which have approached us,” he said.

On the “glitch” with the Singapore authorities which disapproved its proposal to operate a bus service to ply the Singapore-Senai route, Fernandes said the airline would continue with its plans to make Senai its second hub and would explore other alternatives.

AirAsia had initially planned its second hub in Changi but this was hampered by the high operating costs of the republic’s international gateway.

ha....just a trivia here:

Does anyone remember AirAsia before the company being turned into a no-frills airline?

It used to be a domestic airline for Malaysia along with the likes of Berjaya Air, Pelangi Air and MAS

This airline is started off by DRB-HICOM and here's the logo:

http://www.sarawaktourism.com/Pata/airasia.gif

Originally posted by szehoong

ha....just a trivia here:

Does anyone remember AirAsia before the company being turned into a no-frills airline?

It used to be a domestic airline for Malaysia along with the likes of Berjaya Air, Pelangi Air and MAS

This airline is started off by DRB-HICOM and here's the logo:

http://www.sarawaktourism.com/Pata/airasia.gif

Yeah. I remember it. Like the old one better than the current red color logo :D . But then at that time nobody seem to be bother to use the carrier.

really? I prefer the new logo to the old....the new one has a more modern look to it! Very chic! Sorta Richard Branson-Virgin-like.....

The old airline mainly flew M'sia-E.Malaysia routes I think....

I believe AirAsia is not dumb, they'll initiate the JB-BKK routes first to promote Senai to S'pore passengers, but sooner or later, the flight will either transit via KLIA or there will be a seperate KL-BKK flight.

The company is still keen on Seletar airport in S'pore tho...which makes me wonder how the Senai-Seletar combo will work out.....it won't be cost-effective to duplicate your routes....

The old logo is classy.......fits an airline like MAS.

But for a budget carrier, the current branding fits AirAsia as it is much more dynamic and has a chic & contemporary feel to it - like what Liping has mentioned........Virgin-like looks! :D

And I like its motto/slogan - Now Everyone Can Fly!

GO Airasia GO:)

Cos of u..Now everybody wanna form their own no frill airlines.

Indonesia already have their budget airlines - Lion Air
Thailand - Orient Thai

Originally posted by mams

GO Airasia GO:)

Cos of u..Now everybody wanna form their own no frill airlines.

Indonesia already have their budget airlines - Lion Air
Thailand - Orient Thai

Actually Lion Air and Orient Thai has been around for some time......but they are not as aggressive or as successful as AirAsia.

Everyone is afraid of AirAsia because this airline just operates domestic routes and still could remain profitable.

wah!! chep or not:D

This airline seems to be making lotsa news these days so I think there should be a thread on the airline! :D


AirAsia plans to buy 5 more aircraft next year


BY SA’ODAH ELIAS IN SEPANG


AIRASIA is committed to buy up to five Boeing 737-300 by the end of next year to complete its fleet of 21 jetliners – including 16 on lease – by the middle of next year.

The purchase is expected to be financed through its proposed initial public offering slotted for the second half of 2004.

AirAsia chief executive officer Tony Fernandes said buying planes would be more cost-effective than leasing.

Based on the company’s plan, AirAsia would have a total of 30 aircraft by the end of next year, he told reporters yesterday after the opening of AirAsia’s very own maintenance hanger at the KL International Airport by Transport Minister Datuk Sri Chan Kong Choy.

Chan also witnessed the arrival of AirAsia’s second aircraft, which flew in from Singapore’s Seletar Airport, where it had undergone a refurbishment and overhaul.



http://biz.thestar.com.my/archives/2003/12/12/business/p6chan.jpg
Datuk Chan Kong Choy (far right) on board AirAsia's newly-purchased aircraft. With him are AirAsia chairman Datuk Pahmin A. Rajab (left) and Tony Fernandes.



The arrival of the plane has raised AirAsia’s fleet to 11, including nine leased aircraft.

The plane, which previously served US Airways, was purchased via an agreement with GE Capital Aviation Services last June.

The new AirAsia maintenance hanger, which cost RM2.2 mil, can accommodate a new generation Boeing 737-800 or an Airbus A320.

The hanger will enable AirAsia to carry out routine maintenance and defect rectification of its fleet of Boeing 737-3000s.

Currently, heavy maintenance jobs of its aircraft were sub-contracted to Malaysia Airlines and ST Aerospace Engineering.

Meanwhile, Chan said the government was still studying AirAsia’s application to introduce a new Kuala Lumpur-Bangkok route. “A decision will be made very soon,” he added.

more planes, more flights. cool!

:D :D :D

Nice new seats!
I love Air Asia. No need tickets! Very low fares! Best in the world!
:cool:

i wonder why Air Asia don't want to buy a Boeing 747-400? :?

Originally posted by KJ

i wonder why Air Asia don't want to buy a Boeing 747-400? :?

AirAsia is a 2 year old company and dun have such money........then they only fly domestic so 747-400s are a bit too big (would be underutilised) for domestic routes ;)

In fact no airline uses 747 for domestics unless the traffic is too heavy (like in MAS' case last year for the KK flights)..... :)

Originally posted by szehoong

AirAsia is a 2 year old company and dun have such money........then they only fly domestic so 747-400s are a bit too big (would be underutilised) for domestic routes ;)

In fact no airline uses 747 for domestics unless the traffic is too heavy (like in MAS' case last year for the KK flights)..... :)

hmm... what happened last year in KK??:bash: :bash:

Originally posted by TYW

hmm... what happened last year in KK??:bash: :bash:

I dunno......a lot of people going lah......how I know leh......now MAS flies like 90 times weekly there! :eek:

Originally posted by szehoong

I dunno......a lot of people going lah......how I know leh......now MAS flies like 90 times weekly there! :eek:

wah!! maybe ppl go there to buy vegetables:D :D my aunt say it is very very cheap

Originally posted by TYW

wah!! maybe ppl go there to buy vegetables:D :D my aunt say it is very very cheap

wah.......fly there to buy vege.........you too kaya and no where to spend money ar? Spend so much on air ticket just to save a few cents on veges?!?! ....must be crazy! :bash:

Originally posted by szehoong

wah.......fly there to buy vege.........you too kaya and no where to spend money ar? Spend so much on air ticket just to save a few cents on veges?!?! ....must be crazy! :bash:

hmm... then maybe they buy fishes as well:D

he he... joking lah.

Originally posted by TYW

hmm... then maybe they buy fishes as well:D

he he... joking lah.

fish and dog and cat were not allowed on the plane :D :D :D

I see. Domestic Flight is just needed a plane smaller..... :D

Another interesting read......

;)


Asian airlines face no-frills challenge


Analysis by K.P.LEE


IT MUST be a discomforting sight for executives at the national airline.

From the picture-perfect windows of its well-appointed Golden Lounge at KL International Airport’s domestic concourse, Malaysia Airline’ (MAS) business class passengers enjoy a commanding view – many times a day – of the flashy red planes on the apron.

There, veritable billboards with huge AirAsia.com letters splashed across the fuselage of Boeing 737s, announce: “Now Everyone Can Fly.”

It’s hardly a view the airline, which until two years ago was carrying almost every air traveller in Malaysia, had been hoping for to greet its most valued customers. But that is the new reality for MAS.

Cheeky upstart AirAsia that sells cheap fares over the Internet is wooing customers away and growing bigger by the day it seems. It is becoming a real challenge to the established order.

The carrier, which claimed to be profitable almost from the word go, has forecast a net profit of RM60mil on the back of revenues of RM450mil next year. A stock market listing is on the cards. By then, it plans to be flying 30 Boeing 737s, closing in on MAS which has 37 of the short-haul jets.

Nor is the challenge a purely local one. The threat to established airlines like MAS is now region-wide. While some big airlines have been “consolidating,” low-cost carriers have been expanding.

AirAsia had recently announced a new Bangkok-based joint venture to challenge Thai Airways’ dominance on trunk domestic routes in what could be an exact carbon copy of its Malaysian operations, while starting its first intra-regional route between KLIA and Phuket this month.

Meanwhile, in Singapore, budget airline ValueAir is set to fly next year. In response, Singapore Airlines joining the fray last week, said it would be teaming up with Europe-based Ryanair to form Tiger Airways, a no-frills airline also with a scheduled 2004 take-off.

Virgin Blue, the low-cost carrier that has captured close to a third of the local Australian market in just three years, has also been reported to be interested in Asia, with AirAsia rumoured as a likely partner. Other players in the Philippines, Thailand and Indonesia want a slice of the action too.

In fact, the establishment of the budget carrier has been regarded as a key milestone for aviation, which on Wednesday will mark another – it’ll be one hundred years since Orville Wright’s first powered flight at Kitty Hawk.

While the centennial year outlook for the airline industry, which suffered collective losses of US$13bil last year and expected to lose between US$5bil and US$10bil this year, cannot be more dire, low-cost carriers stand out as beacons of success.

They now account for 25% of air travel in the United States after 25 years of deregulation, and 10% in Europe, where there had been an explosion of new airlines over the past decade.

While US behemoth United Airlines sought Chapter 11 bankruptcy protection and well-regarded Swissair went belly-up in Europe, their low-cost competitors like JetBlue and Easyjet filled planes turned in profits.

Now, it seems, it’s Asia’s turn. So, is this the beginning of the end for the established full service airlines like MAS, Singapore and Thai?

Analysts said no. Formidable though the competition might be for established airlines, they said that what the newcomers had stacked against them were regulations and treaties, which generally worked in favour of incumbents. (Not to mention that statistically, nine out of every 10 airlines start-ups fail.)

ING Financial Markets aviation analyst Philip Wickham said it was far too early to write off the national airlines. “They will stay. I think the doom scenario is overdone,” he said.

Asia did not have the same sort of single aviation market seen in the United States or Europe, he said.

“You wouldn’t see an Asian version of Ryanair developing because of the restrictive air service agreements. Therefore, a pan-Asian or even pan-Asean low-cost airline would be unlikely in the foreseeable future,” he said.

“AirAsia, for example, cannot operate on Jakarta-Singapore as it is a Malaysian carrier. Until we get a liberalised environment in the region, low-cost carriers will be confined predominately to country-specific routes,” argued Wickham.

And because most countries jealously guard their air traffic rights in a web of bilateral treaties, this has also stopped the type of cross-border investments and mergers seen in other industries like motor or shipping.

AirAsia’s joint-venture approach to circumvent the ownership issues, however, was “creative and interesting” said Wickham.

The relatively longer distances in Asia are also not conducive to the economics of low-cost flying. With flight times of four hours or more, the impact of low-cost carriers on established carriers is much less.

But on the shorter routes, however, analysts said, established national carriers like MAS might have to mimic the low-cost carriers.

Otherwise, they could lose out. Wickham worked out that regional low-cost competition would cost MAS 14% and Singapore Airlines 15% in revenue if they did nothing.

Change, it seems, would appear to be on the cards – perhaps with the passenger sacrificing that free meal or a couple of inches of legroom for cheaper fares.

“It’s becoming a commodity, more like a flying bus,” said one analyst, who said flying had become far less elitist.

After 100 years, the romance that is flying may not yet be dead, but these days, it is clearly in the hands of the number crunchers. And that’s a good thing too, for in time, maybe everyone can fly.

Air Asia is now going to Bangkok!!!!!!!

AirAsia to fly KLIA-Bangkok next month
By Ng Kar Yean, 10.59am

No-frills airline AirAsia Sdn Bhd expects to start flying to Bangkok from Kuala Lumpur International Airport (KLIA) from Jan 15 next year following the Transport Ministry’s approval for it to do so.
AirAsia chief executive officer Tony Fernandes told reporters last Saturday that he had been informed of the ministry’s approval, five months after the airline had submitted its application.

When contacted, a ministry official confirmed that a verbal approval had been communicated to AirAsia. “The approval letter will be sent to AirAsia in a day or two,” he told FinancialDaily.
Pending that approval to fly to Bangkok from KLIA, AirAsia has earlier decided to fly to Bangkok via Johor’s Senai Airport. It was scheduled to start the route from Senai Airport on a daily basis starting Feb 2 next year.

Last Saturday, the airline made its maiden regional flight from KLIA to Phuket.

AirAsia’s landing rights to Thailand came after Shin Corporation Pcl, which is controlled by Thailand’s Prime Minister Thaksin Shinawatra, bought a 51% stake in AirAsia Aviation Co Ltd, which conducts the Thai operations.

Fernandes said AirAsia would start with one flight daily from KLIA to Bangkok. Bookings would begin next Monday with fares starting from RM94 one way, he said.

He was speaking to reporters in Phuket after AirAsia’s official flight from KLIA to the popular tourist destination last Saturday.
“From the number of emails we have received requesting a KLIA-Bangkok flight, we expect the response to be good,” he said.
Since AirAsia started its maiden regional flight to Phuket on Dec 8, a passenger load of 77% has been achieved, he said. “This bodes well for the KLIA-Bangkok flight.”

Fernandes said AirAsia also had plans to fly to Bangkok from other airports in Malaysia.

He said it had been a “long battle” to get approval for the KLIA- Bangkok flight.

“As a new kid on the block providing low fare flights, it took a while to get the approval as the national airline (Malaysian Airline System Bhd) is dominating the domestic and international route,” said Fernandes.

Recently, Thailand’s telecommunications giant Shin Corp bought 20 million shares in AirAsia Aviation for 250 million baht (RM23.82 million).

The remaining 49% stake in AirAsia Aviation is held by AA International Co Ltd, which is under AirAsia

Here are some pics from Air Asia flights:

Labuan flight..but the one in the view is one of Sabah's islands
http://www.skyscrapercity.com/photopost/data/502/9airasia1.jpg
Not forest! But sea
http://www.skyscrapercity.com/photopost/data/502/9airasia2.jpg

:lol::lol::lol: it looks like forest than a sea..hehehe...that sea water must be very clear;)

Views near Putrajaya

http://www.skyscrapercity.com/photopost/data/502/9airasia3.jpg
http://www.skyscrapercity.com/photopost/data/502/9airasia4.jpg

Baq>r u encourage ppls to use Air Asia because u can have a nice view from the plan??:jk:;)

Originally posted by baqthier

Views near Putrajaya

http://www.skyscrapercity.com/photopost/data/502/9airasia3.jpg
http://www.skyscrapercity.com/photopost/data/502/9airasia4.jpg

looks like the whole area is u/c

Originally posted by TYW

looks like the whole area is u/c

only 30% of putrajaya was complete:)

Originally posted by Pablo

only 30% of putrajaya was complete:)

yeah, that's y looks u/c loh!!;)

Originally posted by TYW

yeah, that's y looks u/c loh!!;)

FYI ....those are not views of Putrajaya......could be Salak Tinggi ;)

Originally posted by szehoong

FYI ....those are not views of Putrajaya......could be Salak Tinggi ;)

what's FYI??:bash:

Originally posted by TYW
what's FYI??:bash:

FYI=For Your Information

Originally posted by liping_t

FYI=For Your Information

ooh, thanks:D

AirAsia to invest RM100mil in upgrade


AIRASIA Sdn Bhd, the airline which offers low price, will invest RM100mil to buy and lease aircraft in its efforts to upgrade its domestic and overseas flight service.

Its chief executive officer Tony Fernandes said the additional aircraft would enable AirAsia, which currently sees 11,100 passengers per day, to increase its flights to new domestic and overseas destinations.

He said AirAsia would have 30 aircraft, including five which would be bought by the end of next year.

“Negotiations with a number of companies are ongoing to get competitive prices,” he said.

He said this at a media conference after the inaugural flight from Johor Baru to Miri on Saturday. Sarawak Deputy Chief Minister Tan Sri George Chan Hong Nam and State Tourism Minister Datuk Abang Johari Abang Openg welcomed the 105 passengers including 30 local and Singapore media representatives.

Fernandes said that AirAsia targeted a 3.3 million increase in passengers next year, including from Singapore and Brunei.

He said that with the encouraging response, AirAsia would increase the flights from Kuala Lumpur to Miri and Johor Baru to Miri to five flights from three flights per day.

Currently, AirAsia flies from Johor Baru to Miri twice a day while from Kuala Lumpur only one flight per day.

Fernandes is confident that the additional flights would attract more tourists, especially from Brunei and Singapore to visit Miri and the peninsula.

"Currently, AirAsia flies from Johor Baru to Miri twice a day while from Kuala Lumpur only one flight per day."

This is so great! :cool:

Malaysian no-frills carrier AirAsia expects profits to triple this year

KUALA LUMPUR (Malaysia) Dec 24 - Amid plans to expand and become a regional airline, Malaysian budget carrier AirAsia expects to triple its net profit this fiscal year to 60 million ringgit (US$15.8 million), its chief executive said Wednesday.

The results underscore AirAsia's rapid rise in passenger traffic since its launch in December 2001 in a business gambit that made it one of the pioneers of low-cost air travel in Asia, which is expected to see several new cut-price carriers take off next year.

In recent months, AirAsia has tried to transform itself from a domestic carrier into a regional player. It began its first international route - to Phuket, Thailand - earlier this month, and plans to add other destinations in Thailand and Indonesia next year.

But, despite invitations from airports in Hong Kong, Macau and Hainan province, AirAsia is not aiming to establish routes into China - for now, said Tony Fernandes, AirAsia's chief executive.

``China certainly isn't on the map right now,'' Fernandes said in an interview with Dow Jones Newswires. ``We don't rush into things. It's taken us two years to do our regional flights.''

Fernandes said AirAsia would likely fly more than three million passengers in the latest fiscal year ending June 30, 2004, up from 1.45 million people the previous year.

He said talks with Richard Branson's Virgin Blue Holdings Ltd. concerning a possible linkup of flight schedules and sharing of crew were ongoing but ``still preliminary.''

AirAsia's success in enticing Malaysians with steeply discounted fares on domestic routes has helped encourage plans for other low-cost carriers in Southeast Asia, where similar airlines plan to begin flying next year in countries including Singapore, Thailand and Indonesia.

Meanwhile, AirAsia's new joint venture with Shin Corp., a Thai company controlled by the family of Thai Prime Minister Thaksin Shinawatra, is expected to start domestic flights from Bangkok in February, Fernandes said.

Probable destinations for AirAsia Aviation Co. Ltd. - which AirAsia hopes will carry a million passengers in its first year - include the Thai tourist hot spots of Chiang Mai, Hat Yai and Phuket.

AirAsia is also considering an initial public offering as a funding option to keep its operating costs low, Fernandes said, noting that a decision was expected by late January.

Carolyn Lim is a correspondent for Dow Jones Newswires.

Malaysia's AirAsia wins top aviation award


MELBOURNE Dec 31 - Malaysia's budget airline, AirAsia won the Centre for Asia Pacific Aviation's (CAPA) Airline of the Year award.

The fledgling airline shared the award with Australia's low-cost airline Virgin Blue.

CAPA said the two airlines, although operating in different environments, had spearheaded a new direction for the Asia Pacific airline industry.

"In just a few short months, last year's predictions that the low cost phenomenon had no place in this region have been overturned - and the industry will never be the same again," CAPA said.

THE LITTLE AIRLINE THAT COULD
By Maryann Tan

Who can resist a tale of an underdog who beat the odds to become Southeast Asia's - and arguably Asia's - first successful budget airline?

AirAsia's success at home, the coup it scored with its Thai joint venture and the pandemonium it caused north and south of Malaysia makes it the sexiest story this year.
Toss in talks of an impending listing on the Kuala Lumpur Stock Exchange and you've got the market's eyes glued on this newbie like a housewife on her Bollywood soaps.

"The market can't stop talking about it. Having experienced just traditional airlines, they want something new and different," says a Singapore-based analyst.

AirAsia has not ceased to excite the market from the day it announced its first net profit after only seven months of operations. For the financial year ended June 30, 2003, it netted RM30 million in profits. With the launch of its southern hub in Senai, Johor, the company expects to double that to RM60 million next year.

Even in a year fraught with calamities of war, terrorism and disease, AirAsia did not shelve its plans. While other airlines grappled with empty seats and grounded aircraft, the no-frills carrier continued to expand its fleet and increase its routes. It managed average loads of 80% on its planes at that time. This month AirAsia took delivery of its 10th Boeing 737 and celebrated the launch of its first regional flight to Phuket, Thailand.
By the first quarter of next year, its 49% owned joint venture with Shin Corp in Thailand will begin operations. That would allow AirAsia to fly to various destinations in Indochina and cities in the south of China. It has not been projected how many more passengers AirAsia will carry but it will be operating in a market of 70 million people where only 3% fly.

All this, while critics repeatedly doubted it could go beyond the domestic market.
"People were asking us if we were going to be around in three months when we first started," CEO Tony Fernandes told The Edge in an interview earlier this month.
If anything, AirAsia now gets the last word as it continues to influence the strategies at Asia's new low-cost carrier hopefuls.

Just days after Qantas launched its own no-frills carrier JetStar to challenge Virgin Blue, Singapore Airlines announced the launch of its own low-cost contender, Tiger Airways.

Charged with the role of leading the airline, former ground-handling chief of RyanAir Charlie Clifton has been hired as interim COO. As far as routes are concerned, Tiger has not said where it will fly to. Neither has it revealed the type of aircraft it will use.
At the same time, another Singapore low-cost outfit in ValuAir is scheduled to be operational in May next year.

"We don't worry about Lions or Tigers but the ability to successfully implement the low-cost model in Singapore," says Conor McCarthy, shareholder and adviser at AirAsia. "That requires appropriate costs at the airports and a freedom to operate our high-efficiency operations processes."
McCarthy insists that the doors for the much-talked about joint venture in Singapore is still open despite Temasek being one of the investors in Tiger.

In any case, the sprouting of low-cost airlines like fungi after a rainfall is good for AirAsia.

If Tiger can help in getting the Civil Aviation Authority of Singapore to reduce its charges on local flights, then we'll be happy," McCarthy says. "The Singaporean government has rightly identified the need to play in the low cost air travel market. Now we need to see that strategy reflected in the actions of the infrastructure providers."

As the race for market share intensifies, industry observers and consumers alike can expect a vibrant year ahead. Ultimately, competition will bring better services, greater choices and, more importantly, lower prices for the average Joe. Perhaps the governments of Asean may even consider expediting its long-term plans to open up the skies. And to think that all this may have come about because of a little upstart in Malaysia who dared to dream big.

Flight from JB!

LEATHER SEATS!!!!
http://www.skyscrapercity.com/photopost/data/502/9airasia11.jpg

AirAsia stewardess...they are way taller than MAS stewardesses
http://www.skyscrapercity.com/photopost/data/502/9airasia22.jpg

JAN 9, 2004
AirAsia sets sights on Macau
KUALA LUMPUR -- Malaysia's budget airline AirAsia has begun preliminary talks with Macau airport authorities over possible flights there, chief executive officer Tony Fernandes said on Friday.

'We had talks about three weeks ago with the Macau authorities. I will be surprised if we can do it this year. There is a lot of costing and feasibility work to be done,' he said.

'For now, we will concentrate on enhancing our domestic and regional routes,' he said, adding: 'The Macau airport authorities are prepared to talk. That attracts me.'

AirAsia, which flew its first regional route on Dec 8 to Phuket, plans to float some 25 per cent of its shares late this year to fund an ambitious expansion plan and fight off competition.

It begins to fly to Bangkok from Jan 15 out of Kuala Lumpur International Airport and from Senai Airport, in the south, in February.

AirAsia has said its initial public offering (IPO) would be issued 'as early as September 2004' and that it is looking at raising US$600 million to $1 billion.

The carrier took delivery of two Boeing 737-300 aircraft in October, increasing its fleet to nine, and it aims to have 22 aircraft by late this year.

It will fly to neighbouring Indonesia next month, the likely destinations being Surabaya and Denpasar with Medan at a later stage. -- AFP

Wow! So nice! The one I'm anticipating greatly is the HK one
:master:

AirAsia, Virgin Blue Airlines win award
KUALA LUMPUR, Jan 8:

Malaysia’s low fare, no-frills airline AirAsia has been named the “2003 Asia Pacific Airline of the Year” by the Centre for Asia Pacific Aviation (CAPA) based in Australia.
The title was jointly awarded to Virgin Blue Airlines and is given to airlines which create the most impact on the Asian Pacific airline industry during a particular year.

AirAsia chief executive officer Tony Fernandes in a statement today expressed his gratitude to passengers and staff.

"AirAsia would not be what it is today without the team spirit and tireless efforts of our staff. Our special thanks go to the Malaysian Government who has been very supportive since we first started.

"We will continue to strive for excellence and be a market leader in stimulating travel and tourism in the region," he said.

Notification of the award was posted on CAPA's website at www.centreforaviation.com.

From EDGE DAILY...

AirAsia seeks AOC in Singapore


AirAsia Singapore, a subsidiary of Malaysia’s premier low-cost carrier AirAsia will lodge an application for an Air Operators Certificate or AOC in Singapore this week, informed sources say.

AirAsia CEO Tony Fernandes and other senior executives were in Singapore last Friday putting final touches to the application, which sources say could be filed as early as Jan 15.

They reportedly met officials of Civil Aviation Authority of Singapore (CAAS) as well as key investors in the new airline.
An AOC will give the airline rights to fly out of Singapore to key Asean destinations. AirAsia is particularly keen to fly to destinations in Thailand, Philippines and Indonesia apart from Malaysia.

AirAsia is now finalising a shareholders’ list before it submits the application.

Aside from the parent company AirAsia, which will have a 49.9% stake in the company, other shareholders will be mostly Singapore investors.

Sources say that the private equity arm of Singapore’s dominant banking giant DBS Group will be one of the major shareholders.

Other investors include at least one large Singapore company and some private equity type funds.

These sources say Temasek Holdings, the investment arm of the Singapore government, which had previously been mentioned as a key shareholder in AirAsia Singapore, has decided not to take a stake in the new Singapore airline.

Temasek owns a controlling stake in Singapore Airlines which is setting up its own low-cost carrier Tiger Airways in partnership with investors that include the founding family of Ryanair, one of the world’s most successful low-cost carriers.

However, informed sources say Temasek is still negotiating to take a substantial stake in AirAsia’s Malaysian parent company as a strategic investor before AirAsia Malaysia lists on the KLSE in the third quarter.

Fernandes has reportedly met Madam Ho Ching, the executive director of Temasek, several times in recent months to thrash out the equity deal that could be announced within the next few weeks.

Informed sources say Fernandes is keen on having Temasek as a strategic partner in the Malaysian holding company because he feels Temasek could help open doors when AirAsia sets up in India and Indonesia, two countries where Temasek is expanding its portfolio and where it reportedly has excellent Guangxi (relationships/connections).

Sources say everything has been settled except for minor quibbling on valuations, but say both sides are fairly close to a deal.

Fernandes has said that although he would rather the airline list on KLSE in the third quarter of this year, he has not closed the option on an earlier listing taking advantage of the rally in regional equity markets.

Several large foreign investment banks have approached AirAsia to help with the foreign portion of the IPO, which could value the low-cost carrier between RM1.8 billion and RM2.5 billion.

The addition of strong strategic foreign partners like Temasek and a clearer strategy for Indonesia and India is likely to push valuations even higher.

The setting up of AirAsia Singapore is yet another prong in its Singapore strategy. AirAsia is still awaiting an official word on its application to use Seletar airport in Singapore for flights from key Malaysian destinations.

Fernandes has turned down an invitation to fly out of the costly Changi airport because of incredibly high airport taxes and charges.

Meantime, AirAsia continues to fly from Senai in Johor to KLIA and Penang.

Kiasu Singapore....

Singapore Land Transport Authority officially turned down AirAsia’s request for a direct bus service to Senai.

:bleep: >( >( >(

JB hotels gear up for expected influx of Thai tourists
By Chuah Bee Kim


--------------------------------------------------------------------------------

HOTELIERS in JB are gearing up for an influx of Thai tourists following the launch of AirAsia's direct Johor Baru-Bangkok flights via the Senai Airport on Feb 2.
Several major hotels here have already tied up room and tour packages with the budget airline, while others are hoping to cash in on the spillover through special publicity and promotions.

To date four hotels - Compact Hotel Johor Baru, Eden Garden Hotel Johor Baru, Puteri Pan Pacific Hotel Johor Baru and Sofitel Palm Resort - have started offering special packages in association with the airline.

"We hope to finalise the deals with the hotels by this Thursday," said AirAsia's senior manager senior manager Mimi Phua.


:) :) :)

http://www.channelnewsasia.com/stories/southeastasia/view/66125/1/.html

Thailand launches its first budget carrier - Thai Air Asia
By Channel NewsAsia Indochina Correspondent Sarosha Pornudomsak

-----------------------------------------------------------------
BANGKOK, Thailand: Thailand's first no-frills airline - Thai Air Asia - has been launched.

It's a joint venture between the kingdom's largest telecommunications operator Shin Corp and Malaysia's Air Asia.

Thai Air Asia will fly to 4 destinations within the country from the third of next month.

Its promotional rates will go as low as US$2.50 for a one-way ticket from Bangkok to popular resort areas like Chiang Mai, Phuket and Hat Yai.

These promotions will go on throughout the year, at intervals.

And even normal fares, executives say, would be at least 20 percent lower than those offered by domestic competitors.

Operating costs are lowered through the use of online bookings, and ticketless travel.

According to an optimistic forecast, it'll break even within the first 10 months of operations.

Thailand's domestic aviation industry carries about 7 million passengers a year, and this figure is expected to grow to 8 million this year.

The carrier expects to target Thais who've never flown before.

National carrier Thai Airways is fighting back by lowering its fares for destinations within Thailand.

And it's entering the no-frills fray.

Analysts say the national carrier will be launching a low-cost airline of its own within the next few months.

Thai Air Asia says it's ready for the competition.

Said its CEO, Tassapon Bijleveld: "We (Thai Air Asia) will definitely face it. We have a target of one million domestic passengers to carry and we will definitely focus on our end, on our operation to carry one million passengers."

Thai Air Asia will also fly international routes, with Singapore's Changi Airport its first international destination.

The company says its first flight is to Singapore is expected to take off as early as late March.

Air Asia's Chief Executive, Tony Fernandes, had wanted his Malaysian arm to be given discounts for landing at Changi Airport.

When he didn't get them, he chose Johor's Senai Airport as his Malaysian destination in the South.

But he's going ahead with landing his Bangkok flights at Changi - despite not getting discounts.

"We'll take Singapore from Bangkok for the moment. We still think Johor Bahru is a great place and our main growth will be in JB cause that's a low-cost airport," he added.

Air Asia says Indonesia could be the next ASEAN country it ventures into. - CNA

------------------------------------------------------------------------------

AIR ASIA to fly BANGKOK - SINGAPORE

By Yap Lih Huey, Edge Daily

Thai budget airline AirAsia Aviation Co Ltd has received Singapore’s approval to fly from Bangkok to Changi Airport and expects to do so by April.

However, it is still in negotiations with the Singapore authorities to reduce airport charges.

“Just got approval. We are the first low fare airline in Singapore,” AirAsia chief executive Tony Fernandes told Reuters by telephone text message in response to queries about plans for international services to the island republic.

Fernandes said the AirAsia service would involve seven flights per week from Bangkok to Changi Airport, starting from Feb 13.

However, Thai AirAsia Aviation chief executive officer Tassaton Bijleveld told reporters that AirAsia was looking at flying from Bangkok to Singapore by late March or early April.

“We want to fly to Singapore as soon as possible. The route is highly profitable as it generates one of the highest traffic in Southeast Asia,” he said at the official launch of Thai Air Asia in Bangkok.

He said AirAsia was still in talks with the Singapore authorities on the airport charges. He expected a more than 10% reduction in those charges. “We believe we can bring down the airport costs with Tony’s commendable negotiation skills,” said Tassaton.

Meanwhile, Jimmy Yeow reported that AirAsia Sdn Bhd could be eyeing a listing in the second half of next year.
Fernandes told reporters that the listing proposal would be submitted to its board next month.

“It is still in the early days and we are narrowing down the details to be presented to the board,” Fernandes said in Putrajaya on the sidelines of a dialogue between Prime Minister Datuk Seri Abdullah Ahmad Badawi and corporate leaders yesterday.

On how much the airline planned to raise from the IPO, he said: “It’s limitless — we are a small company and we are up against lots of competition — people with lots of money.”

Fernandes and a group of shareholders own a 74% stake in AirAsia through a company Tune Air Sdn Bhd, while Bahrain’s Islamic Development Bank, Bank Crescent Venture Partners from Saudi Arabia and Frankfurt’s Deucalion Capital hold the remaining 26% stake.

Fernandes also said the airline expected to handle 3.2 million passengers this year, up from 2.1 million passengers in 2003 and 1.1 million in 2002.

:) :) :) :) :)

AirAsia to fly to Bangkok


PETALING JAYA: Budget carrier AirAsia is scheduled to commence direct flights to Bangkok – its second regional destination – from KLIA and Senai Airport, Johor Baru beginning next month.

AirAsia has existing flights to and from Phuket, which commenced last month.

The new route will take off with the Johor Baru-Bangkok flight on Feb 3 followed by the Kuala Lumpur-Bangkok flight on Feb 9.

"Kuala Lumpur-Bangkok flight on Feb 9."

:bow::bow::bow:

Hope got hotel package also ler..

http://www.dailyexpress.com.my/news.cfm?NewsID=24253

Bid to make Labuan a hub for AirAsia

Labuan: HMD Tours and Travel, a tourism company here, has taken a forward step to develop Labuan into a “gateway” for tourists from Brunei by using budget airline AirAsia. “Presently the no-frills airline does not land in Brunei and as a result, travellers in the Sultanate are deprived of the opportunity to cheap airfare.

We have now tied up with two companies in Brunei to encourage Brunei travellers to use AirAsia services via Labuan.

“Under the arrangements made we would provide a complete package that allows the tickets to be bought in Brunei and use the fixed shuttle services for connections to AirAsia flights in and out of here,” HMD manager Raynie Mohd Din Jaffar told Daily Express after concluding the agreements in Brunei recently.

Raynie explained that under the first agreement with Brunei-based MegaBorneo Marketing Services, the company had been appointed to operate HMD Service Counter in Brunei.

The company would provide assistance to travellers who wish to fly on AirAsia. Brunei clients who do not have a credit card or access to the Internet can purchase tickets from MegaBorneo which will not only be responsible to promote the Labuan/Malaysia package but all other holiday packages.

Under the second agreement with another Brunei-based company, Interhill Industries has been appointed as the ferry service provider by using “Seri Anna” to transfer passengers from and to Brunei/Labuan. The company will also be responsible for groundhandling of passengers arriving or departing on AirAsia flights, at the Muara Terminal.

Raynie said presently AirAsia operates daily flights from here to Kuala Lumpur and it was likely that the number of flights would increase in the near future.

“We hope that with the facilities and services put in place, more people from Brunei would be encouraged to use Labuan as their transit point,” he said.

AirAsia tidak gentar untuk bersaing
Oleh Suffian A Bakar


AIRASIA Sdn Bhd (AirAsia) tidak gentar dengan persaingan yang bakal dihadapinya berikutan kemunculan beberapa syarikat penerbangan tambang murah serantau yang baru, kata Ketua Eksekutifnya, Tony Fernandes.

Bulan lalu, Singapore Airlines Ltd (SIA) mengumumkan akan melancarkan Tiger Airways yang menawarkan perkhidmatan penerbangan tambang murah bagi menghadapi persaingan daripada AirAsia.

Laporan sebelum ini menyebut Tiger Airways akan dikuasai SIA yang memiliki kepentingan ekuiti sebanyak 49 peratus; Indigo Partners LLC (24 peratus) dan Irelandia Investments Ltd (16 peratus).

Irelandia Investments Ltd adalah syarikat pelaburan Tony Ryan, pengasas Ryanair.

Tony berkata, AirAsia tidak melihat Tiger Airways sebagai satu ancaman kepada AirAsia.

“Kami akan memberikan mereka satu persaingan yang hebat.

“Sejarah sudah membuktikan bahawa apabila dua syarikat tambang murah beroperasi dalam pasaran yang sama, sebuah daripadanya terpaksa berundur kerana tidak berupaya menghadapi persaingan.

“Saya akan pastikan syarikat yang sebuah lagi itu bukan AirAsia,” katanya.

Tony berkata, perkhidmatan penerbangan tambang murah adalah bidang kepakaran AirAsia bersesuaian dengan matlamat asal penubuhannya.

“Wawasan syarikat itu adalah bagi menggalakkan lebih ramai pelanggan menggunakan pengangkutan udara, khususnya golongan yang berasakan pengangkutan udara adalah terlalu mahal bagi mereka,” katanya.

Beliau berkata demikian kepada pemberita sebelum pelancaran Thai AirAsia Co Ltd (Thai AirAsia) di Bangkok baru-baru ini.

Thai AirAsia ditubuhkan hasil usaha sama antara AirAsia dan AirAsia Aviation Co Ltd (AACL) yang membolehkan AirAsia menjalankan operasi domestik di Thailand.

Tony berkata, berikutan pelancaran Thai AirAsia, Bangkok kini menjadi pusat AirAsia selepas Senai dan KLIA.

“Dengan bertapaknya AirAsia di Bangkok, ia menjadikan penerbangan ke China menjadi lebih dekat lagi.

“Ia adalah sebahagian daripada pelan induk syarikat untuk menjadikan AirAsia syarikat penerbangan terunggul di Asia sesuai dengan namanya,” katanya.

Beliau berkata, pada masa sama pihaknya sedang berbincang dengan beberapa rakan kongsi di India bagi menjadikan negara itu sebagai pangkalan untuknya menyediakan khidmat ke negara Asia Barat.

“Usaha berkenaan juga dibuat sejajar langkah AirAsia yang sudah membuka pintu rundingan dengan rakan kongsinya di Sumatera, Indonesia untuk menjadikan lokasi berkenaan sebagai pusat ke pasaran selatan,” katanya.

Instant take-off for AirAsia’s joint venture
Zainul Ariffin and Azura Abas

KUALA LUMPUR, Jan 21:
--------------------------------------------------------------------------------

AirAsia’s joint venture with Shin Corporation of Thailand has proved an instant hit, with more than 20,000 seats on its domestic Thai routes sold within three days.
Sixty per cent of the bookings were made through the Internet, indicating how holiday planning has changed in recent years.

AirAsia, Malaysia's no-frills budget carrier, is being courted by other countries in the region such as Singapore and the Philippines, and has become a model Malaysian success story in just two years.

A group of investors, led by the carrier's chief executive officer, Tony Fernandes, bought the debt-ridden airline from DRB-Hicom for one ringgit more than two years ago and almost immediately turned it into a profit-churning venture, fashioning their business model on successful European budget airlines such as Ryan Air.

An exuberant Fernandes told the New Straits Times in a telephone interview from Bangkok today that the company's initial expectations had been "far exceeded".

"It just shows that the Malaysian way of doing things is well accepted in Thailand. We hope our success will be a good export story for other Malaysian companies to emulate." AirAsia's chief operating officer, Raja Mohd Azmi Raja Razali, said the numbers represented a good start for the joint venture, as February was usually a slow month for <a href="http://go-advertising.com?go=air+travel" onmouseover="window.status = 'goto: air travel';return 1" onmouseout="window.status=''">air travel</a>.

Thai AirAsia is AirAsia Aviation Co Ltd's subsidiary in Thailand, with 51 per cent of its equity owned by Shin Corporation and the rest by AirAsia.

AirAsia senior manager (purchasing and distribution) Bernard Francis said the high figures were a record for Thailand, which only recently introduced the cheap air fare scheme.

All seats were sold at the promotional price of Baht99 or RM9.90 for the Bangkok-Chiang Mai, Bangkok-Phuket, BangkokHaadyai and Bangkok-Khon Haen flights following the launch in Thailand.

The fare promotion for the 20,000 seats covers flights scheduled between Feb 3 and 29.

AirAsia will operate flights between Kuala Lumpur and Bangkok, while Thai AirAsia will fly between Bangkok and Johor Baru from next month.

Half of the seats available for the Kuala Lumpur-Bangkok-Kuala Lumpur route for February were sold within six days of bookings being opened. The flights begin on Feb 9.





:cheers: :cheers: :cheers: :cheers: :cheers: :cheers:

IPO for AIRASIA?

On Jan 13, Fernandes said AirAsia's board of directors would meet next month to discuss the possibility of floating the company on Malaysia Securities Exchange Bhd.

"If the listing exercise takes place this year, we will make the initial public offering either in September or November."

The old or new livery.......which one did u like?

http://www.savepic.com/freepicturehosting/is.php?i=61076&img=323161.jpg

http://www.savepic.com/freepicturehosting/is.php?i=61077&img=AirlinersNetPhotoID182477.jpg

http://www.savepic.com/freepicturehosting/is.php?i=61078&img=AirlinersNetPhotoID310684.jpg

The new one of course! Less color but more photogenic :)

Business Times - 04 Feb 2004


Thai AirAsia starts services

(BANGKOK) Thai AirAsia Co started commercial flights yesterday without incident or seat cancellations a day after the budget carrier's first demonstration flight for the media was aborted because of an indicator malfunction.

'We received 40 to 50 calls from passengers but luckily there was no cancellation,' said Tassapon Bijleveld, chief executive of Thai AirAsia.

Thai AirAsia is a venture between Shin Corp, owned by Thai Prime Minister Thaksin Shinawatra's family, and Malaysia's AirAsia Sdn, Southeast Asia's first low-cost carrier. The company, which is starting operations with two used Boeing 737s leased from its Malaysian parent, plans to have about eight aircraft by year-end.

Monday's incident has not affected the company's plan to fly about 1 million passengers in Thailand this year, Mr Tassapon said. The airline's first flight, to the northern city of Chiang Mai, departed from Bangkok on time at 7.25 with about 110 passengers, about 70 per cent of the available 148 seats, he said. All six flights scheduled for yesterday have booked passenger loads of 60 to 70 per cent, he added. - Bloomberg

FEB 12, 2004
AirAsia, S'pore partner to set up budget airline

SINGAPORE -- No-frills Malaysian carrier AirAsia announced on Thursday it will start a joint venture airline in Singapore, intensifying competition in a new niche industry already crowded with regional players.

AirAsia Chief Executive Tony Fernandes said the venture - with a Singaporean partner he declined to disclose - will be worth some S$120 million (US$72 million).

The new venture will initially offer services to six destinations using two planes but will eventually have three planes offering 18 to 32 flights a day, Mr Fernandes said.

He said he applied to Singapore's Civil Aviation Authority for an air operator's certificate three weeks ago. It could take six to nine months to get the approval and the airline cannot fly until then, he said.

Two other low-cost rivals - Singapore Airlines' budget spin-off Tiger Airways and ValuAir, run by former SIA executives - are also slated to begin operations this year.

AirAsia is currently trying to service the Singapore market with two daily flights between Kuala Lumpur and Senai airport in Malaysia's Johor state, which neighbours Singapore. Passengers have to take a shuttle bus from Singapore to Johor.

AirAsia Thailand, a tie-up between the Malaysian carrier and Shin Corp, a company owned by the family of Thai Prime Minister Thaksin Shinawatra, has already started operating flights between Singapore and Bangkok with promotional one-way fares of $50, one-eighth of regular fares. -- AP

boy..Tony Fernandez is one smart fella, he's found a creative way of getting round all these air right's issues! Genius! Can't wait till he takes his company public! I think he's gonna be the budget airline industry Star Cruises.

Ah I got this from Malay Mail Print edition...still can't find it online sigh!

"AIR ASIA THE BEST IN ASIA PACIFIC"

was tops on Boing's list for having the best ultilisation and dispatch reliability amongst players in the airline industry.

Asia pacific Airline of the Year 2003 CAPA (Centre for Asia pacific Aviation) at singapore. jointlyshared with Virgin Blues.

Originally posted by hypermount

Ah I got this from Malay Mail Print edition...still can't find it online sigh!

"AIR ASIA THE BEST IN ASIA PACIFIC"

was tops on Boing's list for having the best ultilisation and dispatch reliability amongst players in the airline industry.

Asia pacific Airline of the Year 2003 CAPA (Centre for Asia pacific Aviation) at singapore. jointlyshared with Virgin Blues.

wei...this one old news liao lah.....someone posted that online a few weeks ago lah :D

Okay I thought it was new LOL. Malay Mail mah.

Originally posted by hypermount

Okay I thought it was new LOL. Malay Mail mah.

And you tot Malay Mail is so 'updated'! :D

No-frills airline Air Asia Sdn Bhd has opened another channel for air travellers to pay for flight tickets booked via telephone at Pos Malaysia Bhd’s 600 branches nationwide.

In a statement last Friday, Air Asia said the payment for tickets booked via Air Asia’s Nationwide Call Centre would have to be made within 48 hours.

Travellers need to request and fill “Pos Akaun 39” forms at Pos Malaysia, stating booking reference number, contact number and amount payable before effecting payment.

A copy of the “Pos Akaun 39” form would be given as a receipt. Pos Malaysia charges a RM2.50 fee the service. Air Asia accepts flight bookings via phone, SMS and the Internet.

Seized in the most globalized city ;)
http://www.brunei-online.com/bb/thu/mar4w2.htm
From Borneo Bulletin

AirAsia shuttle buses seized

SINGAPORE (AP) - Singapore said Wednesday that it has seized two buses used by Malaysian budget carrier AirAsia to ferry passengers from the city-state to an airport in southern Malaysia.

The carrier was authorised to use the buses only for chartered sightseeing tours, the Land Transport Authority said in a statement.

But the buses had been shuttling passengers from Singapore to Senai Airport in the southern Malaysian state of Johor - about an hour's drive away from the island state.

The no-frills carrier flies twice daily between Senai and Kuala Lumpur. "LTA has escorted both buses back to its office for investigation and has taken statements from the drivers," the statement said.

An LTA spokeswoman, who asked that her name not be used in line with standard authority practice, said the buses were impounded after officials noticed AirAsia was offering the shuttle service on its Web site.

AirAsia does not fly out of Singapore's Changi Airport because it says the charges are too high, although a subsidiary has flights from there to Thailand.

The Straits Times said the airline had applied for a licence to run shuttle buses, but was turned down. No reason was given for the rejection but critics say it is part of the government's efforts to protect Changi from increasing competition, the report said.

AirAsia Thailand, a joint venture between the Malaysian carrier and Shin Corp., a company owned by the family of Thai Prime Minister Thaksin Shinawatra, operates flights between Singapore and Bangkok.

Singapore is going to be a major battle ground for AirAsia methinks....what with ValueAir and Tiger Airways starting their routes soon!

AirAsia adds second daily Singapore-Bangkok flight



SINGAPORE: AirAsia will add a second daily Singapore-Bangkok flight service due to strong demand since launching the route less than a month ago, said the Malaysian low-cost carrier.

The new service, to begin on March 28, would arrive in Singapore from the Thai capital in the evening at 9:10pm and depart at 11:59pm, founder and chief executive Tony Fernandes said at a news briefing yesterday.

“We are responding to demands of the public,” Fernandes said.

“With the added frequency, this means more choices, more convenience, and added value for our guests.”

AirAsia will charge a promotional fare of S$23.99 for a one-way ticket to mark the launch of the additional flight.

It began the Bangkok-Singapore service last month, becoming the first to offer ultra-cheap fares on the lucrative route. – AFX-Asia

"S$23.99"

Damn cheap!!! :cry:

Qantas eyes Asia for budget air service
Peter Morley
28feb04
QANTAS is looking to South-East Asia to establish a discount airline similar to its new domestic low-cost carrier, Jetstar.



A Qantas source – buoyed by the huge demand for scheduled as well as $29 promotional seats Jetstar will offer from May 25 – said: "Don't be surprised if you see us open a discount airline in another place – South-East Asia".

"The matter is under very serious consideration. I will not go into too much detail but it is highly likely that Jetstar is not the only low-cost airline that we find ourselves associated with."

The high-level source said Qantas had to grow or "just sit on its backside and become a utility".

"Those at the top are determined to grow the airline, make it stronger and seize the opportunities available to it," the source said.

"We have a wonderful reputation around the world and we are sought after all around the world."

Since Jetstar announced it would fly from Brisbane, Sydney and Melbourne to 10 eastern state destinations, travellers have snapped up nearly all the promotional $29 fares the new airline's entry generated.

While Jetstar offered 100,000 seats for travel between May 25 and June 30, rival low-cost carrier Virgin Blue countered putting 200,000 seats on at the same price but for travel from May 1 to June 30.

"Welcome to competition," Virgin Blue chief executive Brett Godfrey said when flamboyantly announcing that his hugely successful airline would "match Jetstar's 100,000 and raise you 100,000".

Last night, the only $29 flights still available with Jetstar were Brisbane to Mackay, Rockhampton and Newcastle. Virgin Blue was still offering Brisbane to Melbourne, Newcastle and Mackay.

With flights costing less than the average taxi fare to Brisbane Airport, both airlines were confident they would sell out today.

So what happens with fares from June 30 when the introductory and counter offers end and both airlines go head to head while Qantas continues to operate some of the routes the low-cost carriers are fighting over?

The Courier-Mail yesterday checked fares the three airlines are offering on the Internet and found the lowest was Jetstar, which says it has taken more than 20,000 bookings at everyday rates.

Although Internet fares can change according to demand, Brisbane to Hobart flying Jetstar on July 11 was quoted at $149, Qantas $195 and Virgin Blue $220.

Travel on the same day from Brisbane to Cairns was listed at: Jetstar $119, Qantas $150 and Virgin Blue $159.

Jetstar will charge $89 for travel to Mackay on July 15, Qantas $102 and Virgin Blue $149.

On September 20, a Brisbane to Melbourne (Avalon Airport) flight on Jetstar will cost $99, $149 on Virgin Blue and $190 on Qantas. Virgin Blue and Qantas land at Tullamarine, much closer to inner Melbourne.

Jetstar maintains that these fares will continue to be their everyday rates and are not another promotional start-up stunt.

If this is the case, then Virgin Blue will have to review its fares downwards because it has declared it will not be beaten on price.

Qantas mulls new budget airline


AFP , SYDNEY
Saturday, Mar 20, 2004,Page 12
Australian flag carrier Qantas is considering teaming up with Malaysia's AirAsia to form a Singapore-based, low-cost airline servicing the booming Southeast Asian market, it was reported here yesterday.

News Ltd and Fairfax newspapers reported Qantas Airways Ltd was considering the move as a back-up if regulators blocked a proposed tie-up with Air New Zealand.

The venture would challenge archrival Singapore Airlines on its home turf.

Qantas already had a license to operate a discount airline from Singapore that was granted more than 10 years ago after negotiations on access to Australian airports.

Melbourne's Herald-Sun said Qantas had already completed a feasibility study on running a low-cost airline from the Asian city-state while the Sydney Morning Herald reported Irish aviation consultant Conor McCarthy was brokering a deal between Qantas and AirAsia.

The reports said it was not clear whether Qantas would buy a stake in AirAsia, which is expected to hold a public float later this year, or the airlines would form a joint venture for the Singapore project.

"It would certainly be a positive move for Qantas," Centre for Asia-Pacific Aviation managing director Peter Harbison said. "There's massive potential in that market."

Harbison said AirAsia appeared to favor the joint-venture model when doing business with other airlines.

"It wouldn't surprise me if they went down that track, it would help entrench AirAsia positively in the market," he said.


Aussie stamp of approval! This is a great example of what open competition can do, and what M'sians are capable of!!

Hold your horses, aussie media! :D

Latest News | Updated March 22, 1.05 pm (Singapore time)

Qantas has 'no licence to run budget airline'

SINGAPORE - Singapore says Qantas does not have a licence to run a low cost airline out of the Republic, contrary to Australian media reports that it had been given the go-ahead more than 10 years ago. Transport Minister Yeo Cheow Tong said they don't have the licence at the moment.

Australian media reports also said the carrier was considering teaming up with Malaysia's AirAsia to form a low-cost airline to be based in Singapore to serve the lucrative South-east Asian market with a population base of more than 500 million people. It was reported the move was a backup plan for Qantas if regulators blocked the carrier's proposed tie-up with Air New Zealand.

AirAsia has confirmed Qantas is among the carriers it is in talks with for possible joint ventures to expand its regional presence but executive director Kamarudin Meranun declined to comment on the Australian media reports.

The Malaysian budget carrier has applied for an air operator's licence from the Singapore government to operate from the city-state but this has not yet been approved. It has already roped in at least one Singaporean partner for the proposed carrier.

Under current local civil aviation regulations, a carrier based in the Republic must be majority-owned by a Singapore partner. -- AFP

Malaysia AirAsia Plans Macau Flights By End-May - Source

KUALA LUMPUR (Dow Jones)--AirAsia Sdn. Bhd., a Malaysian low-cost carrier, plans to start flying to Macau, China by the end of May, an official close to talks between AirAsia and the Macau International Airport said Friday.

"They are discussing the details. There are plans for scheduled flights by the end of May," the official told Dow Jones Newswires on condition of anonymity.

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"This is still at the planning stage, so it's not reasonable" to speculate what the flight frequencies will be, the official said.

A Xinhua news agency report Friday said AirAsia will have once daily flights between Kuala Lumpur and Macau, and between Bangkok and Macau.

The official declined to confirm the reported flight schedules.

AirAsia has a Thailand-based joint venture with Shin Corp. (SHIN.TH) undertaking domestic flights within Thailand and international flights between Bangkok and Singapore.

AirAsia also flies to Bangkok and several regional points from Kuala Lumpur.

Officials from the airline and Macau airport declined comment

http://sg.biz.yahoo.com/040402/15/3j8d0.html

AirAsia to fly to Indon cities from next week

BY NG CHENG YEE
BANGKOK: AirAsia will fly to three destinations in Indonesia beginning next week, its group chief executive officer Tony Fernandes said here.

The inaugural flight to Bandung, Indonesia, will depart from the KL International Airport on April 12 and the flight to Surabaya on April 15.

The airline will also fly to Jakarta from the Senai Airport on April 10.

Asked if AirAsia would add routes to China and India, he said the airline would consider it but would not operate the flights from its Malaysian base as it was too far from these two countries.

He said the Malaysian base would focus on its flights to Indonesia while its Thai base would be the potential base for these new routes.

Fernandes said at the Queen Sirikit National Convention Centre here recently that AirAsia passengers would enjoy better and safer services now that it had awarded a nine-year contract for the maintenance of its 16 aircraft engines to US-based GE Aircraft Engines.

The contract, valued at more than US$50mil (RM190mil), was set to improve AirAsia's aircraft reliability, he said.

“A flight will not be smooth without a good engine and the partnership of AirAsia with GE will ensure good maintenance of our engines,” he said.

GE Aircraft Engines is currently maintaining 12 CFM56-3 series engines that power AirAsia's initial fleet of six Boeing 737-300 aircraft under a partnership agreement signed in 2002.

The maintenance and overhaul work will be conducted by GE Engine Services Malaysia Sdn Bhd at the Sultan Abdul Aziz Shah Airport in Subang.

GE South-East Asia president Stuart L. Dean, who was present at the agreement signing ceremony, said the collaboration would lower aircraft operating costs and maintain the high quality and safety of aircrafts.

About AirAsia's attempt to find an sg partner here:

DBS open to venture with AirAsia

By Karamjit Kaur

DBS Bank is open to taking a stake in a joint venture airline with Malaysia's AirAsia, but remains mindful that its main role is to focus on its core banking business. Speaking to reporters at the launch of the DBS-AirAsia credit card yesterday, the bank's vice-chairman and chief executive officer (CEO) Jackson Tai said if AirAsia starts a Singapore-based carrier, DBS would like 'to be a part' of it.

The airline, which started a carrier in Bangkok - Thai AirAsia - with Thailand's Shin Corp, has applied to the Civil Aviation Authority of Singapore (CAAS) for an air operator's certificate.

DBS could become a shareholder in the new airline, said Mr Tai, but regulations set by the Monetary Authority of Singapore (MAS) 'limit how much we can take by way of private equity'. He did not divulge details, except to say that banks can invest in non-core businesses provided they set aside a stipulated amount in capital reserve.

Another more viable option is to support AirAsia in looking for finance. Mr Tai said: 'Our main role (as a bank) is in matching people who have money and those who need money...and to find for our customers the best, cheapest and most advantageous terms.'

He made it plain several times during the joint press conference with AirAsia that DBS is gunning to be the lead bank for the airline's upcoming initial public offering (IPO) exercise, due to happen in September.

To this, AirAsia CEO Tony Fernandes would only say that the bank may be 'involved in some role'. AirAsia has already appointed Credit Suisse First Boston, RHB Sakura Merchant Bankers and BBMB Securities to help manage its proposed IPO.

Both Mr Fernandes and Mr Tai met the local and Malaysian media after the launch of the new credit card at the Rouge, a pub in Orchard Road. The Mastercard allows users to redeem flights on AirAsia through a frequent flier programme.

At yesterday's event, Mr Fernandes also updated the media on the status of bus services from Singapore to Senai Airport in Johor. To date, the Land Transport Authority has not approved a direct link between the two points, so AirAsia is planning to offer free bus services to take travellers to Senai.

This is so that travellers can board flights to AirAsia destinations that are not served from Singapore.

And just for the sake of updates with regards to the "Qantas-AirAsia" rumour:

Qantas, Temasek to set up budget airline

SINGAPORE - Australian national carrier Qantas announced here on Tuesday it will team up with Temasek Holdings in a budget airline venture to be based in the Republic and service the booming Asian market.

Qantas chief executive Geoff Dixon said his airline would have a 49.9 per cent stake in the no-frills carrier, while Temasek will own 19 per cent. Mr Dixon said Qantas would contribute $50 million to the venture, which would have a total investment of $100 million.

'This is a modest investment for Qantas but it is an excellent opportunity to participate in the growing intra-Asia travel market,' Mr Dixon said in a statement.

'The region, which has a population of more than three billion people, is enjoying strong economic growth and features many potential destinations for point-to-point travel from Singapore.' Mr Dixon said the airline would fly to Asian cities within five hours from Singapore.

The statement said Singapore businessman Tony Chew would have a 21.1 per cent stake, while another Singaporean, FF Wong, would own the remaining 10 per cent.

AirAsia pressing on to Singapore

BY K.P. LEE
DO four airlines make a crowd? The announcement by Australia’s Qantas Airways on Tuesday that it planned to establish a regional budget airline in Singapore – making it the fourth aspiring start-up there in less than a year – has left fellow-contender AirAsia stirred up, but decidedly not shaken.

AirAsia chief executive officer Tony Fernandes brushed aside the competitive threat to the airline in the increasingly crowded Asian skies and said it would still proceed with plans to build a Singapore base despite the bigger financial muscle of some of its potential rivals.

“No, there’s no change to our expansion plans,” he told StarBiz in a phone interview yesterday. The low-cost carrier, which recently expanded to Thailand with a 49% joint venture, sought an air operator’s licence from Singapore’s Transport Ministry after the island republic opened its skies to low-cost airlines.

Apart from AirAsia, incumbent Singapore Airlines’ 49%-owned low cost unit, Tiger Airways, and privately-owned Valuair all hope to take off before the year-end.

Until recently, Qantas was reported to be in talks to acquire a stake in AirAsia. But the potential suitor turned rival when it announced on Tuesday the setting up of a S$100mil Singapore-based low cost airline – likely to be known as Jetstar Asia – in which it will own 49%.

Even if obtaining a licence from Singapore was uncertain, Fernandes said AirAsia was also building a base at Senai Airport in Johor Baru, where “we will watch the enduring fight between the kangaroos and tigers,” referring to the two major airline-backed low-cost carriers.

Fernandes also revealed, for the first time, that there had been an offer on the table by Qantas to buy a significant stake in AirAsia. It was rejected because of “cultural differences,” he said.

“The way they worked would have slowed us down, and eventually killed us. I didn’t think it would work out,” he said.

On other potential investors like the oft mentioned Britain’s Virgin group and its Australian unit, Virgin Blue, Fernandes said: “We have a close relationship and share cultural similarities but it does not mean there will be equity participation. Anyone coming in has to add strategic value.”

Aviation analysts said the increasingly crowded skies could well close down even before they were established.

Philip Wickham, a Hong Kong-based aviation analyst for ING Financial Markets, said yesterday the chances of all four airlines surviving were very slim. “We view the likelihood of Singapore having four budget airlines operating by the end of 2005 as virtually nil.

“The likely outcome is that two or three of the low-cost carriers will cease operations and be acquired after several months of competition. However, determining which of the four budget airlines will eventually emerge is difficult currently,” he said.

Fernandes agreed with the analysis, but said that of all the airlines which had applied for licences only one – Air Asia – had proven experience in running a low-cost carrier.

“For the others, these are non-core businesses ... speculative gambles really,” he said.

AirAsia’s 17th Boeing arrives


SEPANG: A Boeing 737-300, emblazoned with the signature of AirAsia and the cartoon characters of Lat, touched down to a warm welcome at the KL International Airport here yesterday.

It arrived from Singapore after undergoing extensive refurbishment by ST Aerospace Engineering.

“The engineers have put in a tremendous amount of work to get this plane ready for use,” said AirAsia group chief executive officer Tony Fernandes after the welcome reception for the airline's 17th Boeing.

Present at the reception were popular nasyid group Raihan and cartoonist Datuk Mohd Nor Khalid, who Malaysians know as the affable Lat.

http://www.thestar.com.my/archives/2004/5/22/nation/p26airasia.jpg

Cartoonist Datuk Mohd Nor Khalid or popularly known as Lat (fifth from left) posing with AirAsia's 17th aircraft during the welcoming ceremony of the Boeing 737-300 at KL International Airport (KLIA) yesterday. With him are AirAsia group chief executive officer Tony Fernandes (third from right), pilot Koay Cheng Thye (sixth from left) and members of the nasyid group Raihan (extreme left and right).

Kinda cute seeing Lat's cartoon characters on the plane! :okay:

AirAsia pressing on to Singapore
Now this is HUGE!!! :D

Any updates about this particular development?

The Straits Times
11 June 2004

AIRASIA 'PLANS TO BUY 80 PLANES'

FAST-GROWING Malaysia-based budget carrier AirAsia will ask plane makers to make an offer to sell it 80 airplanes, an industry source said yesterday.

'AirAsia is going to submit a request for proposal to Boeing and Airbus for 80 aircraft,' the source said, adding that the carrier would buy from only one supplier.

AirAsia currently operates a fleet of Boeing 737s. Globally, budget carriers typically fly 737s or Airbus A320s. -- Reuters

Friday June 11, 2004
AirAsia may get slice of local operations

BY B.K. SIDHU

Part of the domestic air services currently operated by Malaysia Airlines (MAS) on behalf of the Government may land in the hands of budget carrier AirAsia, sources said.

Preliminary discussions took place between officials of AirAsia and the Finance Ministry before the general election but no decision was made then. Although no party has put forward a proposal, the idea is believed to have been mooted by the Government.

It is learnt that at the talks, AirAsia had expressed readiness to provide additional capacity on its domestic services and indicated willingness to buy aircraft from the Government for that purpose.“The idea put forth was for MAS to reduce its capacity on some routes and re-deploy it to AirAsia,’’ a source said, citing as example Langkawi, to which MAS currently operates six flights a week. The frequency, he said, could be reduced to two for MAS, with the other four re-deployed to AirAsia.

In such a scenario, MAS would still fly to a particular domestic destination to provide linkage for its international passenger and cargo operations, but at a lower frequency.

However, a final decision on whether the domestic operations should come under AirAsia’s purview has yet to be made.

“AirAsia is always open to any proposal in which Malaysia can win and both AirAsia and MAS can build stronger brand names in the region. But we believe no firm proposal has yet been submitted,'' the source said.

Under the widespread asset-bundling exercise undertaken by MAS some two years ago, the Government, via Penerbangan Nasional Bhd (PNB), took over the airline's domestic operations, which were said to be loss-making and heavily subsidised by its international operations.

MAS was left to manage the international operations but still handled the domestic business under a three-year agreement which provided that it leased aircraft from PNB for its services. The national carrier has been on an expansion trail for its international operations since then, introducing flights to new destinations while increasing frequencies to existing places. MAS has said it would add provincial towns in various countries such as Kolkata, Coachin and Ahmedabad, Chengdu, Wuhan and Kunming to its international destinations.

Giving AirAsia a bigger role in the domestic airline operations would undoubtedly help MAS as it could then concentrate on building up its international business further.

Recently, the Government also announced that it wanted Malaysia to be an aviation hub for the growing regional budget airlines sector. It is looking at either building a new terminal at the KL International Airport or even converting the Sultan Abdul Aziz Shah Airport in Subang.

Such a move would be in sync with its thinking on letting AirAsia manage the domestic operations and it would certainly be a practical idea to move those operations to Subang, a source said.

Eventually, if the plan works, MAS would remain a full-fledged service carrier which flies international routes but still provides basic linkages to domestic points. And AirAsia provides real point-to-point linkages domestically.

Meanwhile, Reuters quoted sources as saying that AirAsia would ask aircraft manufacturers to make an offer to sell it 80 aircraft.

“AirAsia is going to submit an RFP (request for proposal) to Boeing and Airbus for 80 aircraft,” a source said, adding that the carrier would buy from only one supplier.

At present, AirAsia has 18 aircraft and a fleet of 80 is said to be too large for a budget airline. But that may be its very long-term plan.

But if it were to take over part of MAS's domestic operations, it would need only 20 to 25 more planes immediately. MAS currently operates 100 aircraft, of which over 30 are for services to 32 domestic destinations.

Source: The Star

AirAsia targets 8 million passengers

AirAsia is confident of more than doubling the number of passengers it carries to nearly eight million in 2005 compared with a forecast in May of six million, chief executive Tony Fernandes said.

The airline carried 1.8 million passengers last year and the figure is forecast to rise to at least 3.2 million this year.

Fernandes, in Singapore to sign a maintenance contract with a local firm, said he expected the number of passengers to rise to just short of eight million next year.

He said his forecasts were based on strong demand for new flight routes offered by the carrier to regional cities such as Macau.

We have seen the demand for our services so far. There is a big market out there, Fernandes told reporters after the contract signing with ST Aerospace.

AirAsia began servicing the Malaysian market in 2001 and has rapidly expanded with routes to Indonesia, Thailand, Brunei, Singapore and Macau.

Fernandes also said a decision was likely to be made over the next two months on whether to pick Boeing or Airbus to supply 80 new planes. We're happy with both the offers, he said.

Both of them have an equal chance of getting this order. We hope to have the first plane in 2005 or 2006 ... it depends on the delivery schedule of Boeing and Airbus. AFX-Asia

Wow.....what a great news! Imagine... 8 millions passengers, 80 planes to order within 3 years! AirAsia is indeed a great story not only in Malaysian aviation industry but also in Asian or World.

:applause: :applause: :applause:

Heard the rumors that AIRASIA will fly to Perth via Indonesia cities. I hope it is true. MAcam ni boleh balik kampung selalu!! :)

DENPASAR (indo.com): Air Asia will fly Bali route to take advantage of the holiday season in the Island of Gods in August. Bali will witness the increasing number of visitors in August as students in many countries are on holiday.

Following the successful launch of three routes connecting Indonesia with Malaysia, Air Asia has signaled plans to establish an additional seven new routes by the end of 2004.

Air Asia's Country Manager, Abdul Nasser Abu Kassim said that the carrier will provide new flight services in July. They include Jakarta - Kuala Lumpur, Bali - Kuala Lumpur, Medan - Kuala Lumpur and Makassar - Johor Bahru. By the end of 2004 Air Asia will introduce three additional new services to Padang and Palembang (Sumatra), and Yogyakarta, Bali Discovery reported.

http://www.airasia.com/adGallery/enAd/English_Advertisements/20040701.jpg

Heard the rumors that AIRASIA will fly to Perth via Indonesia cities. I hope it is true. MAcam ni boleh balik kampung selalu!

Yeap, via Jakarta and Bali, they also targetting australian tourists and Malaysian/Indonesian students.

cheers

AirAsia flies to Bintulu


Low-fares airline AirAsia Sdn Bhd has added Bintulu as a new destination in Sarawak starting Aug 30 while boosting frequencies to Kuching, Miri and Sibu.

It said in a statement it was introducing a seventh daily flight to Kuching, a third daily flight to Miri and a second daily flight to Sibu at the end of next month. All flights would depart to or from its hub in Kuala Lumpur International Airport.

Edgedaily.

Apa macam....cun tak?
http://www.savepic.com/freepicturehosting/is.php?i=214169&img=18pgair.jpg

AirAsia may fly to Kunming and Chengdu by year-end


BY K.P. LEE
AIRASIA, encouraged by the success of its new Macau flights in attracting Chinese travellers, is hoping to be the first low-cost carrier to fly into mainland China. It wants to add Kunming and Chengdu to its growing list of regional destinations by the year-end.

The airline said it had begun preliminary talks with the Chinese authorities for direct services to both cities from Bangkok, hub of its 49% associate Thai AirAsia.

Kunming and Chengdu are also two of the latest Chinese destinations being planned by Malaysia Airlines; but it is believed that an AirAsia service from Kuala Lumpur would be unlikely, as the distances involved would prove uneconomical for its fleet of Boeing 737-300s.

An AirAsia spokesperson said yesterday the daily Bangkok-Macau flights that started in June had exposed the airline to the burgeoning tourist traffic from China, which already accounted for a sizable 20% of the passengers on the route.

Its chief operating officer, Raja Mohd Azmi Razali, was quoted by AFP over the weekend as saying that he was confident the series of talks the airline had had with Chinese officials would result in an agreement for flights to be mounted by the year-end.

“Don't be surprised we can be in China in the next few months,” he said.

Even so, traffic rights for the lucrative leisure routes to and from China would be difficult to obtain, said an aviation analyst; but if successful, AirAsia would make history by being the first low-cost carrier to fly to the Chinese mainland.

Raja Azmi said the new destinations could help generate interest in the company’s initial public offering, which would probably be delayed to October, from September originally.

http://www.savepic.com/freepicturehosting/is.php?i=214169&img=18pgair.jpg
erm, yang aku naik pegi jb and labuan last time lebih cun! :D

AirAsia Offers More Flights To Haadyai


KUALA LUMPUR, Aug 4 (Bernama) -- No frills airline AirAsia, is scheduled to commence flights between Haadyai, Southern Thailand's largest city, and Kuala Lumpur on Aug 5, 2004.

Haadyai would become the third Thailand destination operated by AirAsia after Phuket (in November 2003) and Bangkok (February 2004), the low fare airline said in a statement released, here Wednesday.

It said that the airline currently connects Bangkok to many local destinations in Malaysia, namely Johor Baharu (Singapore), Kota Kinabalu, and the newly launched flights to Penang.

At present, AirAsia serves Haadyai via its Bangkok - Haadyai flights, which are operated by its associate company Thai AirAsia.

Thai AirAsia, which began operations in February 2004, had carried over half a million guests in just five months while AirAsia itself had carried over five million guests since December 2001.

Initially, there would be one daily flight connecting Kuala Lumpur and Haadyai with low fares from RM69.99/THB700 (applicable for one way travel only and excludes airport taxes and fees).

In conjunction with the launch of the airline's new schedule for November 2004 to June 2005, it said that guests may take advantage of even lower fares from RM29.99/THB300 one way, for the new KL- Haadyai service.

However, these promotional fares are only applicable for bookings received over the Internet at www.airasia.com.

Departure/arrival time for KL-Haadyai is 1405/1415 on flight AK 862 while for Haadyai-KL 1440/1645 on flight AK 863.

AirAsia presently serves Haadyai via its Kuala Lumpur-Alor Star service and it takes an hour from Alor Star airport to Haadyai city centre.

In anticipation of AirAsia's inaugural flight to Haadyai, the airline had organised a special flight, which landed today and greeted by Governor of Songkhla province Somporn Chibangyang and Thai AirAsia chief executive officer (CEO) Tassapon Bijleveld.

On board the official flight were Datuk Mohd Azmi Razak, secretary-general of Ministry of Tourism, Datuk Pahamin A Rajab, chairman of AirAsia Bhd, Sommas Siriwong, director-Malaysia & Brunei, Tourism Authority of Thailand, and Tony Fernandes, AirAsia Group CEO.

AirAsia presently operates over 100 domestic and international daily flights with a fleet of 14 Boeing 737-300s while associate company Thai AirAsia, operates an additional four Boeing 737-300.

-- BERNAMA

RHB Bank, AirAsia launch co-branded credit card


RHB Bank Bhd and AirAsia has launched a co-branded MasterCard that allows passengers to redeem flights on the budget carrier through loyalty programmes – its second in the region, the first with Singapore-based DBS Bank in April, which to date has generated about 10,000 seats.

The carrier planned to launch another “Shop and Fly” credit card in Thailand in October, AirAsia group chief executive officer Tony Fernandes said at the launch of AirAsia Credit Card in Kuala Lumpur yesterday.

RHB executive chairman Datuk Seri Sulaiman Abdul Rahman Taib said he was confident that the “Shop and Fly” credit card would be a hit as holders would enjoy a multitude of benefits besides the opportunity to fly free just by using the card.

Card owners earn AirAsia Ringgit each time they charge their purchase to the card at participating merchants.


http://biz.thestar.com.my/archives/2004/8/11/business/p3sulaiman.jpg
Datuk Seri Sulaiman Abdul Rahman Taib centre) and AirAsia chairman Datuk Pahamin A. Rajab pulling the mock-up of airplane throttles to mark the launch of AirAsia Credit Card. On the left is Tony Fernandes.

Sulaiman said AirAsia would in the long run also help bolster RHB Bank's credit card market share from the current 7% to between 10% and 15%, boosting its cardholder base to 500,000 within the next 12 months from 400,000 presently.

He said RHB Bank's market share was only 3% before it launched its chip-based EVO MasterCard 18 months ago.

“We are very optimistic that the current low interest rates and positive outlook for the Malaysian economy, which recorded 7.6% growth in the first quarter, will further boost consumer spending as well as credit card spending,'' he said.

He added that consumer banking was one of RHB Bank's major engines of growth and profitability.

I'm going to Kuala Trengganu next month for RM29.99. I guess it is cheap lor. Only the airport tax make it expensive :(

I'm going to Kuala Trengganu next month for RM29.99. I guess it is cheap lor. Only the airport tax make it expensive :(

I'm going back to Alor Star in two week times at RM29.90 + 16 = RM45.90

Wow so cheap guys! Korek duit tabung kat bilik also can fly already. :D

Wow so cheap guys! Korek duit tabung kat bilik also can fly already. :D

Then...you should do the same la. ;)

AirAsia to focus on core business

AIRASIA Bhd will continue to focus on its core business of providing low fares for its passengers, group chief executive officer Tony Fernandes said.

He was commenting on a recent report in the local dailies that KL Aircraft Sdn Bhd was trying to rope in the no frills airline as a partner to set up a maintenance service centre.

He said the airline would consider investing in an aircraft maintenance service centre but declined to say how much it was willing to invest. – Bernama

Boasted of being the best Asia Pacific Airline of the Year 2003 :)

http://img3.exs.cx/img3/7457/AirlinersNetPhotoID638124.jpg

AirAsia gets nod for IPO
By Yap Lih Huey & Faizal Zakariah

AirAsia Bhd has received the approvals of the Securities Commission, the Ministry of International Trade and Industry and the Foreign Investment Committee for its proposed listing on the Main Board — paving the way for the first such budget airline to be listed in the region.

It entails a public offer of 700.51 million shares of 10 sen each, out of which 116.75 million shares have been allocated for the public, 23.35 million shares for directors, employees and business associates, and 560.41 million shares for placements to local and foreign institutional investors.

It is believed that the listing exercise will see an initial public offering price of about RM1.50 per share. Analysts have fairly valued AirAsia at between RM2.37 billion and RM4.30 billion.

RHB Sakura Merchant Bankers Bhd, ECM Libra Bhd and Credit Suisse First Boston Inc are arranging AirAsia’s share sale.
Sources say that the book building process will likely take place from Oct 14 to Oct 28, while the scheduled listing is expected to be on Nov 22.

AirAsia is aiming to use the proceeds for the purchase of new planes and expansion of regional routes.
FinancialDaily reported on Monday that AirAsia was on track for a Main Board listing by December following the approval from the Securities Commission.

“Since AirAsia began operations as a low-fare airline in Southeast Asia in January 2002, we have increased our fleet size from two to 22 aircraft and achieved profitability despite the difficulties faced by the airline industry such as SARS, terrorist attacks and rising fuel prices,” he added.

An analyst has forecast AirAsia’s net profit to grow from RM18.80 million in 2003 to RM47.10 million in 2004, RM143.30 million in 2005, RM211.90 million in 2006 and RM306.4 million in 2007.

Pre-IPO, the major shareholders are Fernandes-controlled Tune Air Sdn Bhd (64.8%), Crescent Air (9%), and Islamic Development Bank (7%).

The other major shareholders include Deucalion Capital II Ltd, Crescent AirAsia II, and Lembaga Tabung Haji.

For the FY2004, AirAsia carried 2.8 million passengers and this is expected to increase to over eight million by FY2006.

An analyst says AirAsia's cost structure is one of the lowest in the industry, at less than 10 sen per available seat kilometre.

AirAsia is one of the fastest growing airlines in the region.

However, competition has come in the form of other regional airlines forming their own low-budget carriers.

Wow! ini sudah cukup bagus....BAnyak untung...kalau dapat!
Marilah kita membeli saham Air Asia..... :) :) :)

AirAsia seen to grow 80% a year


BY C.S. TAN

BUDGET airline AirAsia will be able to grow its passenger numbers, fleet size and net earnings by about 80% a year over the next three years, an analyst says.

The airline, including 49%-owned Thai AirAsia, carried 2.8 million passengers in its financial year ended June 30 (FY04). Its passenger volume is expected to triple to 8.5 million in FY05 and to rise further to 13.5 million in FY06.

This extraordinary rate of growth is attributed to a boom in low-cost regional air travel. The buoyant business condition arises from rising incomes and affordable air travel in the region.

A high growth rate will lift valuations for AirAsia's initial public offering (IPO) exercise and, later, its share price. The company announced last week it received approval from the authorities for a listing on Bursa Malaysia. The airline will make a public issue of 700 million shares of 10 sen each. It is expected to disclose the offer price at an underwriting ceremony today.

In the past, the demand for air travel was largely determined by economic growth and income levels. This has changed in recent years, as global demand is now also being driven by budget prices. Low-cost carriers (LCCs) like AirAsia have provided this impetus for demand.

To cater for the increasing passenger traffic, AirAsia, together with ThaiAsia, is expected to expand its fleet from 18 aircraft presently to 54 by FY07.

The group's net profit is estimated at RM50mil in the current FY05. This is believed to be quite a close estimate as the group has hedged the bulk of its fuel requirements until the end of this financial year.

Going forward, the analyst forecasts AirAsia to be able to raise its earnings to RM300mil by FY07 if jet fuel prices drop from the current US$55 a barrel to around US$38, which he believes is a more sustainable price.

On the basis of a forecast of AirAsia's earnings for the 2005 calendar year and a price earnings multiple (PE) of 22 times, the airline would be worth RM4bil, he says. He used this rich PE to reflect the growth stage the company is in. The airline is expected to price its IPO to value the company at RM3bil, he adds.

It is a particular concern to some observers that a number of other budget airlines have emerged in the region. AirAsia will be able to hold its own, the analyst says, as it is believed to have the lowest cost structure among these LCCs. Hence, AirAsia is able to price its seats lower than those of these competitors.

AirAsia to launch IPO prospectus in downtown Bintang Walk tomorrow

KUALA LUMPUR Oct 19 - AirAsia Bhd, the low cost carrier enroute to a listing on the Main Board of Bursa Malaysia, plans to launch its Initial Public Offering prospectus at Bintang Walk in the heart of Kuala Lumpur's shopping district Wednesday.

Its cabin crew will distribute 1,000 copies of the prospectus between 11 am and 2 pm.

In a statement Tuesday, the three-year old AirAsia said the launch would mark yet another milestone for the airline which had revolutionised air travel in the region since 2001.

The proposed listing of AirAsia entails a public offer of 700,509,400 ordinary shares of RM0.10 each, out of which 23,350,300 shares have been allocated for eligible directors, employees and persons who have contributed to the success of AirAsia.

A total of 116,751,600 shares will be for the investing public and the remaining 560,407,500 shares will be offered to institutional and selected investors by way of a bookbuilding exercise.

The institutional offering is to be managed by the joint bookrunners -- RHB Sakura Merchant Bankers Bhd, Credit Suisse First Boston (Hong Kong) Limited and ECM Libra Securities Sdn Bhd.

The underwriters for the AirAsia IPO retail offering are RHB Sakura Merchant Bankers Bhd, Southern Investment Bank Bhd, ECM Libra Securities Sdn Bhd, AmMerchant Bank Bhd, Avenue Securities Sdn Bhd and Hwang-DBS Securities Bhd.

Business Times - 20 Oct 2004


AirAsia to acquire AWAir to launch new flights

KUALA LUMPUR, Malaysia - Malaysian budget carrier AirAsia said on Wednesday it will buy a stake in Indonesian airline PT AWAir to launch new low-cost flights from Jakarta.

In documents detailing its upcoming initial public offering, AirAsia said it was paying a token of US$2 (S$3.36) to buy 49 per cent of AWAir, which suspended operations in March 2002 amid intense competition from other Indonesian carriers.

AirAsia is expected to tie up with an unidentified partner to relaunch AWAir's operations by as early as December this year. It would be AirAsia's second such operation following its joint venture with Thailand's Shin Corp, called Thai AirAsia.

'We will be flying domestic routes in Indonesia and beyond,' AirAsia chairman Pahamin Rajab told reporters. 'Our planes will go to places with a flying time of 3 1/2 hours. Australia is within the flying time.'

AirAsia has begun negotiations to launch similar joint ventures in China and the Philippines, company chief executive Tony Fernandes added, without giving details.

Shares of the Kuala Lumpur-based AirAsia will start trading on Bursa Malaysia in late November in what is expected to be Malaysia's biggest initial public offering this year, raising about RM800 million (S$354 million) for the airline.

The IPO is the first by a low-cost carrier in Southeast Asia, testing investor interest in an industry confronted with soaring fuel prices.

AirAsia, which began operations in 2002 and serves routes in Malaysia, Thailand and Indonesia, hopes the IPO will help it increase its fleet fourfold as it expands across the region.

Airbus, Boeing vying for major order from AirAsia
By KANG SIEW LI


THE world’s two largest aircraft makers, Europe’s Airbus and Boeing of the US, are vying to sell new aircraft to budget carrier AirAsia Bhd in a deal that will involve 40 firm orders and 40 options.

Bob Saling, a spokesman for Boeing’s commercial aircraft division, said since the middle of this year, Boeing has been in discussions with AirAsia in response to the carrier’s much-publicised plans to purchase new single-aisle airplanes.

In June this year, AirAsia group chief executive officer Tony Fernandes was quoted as saying that it planned to buy up to 80 aircraft over the next four to eight years.

AirAsia currently operates five owned and 19 leased B737-300s.

“(However,) our discussions with customers are part of an ongoing process, and the details are considered to be proprietary information between AirAsia and Boeing. By policy, we do not make such information public,” Saling told Business Times.

He also declined to comment on Boeing’s chances of securing the deal.

“We are not going to speculate. However, Boeing airplanes consistently outperform their competitors and AirAsia has had very good success with their current B737 fleet.

“The B737 continues to be the low-cost carrier leader and we believe that there are significant benefits to the operation of a B737 fleet in this type of service,” said Saling.

An Airbus spokesman also declined to elaborate on Airbus’ negotiations with AirAsia, but admitted that it was invited to submit a proposal.

“As in any campaign, our team is constantly in touch with the airline. However, we are not at liberty to disclose details of an on-going sales campaign,” he said.

Last month, Fernandes had told ATWOnline, an airline-industry newsletter, that the carrier was “within days” of ordering either B737-800s or A320s to support its proliferating network.

However, when asked about the matter during the carrier’s underwriting ceremony on October 12, Fernandes said AirAsia was still evaluating offers from Boeing and Airbus to buy their aircraft.

Business Times reported earlier that a source familiar with the negotiations had said that AirAsia had decided to acquire the Airbus aircraft due to the latter’s attractive pricing package.

It is learnt that Airbus had offered AirAsia a price of US$26 million (US$1 = RM3.80), or less, per aircraft in ready-to-fly condition for delivery in 2006.

The A320 carries a catalogue price of US$65 million, but discounts are common on large orders. In comparison, the catalogue price for a B737-800 is US$61.5 million to $69.5 million.

Boeing has given its “best” proposal, but could not compete on price, the source had said.

besides the cheaper price offer by airbus... i still prefer air asia to get boeing. i've notice most of the air crash happened to use airbus..

AirAsia IPO falls short
By Yap Lih Huey


AirAsia Bhd’s initial public offer (IPO) has fallen short of being the largest this year after failing to get institutional investors to pay at its indicative price of RM1.51 per share after the global book-building process, mainly on concerns of the high valuation and high jet fuel price.

In a statement on Oct 29, AirAsia said the IPO would raise gross proceeds of RM717.4 million — some 10% lower than its earlier projection of RM800 million. This year’s largest IPO so far would remain the listing of KLCCProperty, which raised RM765.5 million.

However, AirAsia, which sparked a rapid growth of low-cost carriers in the region, could still claim to have the largest retail tranche for a Malaysian IPO. AirAsia is expected to debut on the Main Board on Nov 22.

“Given the high valuation and fuel risk to earnings, it is not surprising that it would put investors off, especially when it is an airline,” said a local head of equity research. “But with the oil price easing a bit, it would give comfort for people who put in their bids.”

Nevertheless, AirAsia chief executive Tony Fernandes said: “We are very pleased with the level of interest in AirAsia’s IPO. We believe that AirAsia’s position as a leading low cost carrier in Asia and strong track record of growth through difficult times were key in the success of our IPO.

“AirAsia is now a highly recognised Asian success story with a strengthened financial position. We look forward to continuing to exploit our first mover advantage in the region and further growing our regional network,” he said.

AirAsia said the placement of its institutional shares had been priced at RM1.25 per share while the retail portion at RM1.1625 each, a 17% discount against its earlier indicative price of RM1.40.

On Oct 21, FinancialDaily reported that AirAsia’s high valuation was an issue among fund managers.

The carrier had hedged the jet fuel price for the six months ending Dec 31, 2004 at US$42 (RM159.6) per barrel on the assumption that average price would be US$51, but the price hedge had not been “fully effective” in the three months ended Sept 30, 2004. This was because the market price of jet fuel had exceeded the prescribed upper limits of AirAsia’s hedge.

AirAsia said its institutional tranche of 560.4 million shares was 3.5 times oversubscribed with 392.30 million placement shares allocated to international institutions while another 168.10 million shares were placed out for domestic institutional investors.

AirAsia’s public issue of 116.75 million shares saw an over-subscription rate of 146% with a total of 30,659 applications received for 170.02 million shares. Another 23.35 million shares were reserved for directors and employees.

Bad weather lah

The Star Online > News > Latest
Sunday, November 07, 2004

AirAsia flight skids off runway in Kota Kinabalu, two injured


News update by the Star Newsdesk

KOTA KINABALU: AirAsia Flight AK106 from Kuala Lumpur skidded off the runway at about 5.10pm during bad weather. Two passengers were injured when the Boeing 737 with about 100 passengers skidded.

A three year-old boy suffered a broken arm while another, who is still unidentified, had minor injuries. The remaining passengers and crew escaped unhurt.

Medical teams at the airport screened them before they were allowed to leave the airport.

One of the passengers, who identified herself as Zilla, said she felt the plane hitting a puddle of water when landing before swerving from the runway to the grass.

She said the aircrew members than advised the 100-odd passengers to exit through the emergency chutes.

"There was panic but no pandemonium," she said when met at the airport.

Plane skids off runway at Kota Kinabalu airport

BY MUGUNTAN VANAR AND RUBEN SARIO



KOTA KINABALU: An AirAsia plane with 110 passengers skidded off the runway at the international airport here but all on board escaped without any serious injuries.

In the 5.10pm incident yesterday, two passengers and the two pilots suffered minor injuries. One of the injured, a five-year-old girl, sprained her left wrist during evacuation from the Boeing 737-300 aircraft.

The passengers, including six top Laotian government officials, were shaken by the incident that occurred during a downpour.

Flight AK104 from Kuala Lumpur skidded onto the grassy patch towards the south end of the runway, forcing passengers to be evacuated via emergency chutes as Department of Civil Aviation (DCA) fire engines and ambulances rushed to scene.

A DCA official said the nose-wheel of the Boeing 737 was bogged down in soft soil and engineers were finding it difficult to extricate the aircraft because of nightfall and might only be able to do so today.






http://www.thestar.com.my/archives/2004/11/8/nation/crash.jpg

FLIGHT MISHAP: The AirAsia Boing 737-300 plane resting on its nose at the Kota Kinabalu International Airport yesterday. The aircraft skidded when landing at about 5.10pm






“The airport has been closed to all flights for now,” the official said.

The shutdown of the country’s second-busiest airport resulted in the diversion, rescheduling and cancellation of dozens of flights, affecting at least 2,000 travellers.

Prime Minister Datuk Seri Abdullah Ahmad Badawi, scheduled to depart on his executive jet at 9.30pm after a short visit, left at 10.45pm. He was here to break fast with Umno members.

In all, 24 incoming and 18 outgoing flights were affected with five diverted to Labuan and two to Miri airports. The incoming flights included those from Hong Kong, Cebu and China.

Malaysian Airlines has placed many of its passengers in hotels in the city. The carrier hoped that the airport would be fully opened by 7am today.

Although the DCA has “closed” the airport, it has allowed individual airlines to land or take off at their own risk. At 12.05am this morning, an AirAsia flight from Kuala Lumpur was seen landing.

A Universiti Teknologi Mara student who identified herself only as Zilla said the whole plane shook badly before it hit the grass.

“I was afraid. I thought we were going to die,” she said.

Raymond Danker, from Penang, who was visiting with his Sabahan wife and three children, said it was their first trip to the state since their marriage 10 years ago.








http://www.thestar.com.my/archives/2004/11/8/nation/Tracie.jpg

IN SAFE HANDS: Tracie being carried by her mother at the airport yesterday. The five-year old sprained her left wrist during evacuation from the plane.






“We were so happy about it and this had to happen,” he said.

He said his daughter, Tracie, suffered a sprain to her left wrist while sliding down the emergency chute, and his wife and two sons, aged three and seven, were shaken by the whole episode.

Among the passengers was Laotian deputy director-general of the Cabinet Committee for Planning, Houmpheng Souralay, one of the six senior Laotian officials here for a study tour organised by Yayasan Sabah.

“I am thankful that nothing serious happened,” said Souralay.

According to passengers, there were moments of pandemonium on the plane as they pushed and shoved each other towards the emergency exits during the evacuation.

The passengers were then ferried to the VIP terminal and given medical examinations before they were taken to Terminal Two and allowed to collect their luggage at about 7pm.

In a statement, AirAsia said that due to heavy rain and bad weather, Flight AK104 skidded slightly off the runway after it touched down at the airport.

sigh...this is really a sad case for Airasia.....I believe will affect their business as ppl will start to believe that the airline lags of safetiness

It might be the case, but I don't so.

I dun think so larr... the plane skid bcoz of bad weather wat and not bcoz of engine blew up or sumthing... juz that they are unlucky... mebbe the runway at that airport also not as good as KLIA... :?

yeah man,to me is not probelmo.However,there are some that will blame the pilot.We nv know:D

I dun think so larr... the plane skid bcoz of bad weather wat and not bcoz of engine blew up or sumthing... juz that they are unlucky... mebbe the runway at that airport also not as good as KLIA... :?

thank god that plane didnt crash into the sea.......the runway is sitting only beside south china sea.

sh*t happens man..glad that everyone is safe.

sh*t happens man..glad that everyone is safe.


yea.....people will always talk and talk and talk......even the safest airlines like MAS and SIA do skid and overshot the runway at times......minor accidents do happen :(

yea.....people will always talk and talk and talk......even the safest airlines like MAS and SIA do skid and overshot the runway at times......minor accidents do happen :(

yeah and that happened to Airbus A300 owned by SIA in 2000 when it skidded off runway at kuching due to wet weather

Mishap Did Not Damage Engines Of AirAsia Aircraft


KOTA KINABALU, Nov 8 (Bernama) -- The AirAsia Boeing 737-300 aircraft that skidded and veered off the runway on landing at the Kota Kinabalu International Airport here Sunday did not suffer damage to both its engines, the airline said in a statement Monday.

It said there was also no smoke from the plane as a passer-by had observed in earlier reports.

AirAsia said an investigation was being carried out by the Department of Civil Aviation and the company itself and that AirAsia would not release any information on the probe until it was completed.

AirAsia said the captain and first officer of its AK104 flight from Kuala Lumpur to Kota Kinabalu did not suffer any injury as reported but they were sent for a routine medical check-up, a procedure in the event of any incident.

The statement also said that a five-year-old girl carried by her mother during the evacuation process sprained her wrist and two other female passengers who sustained minor injuries received immediate medical attention.

AirAsia's Group Chief Executive Officer Tony Fernandes said the company was satisfied with the prompt response from its crew and staff who, he added, followed safety procedures to ensure the situation was handled effectively.

He said the airline resumed flights as soon as the authorities had reopened the runway in Kota Kinabalu Sunday night.

AirAsia's Flight AK104 skidded at 5.10pm Sunday and veered to the left of the runway after it touched down amid a heavy downpour. As the ground was soft due to constant rainfall, the nose-wheel of the aircraft got embedded in the ground.

Late this evening, the nose-wheel was seen to have been pulled up from the ground and the aircraft was waiting to be towed to the hangar.

-- BERNAMA

I didn't know Kota Kinabalu airport is the second busiest airport.I thought it was Penang's.I really wonder if anyone in this forum currently have the fear of taking Air Asia.

I didn't know Kota Kinabalu airport is the second busiest airport.I thought it was Penang's.I really wonder if anyone in this forum currently have the fear of taking Air Asia.


I would have tot it was Penang until recently I discovered that KK airport have more International flights than Penang :eek:


ANyway I always have no fear of flying cos I believe all accidents are fated. It is either you are there or you are not there. I flew less than 2 months after 9/11 back in 2001 :D

I didn't know Kota Kinabalu airport is the second busiest airport.I thought it was Penang's.I really wonder if anyone in this forum currently have the fear of taking Air Asia.

yeah, on a busy day departure intervals can be as close as 5 minutes

I really wonder if anyone in this forum currently have the fear of taking Air Asia.

I flew with Air Asia 4 times this year. For me it is as safe as the next available flight from a different airlines. Yet I am scared of flying :D

I flew with Air Asia 4 times this year. For me it is as safe as the next available flight from a different airlines. Yet I am scared of flying :D


Wah! Where you go lah? :D Jet setting eh? kaya betui...... :D

why suddenly you all fear of taking air asia? is it because they use old planes or pilot errors? :? :?

Business Times Singapore: 9th. November 2004

Runway mishap unlikely to hurt AirAsia's IPO prospects
By PAULINE NG

AIRASIA is likely to have a smooth debut on Bursa Malaysia later this month despite a mishap that could have been potentially more serious last Sunday.

The airline's skid off the Kota Kinabalu International Airport runway on Sunday evening is not likely to mar investor sentiments before its debut, scheduled on Nov 22.

Analysts contacted by BT said that the airline's little mishap was 'part and parcel of operations' and would not affect its impending listing.

In the Sunday incident, an AirAsia plane with 110 passengers on board skidded off the runway at the East Malaysian airport, resulting in the evacuation of passengers via emergency chutes.

Two passengers and the airline's two pilots reportedly suffered minor injuries. The Department of Civil Aviation has closed the airport and investigations are underway on the cause of the skid.

An analyst who declined to be identified said it was unrealistic to expect any airline to be incident-free, and that so long as it was an isolated incident, it was unlikely to rain on AirAsia's listing debut parade.

The incident, however, may train the spotlight on AirAsia's quick turnaround time - a point of pride for the low cost carrier.

Said an analyst from Mayban Research: 'The incident will have minimal impact on its listing,' but he added there could be questions on whether the airline's planes should be more thoroughly inspected or maintained. The first budget airline to list, AirAsia will raise RM717.4 million (S$312 million) from its listing exercise.

It had priced the institutional portion of its initial public offering at RM1.25 per share and the retail portion at RM1.16, well below its earlier indicated price of RM1.40.

With a current fleet of 24 Boeing 737 aircraft, AirAsia plans to use the IPO proceeds to increase its fleet to 80 aircraft.

While its first mishap could have been perhaps better timed, AirAsia can take cheer from an important area of its operations: jet fuel prices.

'Jet fuel prices have come down substantially and as far as investors are concerned, the timing of its listing is quite good,' added the analyst.

Business Times Singapore: 9th. November 2004

Airbus set to win US$5.2b AirAsia order: report

(PARIS) European aircraft maker Airbus is poised to win a US$5.2 billion order from Malaysia's AirAsia for its A320 short-haul aircraft, pushing out US rival Boeing who had previously been the budget airline's sole supplier, the Wall Street Journal said yesterday.

The paper said AirAsia, which is currently completing an initial public offering, is expected to announce the order in a few weeks. Airbus was not immediately available to comment. Citing sources familiar with the order, the newspaper said Airbus's offer was priced well below Boeing's bid.

The two companies are currently locked in a trade dispute over state aid, which has seen the United States and the European Union file cases at the World Trade Organisation.

Airbus is 80 per cent owned by the European Aeronautic, Defence and Space Co (EADS) and 20 per cent owned by Britain's BAE Systems.

Meanwhile, Xiamen Airlines, a regional carrier controlled by China's largest airline, may buy and lease Boeing 737-800 planes starting in 2006 as it expands its fleet to meet growing demand for air travel.

'We have not decided on the number of planes,' Wang Zhouzhou, manager of Xiamen Air's financing office, told reporters at an aviation conference in Hong Kong. 'We do have plans to replace the 737-300 and 737-500 planes in our fleet.' Fujian, southeastern China-based Xiamen Air, which is controlled by China Southern Airlines Co, and other Chinese carriers are expanding their fleets as rising urban incomes boost demand for air travel in the country. Passenger traffic in China is forecast to grow at an annual 7.3 per cent in the next two decades, compared with a global average of 5.2 per cent, according to Chicago-based Boeing. The 737-800 can carry as many as 189 passengers and has a range of up to 5,449 km. Each 737-800 aircraft costs as much as US$69.5 million, according to catalogue prices.

Xiamen Airlines currently operates a fleet of 29 Boeing aircraft, 10 of which are 737-300s and 737-500s, Mr Wang said. - Reuters, Bloomberg

why suddenly you all fear of taking air asia? is it because they use old planes or pilot errors? :? :?


hahaha.....I think all just becos of this minor incident.

BTW AirAsia's planes aren't that old. The one I am on is quite new.....very very very new if compared to American domestic operations :D

Yalah...plane skid.....no worries. I only worry if plane blows up in midair or plummets into ocean or something. Then, I worry abt maintainence....US domestic operations not that bad nowadays....I think they're all fighting to stay alive so everyone wants to offer the best product....

US domestic operations improved oredi... great! They had phased out the Fokkers izit? Last time when I was still there studying (1998)... they still used it... but it was a great experience afterall!!

The Straits Times (Singapore), 10th. November 2004
AirAsia 'won't be badly hit' by runway mishap
By Leslie Lau
Malaysia Correspondent
In Kuala Lumpur

BUDGET airline AirAsia says its operations are unlikely to be badly affected by one of its aircraft skidding off the runway in Kota Kinabalu on Sunday.

'We just have to reschedule some of our flights because we have another 23 aircraft in our fleet,' AirAsia assistant manager for publicity and promotions Ethan Liew told The Straits Times.

AirAsia resumed its flights to Kota Kinabalu, Malaysia's second busiest airport, on Monday, just a day after the incident.

On Sunday, an AirAsia Boeing B737-300 aircraft carrying 110 passengers skidded off the runway on landing and ended up with its nose wheel embedded in the soft soil.

A five-year-old girl sprained her wrist and two other passengers sustained minor injuries.

The airline said the aircraft veered to the left when landing and was bogged down in the ground which was soft because of rain.

Mr Liew said the aircraft has been towed off the runway and, in accordance with regulatory procedures, an investigation is being carried out by the Department of Civil Aviation.

Before the aircraft was towed away on Monday, it had obstructed operations at the Kota Kinabalu airport, leaving thousands of passengers stranded.

Wide-bodied jets could not land at the airport with part of the AirAsia aircraft still on the runway.

As a result, Malaysia Airlines had to reschedule 42 flights affecting about 2,000 passengers.

Air Asia, which flies up to 35 times a week to Kota Kinabalu, had to reschedule at least eight flights because of the temporary closure of the runway on Monday.

'But we should have no further problems. We are just retiming our flights with other aircraft,' said Mr Liew.

AirAsia close to reaching deal to buy 80 airplanes
Source: Bangkok Post (Thailand), Monday 15 November 2004.

Kuala Lumpur - Budget airline AirAsia will reach an agreement as early as next month to acquire 80 new aircraft, either from Boeing Co or Airbus, its chief executive has said in an interview.

AirAsia, which is credited with revolutionising cheap air travel in the region, wants to place 40 firm orders and 40 options from either of the two trans-Atlantic rival aircraft manufacturers, the company CEO Tony Fernandes was quoted as saying by the national news agency Bernama on Saturday.

``Although the board of directors has not accepted any current proposal from Airbus or Boeing, negotiations are now at an advanced stage and an agreement may be reached as early as December 2004,'' Mr Fernandes told Bernama in an e-mail interview.

AirAsia, which is scheduled to be listed on Malaysia's main stock exchange Bursa Malaysia Bhd on Nov 22, currently has a fleet of 19 leased and five fully owned aircraft _ all of them Boeing 737-300s.

Mr Fernandes said he would acquire other type of aircraft if they offer advantages such as improved fuel efficiency, higher passenger capacity and lower maintenance costs.

If the plan to buy aircraft other than Boeing 737-300 does materialise, they would be delivered over a period of several years starting January 2006, he was quoted as saying.

Mr Fernandes said the fleet expansion would come partly from the 863.4 million ringgit (US$227. 2 million) raised from its Initial Public Offering, debt or lease financing and the expected cash generated from its operations.

``AirAsia has adequate liquidity and capital resources for its present requirements and for its requirements and expansion plans for the next 12 months,'' he said.

The three-year old airline sold its shares to institutional investors _ which received 80% of the 700.5 million shares offered _ at 1.25 ringgit (32 US cents) a share. The balance was sold to retail investors who paid 93% of the institutional price or 1.16 ringgit (30 US cents) a share.

AirAsia operates 322 flights a week from Kuala Lumpur International Airport to 14 domestic destinations and eight international destinations.

Meanwhile, AFP reported that AirAsia plans to begin flying to China by February, which will open up a giant market for it.

Mr Fernandes was quoted by the New Straits Times as saying the airline was in the midst of securing approvals to fly to key Chinese cities such as Xiamen, Chengdu, Guangzhou, Chongqing and Hainan from Bangkok through its subsidiary Thai AirAsia.

``We do not expect to have difficulty in this area as there is a bilateral open skies air service agreement already in place between Thailand and China,'' he said, adding that it expected to start flights before the Chinese Lunar New Year _ a peak season travel in East Asia.

Mr Fernandes said the carrier also planned to operate China-bound flights from Kota Kinabalu, the capital of Malaysia's Sabah state on Borneo island, pending the completion of expansion work at the airport there.

``We have also applied for government approvals to fly between Malaysia and China, and expect to do so sometime next year,'' he said, adding that AirAsia chose Kota Kinabalu instead of Kuala Lumpur because it was closer to China.AP, AFP

AirAsia Asks Govt For Permission To Operate From Subang Again

By Tengku Noor Shamsiah

SEPANG, Nov 12 (Bernama) -- AirAsia hopes that the government will consider allowing it to operate from the Sultan Abdul Aziz Shah (SAAS) Airport in Subang to make Malaysia a hub for low fare carriers in Asia.

AirAsia's chief executive officer Tony Fernandes said the fallacy that Kuala Lumpur International Airport (KLIA) was empty was now over.

"With 19 million to 20 million passenger this year, KLIA has an 80 percent capacity. In the morning, KLIA is as bad (congested) as Dongmuang Airport (in Bangkok) or Heathrow Airport (in London)," he told reporters at a press conference here Friday morning.

Fernandes also said there was a flight delay at KLIA this morning because the runaway was full.

The government, he said, could build another terminal at KLIA but that would not solve the problem because there would still be only two runaways.

"So, why waste a fantastic runaway we have downtown (in Subang)?" he asked.

To build a new terminal and runaway at KLIA will cost billions of ringgit and this would take at least another 10 years, he added.

"In Subang, we have all the space to service low-cost airlines and we need only RM85 million to redevelop the airport," said Fernandes.

He said AirAsia would rise to be the number one low-cost carrier in this region and benefit Malaysia in terms of huge economic returns.

Fernandes said he was confident that there would be no impact on KLIA even if AirAsia was allowed to operate from Subang.

Passengers, he said, would still fly on Malaysia Airlines to other premium destinations.

Those who want to have interconnecting flights to other airlines would continue to use KLIA, he said.

"Give us the tool to be one of the lowest cost airlines as there is a huge market potential for low-cost travel," he stressed.

In Europe, Fernandes said there were currently 60 million seats for low-cost travel between London and Dublin (Ireland) alone.

"And if we develop Subang and have the KLIA (as well), we are unbeatable (in the region)," he said.

He also said there would be an "open sky" between Singapore and Malaysia one day in the future.

"And when that happens and if Malaysia does not have a low cost and best infrastructure, Tiger Air from Singapore would seize the opportunity to fly people, for instance, from Penang to Singapore and elsewhere," he said.

Fernandes pointed that given that 80 percent of AirAsia passengers were foreigners, this meant that they could be attracted to change their flight plans from Bangkok or Singapore to Subang where they can either fly to Kuching, Kota Kinabalu, Kuching or even Phuket.

"If you have those services out of Singapore, then they will go back to Singapore and may fly from London to Singapore and then use Tiger Air to fly to other destinations (in this region)," he said.

He said if Malaysia could offer the lowest fares and best flight networks, this would drive passengers to its own low cost carrier, AirAsia.

To have the lowest fares, Fernandes stressed that AirAsia has to operate from Subang.

He also said that AirAsia has a tough battle ahead with Singapore low cost carriers which were trying to catch up with the company.

Citing a recent news report, Fernandes said the budget airlines market has grown 12 percent but AirAsia grew by 300 percent.

With SAAS Airport in Subang, he said AirAsia would have greater advantages compared to Singapore.

It was reported earlier that the government was considering making SAAS a hub for low cost airlines.

A study has been conducted on whether to make SAAS a low fares and no frills airlines hub, or to build a low fare terminal at KLIA.

AirAsia: Negotiations For Additional Aircraft At Advanced Stage

By M. Saraswathi

KUALA LUMPUR, Nov 12 (Bernama) -- Low cost carrier AirAsia Bhd is currently at an advanced stage of negotiations for new aircraft purchases and an agreement may be reached as early as December 2004 to acquire of up to 80 new aircraft, says group chief executive officer Tony Fernandes.

He said AirAsia, which continuously reviewed fleet requirements, was considering a proposal for 40 firm orders and 40 options from either Airbus Industrie or Boeing.

"Although the board of directors has not accepted any current proposal from Airbus or Boeing, negotiations are now at an advanced stage and an agreement may be reached as early as December 2004," he told Bernama via e-mail.

Fernandes said in the event that AirAsia acquired additional aircraft of a different type other than its current fleet of Boeing 737-300s, the airline expected that the new aircraft would be delivered over a period of several years, commencing as early as January 2006.

He said the group's entire fleet would gradually shift to different aircraft types with different engines.

Fernandes said AirAsia, which would be listed on the Main Board of Bursa Malaysia later this month, expected that if it were to purchase new aircraft, they would have to offer advantages over AirAsia's current fleet such as improved fuel efficiency, higher passenger capacity and lower maintenance costs.

"AirAsia plans to proceed with the proposed acquisition only if it believes that such a purchase would be likely to benefit its shareholders, taking into account, among other things, the economic benefits of any new aircraft type," he explained.

Fernandes said the company would also have to consider factors like the routes that could be flown with such aircraft, the group's ability to secure the necessary approvals to fly such routes, the potential risks and operating difficulties of such an aircraft type and whether AirAsia could maintain substantial unrestricted cash balances.

Currently, AirAsia has a fleet of 24 aircraft and operates 322 flights a week from Kuala Lumpur International Airport (KLIA) to 14 domestic destinations and eight international destinations. Flights to Chinese destinations are from Bangkok (Thailand) at present.

Fernandes said the fleet expansion plan would come partly from the proceeds from its Initial Public Offering (IPO), AirAsia's ability to obtain debt or lease financing or banking facilities and the expected cash generated from its operations.

"AirAsia has adequate liquidity and capital resources for its present requirements and for its requirements and expansion plans for the next 12 months," he said.

The company is raising RM863.4 million via its IPO.

The three-year old airline sold its shares to institutional investors -- which received 80 percent of the 700.5 million shares offered -- at RM1.25 a share.

The balance was sold to retail investors who paid 93 percent of the institutional price or RM1.16 a share.

On its plan to acquire Indonesia's PT Air Wagon International (Awair), Fernandes said AirAsia had entered into two conditional sale and purchase agreements to acquire a 49 percent stake for US$2 on Aug 30.

Awair operated as a full service carrier before suspending operations in March 2002.

Completion of the transaction is subject to various conditions including approval by various Indonesian regulatory authorities and further due diligence by AirAsia, said Fernandes.

Assuming the transaction is completed, AirAsia intends to adopt a low-cost carrier model and operate from a hub at Soekarno-Hatta International Airport in Jakarta.

However, Fernandes said Awair could recommence operations as early as next month, prior to completion of the transaction.

-- BERNAMA

AirAsia To Fly To China From February


SEPANG, Nov 12 (Bernama) -- AirAsia will fly into China from Bangkok and Kota Kinabalu tentatively from February next year, its group chief executive officer, Tony Fernandes, said Friday.

He said the low cost carrier was in the midst of getting approval from the relevant authorities.

Among the places that AirAsia is looking to fly into China are Xiamen, Guangzhou, Hainan, Chongqing and Chendu.

Fernandes said Kota Kinabalu was chosen because it was closer to China.

AirAsia currently flies to Macau, the former Portuguese colony, in the Pearl River Delta region of southern China from Bangkok and is expected to launch more flights there.

AirAsia, which has a fleet of 24 Boeing 737 aircraft, currently operates 322 flights a week from the Kuala Lumpur International Airport here to 14 domestic destinations in Malaysia and eight international destinations in Thailand and Indonesia.

AirAsia To Invest US$10 Mln For Indonesian Operations
By Christine Lim

KUALA LUMPUR, Nov 22 (Bernama) -- Low cost carrier AirAsia Bhd would allocate US$10 million as capital expenditure (capex) to commence operations in Indonesia by January next year, its executive director, Kamarudin Meranun, said Monday.

The capex included the cost for setting up distribution outlets and call centres, he said at the listing of the company on the Main Board of Bursa Malaysia here.

"AirAsia sees potential from Indonesia apart from its current operations in Malaysia and Thailand," said Kamarudin.

AirAsia is starting up its base in Jakarta via a joint venture company, PT AW AWAir. Via AirAsia International Labuan, AirAsia bought a 49 percent stake in the joint venture company while the original owners and the chief executive officer, Sendjaya Widjaya, own the remaining 20 percent and 31 percent respectively.

Kamarudin indicated that the company was anticipating an increase in passenger volume during the holiday season from next month.

"We do not envisage the current high oil prices impacting on the company's bottomline with the company's prudent approach in hedging fuel prices," he said.

He said oil supplies had been hedged until June 2005.

Due to an expansion of AirAsia's operations, the company will be finalising the purchase of an additional 40 to 80 planes within the next one to two months.

The planes could either be Boeing's new generation 737s or Airbus A320 series.

Kamarudin said AirAsia was also looking into expanding into China from its Bangkok hub in the early part of next year.

"We are ready to face any competition as we believe our brand quality will put us among the best in the industry," he said.

The listing status of AirAsia would also enhance its financial strength and take advantage of growth opportunities in the region, he said.

AirAsia's initial public offering (IPO) raised gross proceeds of about RM717.4 million.

The company's shares opened at RM1.25 on the main board of Bursa Malaysia, up nine sen from its offer price of RM1.16.

Kamarudin described the small premium as being "undervalued for this sector of the industry."

"It has the potential to go up further based on the company's business prospects," he added.

-- BERNAMA

The Star: 30th. November 2004

AirAsia makes case for Subang airport again

SEPANG: With just weeks to go before AirAsia finds out whether it can operate in Subang, its chief executive officer Tony Fernandes is making a “last-minute dash” to convince the Government on the need for it to operate from a second airport.

He said the two-airport strategy had been successful in several countries like Brazil and Italy.

“These countries set up another airport because they understand the low-cost carrier business. Airlines like ours need to maintain low-cost operations,” he told a press conference here yesterday.

Fernandes said AirAsia was eyeing Subang because of the need for quick departures and its facilities like the existing runway.

He said that the KL International Airport was congested with passengers checking in and the runway was often packed with aircraft in the morning, resulting in flight delays for AirAsia.

“We are not after Subang just because it is nearer to the city. We are trying to make it affordable for everyone to fly and cost-effective for us at the same time,” he added.

From utusan online...can't find the English version,

AirAsia minat beli 39 pesawat B737-400 MAS
Oleh Khairuddin Mohd Amin

KUALA LUMPUR 6 Dis. - Syarikat penerbangan tambang murah, AirAsia Bhd. (AirAsia) telah menyerahkan cadangan kepada Khazanah Nasional Bhd. untuk membeli 39 buah pesawat B737-400 yang mahu dilupuskan oleh Malaysian Airline System Bhd. (MAS) pada harga lebih RM700 juta.

Menurut sumber industri, cadangan yang diserahkan minggu lalu itu, sedikit sebanyak menunjukkan syarikat penerbangan itu boleh melakukan kerjasama dengan mana-mana pihak.

``Bagaimanapun nilai jangkaan jualan MAS yang melebihi RM700 juta itu jauh lebih tinggi daripada apa yang sanggup dibayar oleh AirAsia,'' katanya di sini, hari ini.

Pelaksanaan penstrukturan semula MAS menerusi konsep pelupusan harta secara besar-besaran (Widespread Asset Unbundling - WAU), semua liabiliti dan pesawat syarikat penerbangan kebangsaan itu dipindahkan ke Penerbangan Malaysia Bhd. (PMB) yang merupakan syarikat milik penuh Kementerian Kewangan Diperbadankan.

Khazanah yang merupakan sayap pelaburan kerajaan adalah syarikat milik penuh Kementerian Kewangan Diperbadankan.

Pada 29 November lalu, ketika mengumumkan prestasi kewangan suku kedua MAS, Pengarah Urusannya, Datuk Ahmad Fuaad Dahalan menjangka syarikat itu akan meraih pendapatan sekitar RM700 juta hasil daripada penjualan 39 buah pesawat B737-400 yang kini digunakan bagi laluan domestik dan serantau.

Ahmad Fuaad berkata, terdapat formula yang perlu digunakan bagi melupuskan pesawat tersebut berikutan pelaksanaan WAU di mana syarikat akan meraih 80 peratus daripada keuntungan penjualan.

Berdasarkan kepada harga industri, sekiranya MAS melupuskan 39 buah pesawat B737-400 pada 30 September 2004, penjualan tersebut akan menjana pendapatan sebanyak RM761.2 juta.

Bagaimanapun, sebelum ini, Ketua Pegawai Eksekutif AirAsia, Tony Fernandes berkata, syarikatnya dijangka membelanjakan antara AS$4.8 bilion (RM18.24 bilion) hingga AS$5.6 bilion (RM21.28 bilion) bagi membeli 80 buah Airbus ataupun Boeing baru.

AirAsia yang kini mengendalikan 24 buah B737-300 merancang menempah 40 buah pesawat yang akan mula dihantar pada tahun 2006 dengan opsyen membuat pembelian tambahan 40 buah pesawat lagi.

Sumber itu berkata, adalah sukar untuk menentukan sama ada cadangan yang dikemukakan oleh AirAsia itu akan menjadi kenyataan kerana ia masih di peringkat awal.

Jelasnya, minat untuk membeli pesawat MAS itu secara tidak langsung menggambarkan AirAsia juga berminat untuk mengambil alih beberapa laluan kendalian syarikat kebangsaan itu, khususnya bagi laluan yang tidak menguntungkan.

Posted: 15 December 2004 1550 hrs

AirAsia to buy 40 Airbus jets in blow to Boeing: source

KUALA LUMPUR : Malaysian budget carrier AirAsia has opted to buy 40 A320 jets from Europe's Airbus and will phase out its current Boeing fleet, an industry official said Wednesday, a decision seen as a major setback for the US aerospace giant in the burgeoning Asian low-cost airline market.

"Yes, AirAsia has picked Airbus. It will buy 40 jets. The contract will be inked on Friday," the industry source familiar with the deal told AFP.

AirAsia officials declined to comment.

Asked why rival Boeing lost the deal, the industry insider said: "In terms of price and technical specifications, Airbus is better."

"All the current Boeing aircraft with AirAsia will either be phased out or sold," the source added.

AirAsia, the region's largest low-cost carrier, currently operates a fleet of 26 Boeing 737 aircraft.

Boeing officials have acknowledged that capturing the contract was critical for them to regain sales momentum in the market.

The source declined to reveal the cost of the 40-jet deal, saying only: "They are getting it cheaply."

The order would be valued at US$5.2 billion at the catalog price but AirAsia was likely to receive significant discounts, the Wall Street Journal said in a report on the negotiations last month.

Quoting people familiar with the offer, the newspaper said the A320 jetliners were priced well below Boeing's.

The industry source told AFP the first aircraft would arrive in early 2006, followed by one jet each month.

Australia-based managing director for the Centre for Asia-Pacific Aviation, Peter Harbison, told AFP that AirAsia's decision to pick Airbus was bad news for Boeing.

"It is not good news for the US manufacturer since the current fleet consists of Boeing. Five years ago, Airbus was invisible over Asian skies. It is now becoming dominant," he said.

Harbison attributed Airbus's success to better pricing and the ability to meet demand.

"Part of the problem for Boeing is being not able to produce aircraft. After (the terror attack on the US on) September 11, local carriers were not placing new orders and Boeing downsized its labour force.

"Now there is a surge in demand from low-cost carriers and Airbus is in a stronger position to produce. They are also aggressive in pricing," he said.

Harbison said with the new order, AirAsia would have the youngest fleet in Asia, putting the carrier "well ahead of anyone else."

AirAsia has set its sights on a fleet of 80 aircraft and is expected later to take an option to buy or lease 40 more Airbuses.

The three-year old no-frills carrier has expanded from a two-jet operation to become Asia's leading economy airline, carrying 7.5 million passengers since its launch in December 2001.

It operates 322 flights a week from Kuala Lumpur International Airport to 14 domestic and eight international destinations, and plans a major regional expansion programme.

AirAsia became the first budget carrier to be listed in Southeast Asia in November, when its initial public offering (IPO) was snapped up by investors. - AFP

AirAsia Begins KL-Macau Flights


KUALA LUMPUR, Dec 15 (Bernama) - AirAsia, a leading low fare airline in South East Asia, has added another milestone to its three-year old operations by becoming the only low fare airline to connect Kuala Lumpur with Macau, the Special Administrative Region of China.

AirAsia flight AK 050 departed from KL International Airport with 148 guests (full capacity) at 7.40pm and landed at Macau International Airport at 11.20pm.

Tony Fernandes, group chief executive officer, AirAsia Bhd said seats for the KL-Macau service had been sold out for the next 10 days.

"Prior to AirAsia commencing our first flight to Macau from Kuala Lumpur, we already had 2 daily flights into SAR through Thai AirAsia, our join venture company in Thailand," he said.

AirAsia had earlier launched the new KL - Macau service by offering 5000 seats at a special promotional fare of RM 99.99/MOP 219 one way.

Regular low fares for the KL-Macau service starts from RM159.99 one way.

** All fares quoted are excluding airport taxes and fees, and is applicable for travel one way only.

The inclusion of Macau will add to AirAsia's increasing presence in the region, and further boost its extensive network in Malaysia, Thailand, Singapore and Indonesia, to allow for greater connectivity between the countries.

AirAsia's joint venture in Thailand, Thai AirAsia, presently operates two daily flights to Macau via its hub in Bangkok International Airport.

-- BERNAMA

Come to think of it...AirAsia is enjoying a monopoly on all LCC routes into and out of Malaysia? The only route which seems to be operated by a foreign carrier is Lion Air's route from Medan to Penang?

AirAsia orders 40 jets, may lease 12 in interim


BY B.K. SIDHU




AirAsia Bhd will add 12 more aircraft to its existing fleet of 24 over the next six to 10 months, on top of the US$2.5bil order it placed yesterday with the world’s largest aircraft maker, Airbus SAS, for forty A320.


The order for 40 aircraft is the largest placed to date by an Asian carrier for the A320 family. AirAsia also has rights to order an additional 40 aircraft, bringing the total to 80 over eight to 10 years at a total cost to the airline of US$5bil.

AirAsia will only be able to take delivery of its first A320 in January 2006 and the balance 39 over five years, although group chief executive officer Tony Fernandes had wanted them delivered within a three-and-a-half year period.

AirAsia, however, needs 12 aircraft urgently, as it is on an aggressive drive to expand its flight network that operates from four hubs: KL International Airport, Senai Airport, Bangkok, and Jakarta.

“We will likely lease the 12 aircraft, although we may consider buying one or two. For this, we are looking at the B737 aircraft type,’’ Fernandes said after signing a memorandum of understanding for the 80 aircraft with Airbus in Sepang yesterday.






http://biz.thestar.com.my/archives/2004/12/18/business/p1airasia.JPG

(From left) Tony Fernandes, AirAsia chairman Datuk Pahamin A. Rajab and John Leahy at the signing of the MoU on aircraft purchase










AirAsia currently has 24 B737s, 19 of which are leased. It owns the other five.

The budget airline has not committed itself to buying the additional 40, but if it does so it will eventually end up with 116 aircraft – the largest fleet in South-East Asia.

AirAsia said it would gradually shift its operations to the new aircraft type with new engine to replace its current fleet, but in the interim operate a mixed fleet.

Fernandes said the additional 12 planes were needed as AirAsia would begin flights to China from Bangkok in April; and as the airline planned to ply various other destinations in the countries it currently operated in. The airline began flying to Macau from KLIA recently.

And, with its flights from Jakarta to Medan experiencing a 92% load factor, it needs additional planes to fly to more destinations within Indonesia.

Airbus beat Boeing over the 80 aircraft order. Airbus officials declined to say what discounts were offered to AirAsia but it is common for aircraft makers to offer discounts to the list price. The list price for the A320 is US$63mil.

Fernandes said two factors swayed AirAsia selecting Airbus over Boeing: economics and great support.

“The economics made a lot of sense and we are buying a brand new aircraft that will reduce costs for us,” he said. “The Airbus team has also been very supportive and determined. We do not buy planes every day and it is important to have the right partner.’’

The A320 has higher passenger capacity and improved fuel efficiency that leads to cost savings and lower cost of operation on a per seat basis. That is why Fernandes said pricing for tickets “will go down’’.

He said a quarter of the proceeds from the recent initial public offering (IPO) of over RM800mil would be used to finance the purchase.

In a statement, AirAsia said the funding for the purchase would be mainly from borrowings that would be guaranteed by European credit agencies, with which AirAsia was having negotiations.

Airbus chief commercial officer John L. Leahy, who flew in from France for the signing, said the A320 would contain components made close to home.

“For many years, CTRM in Malacca had been a supplier of many advanced composite wing components for the A320 family and have subsequently extended their relationship with Airbus with an agreement to produce wing components for the A380,’’ he said.

Leahy said there were a total of 340 aircraft of the A320 family in service with 30 airlines in the Asia-Pacific.

As for the engines to power the A320, Fernandes said General Electric Co (GE) was the front-runner. GE is a partner with France’s Snecma that jointly own CFM International, the engine supplier for the A320.

On Bursa Malaysia yesterday, AirAsia shares rose 3 sen to RM1.81.

Airbus: Price offered to AirAsia was competitive


THE “discount” price given to AirAsia Bhd, that helped Airbus win the contract against US brand Boeing, was very “competitive and close.''

“I never said that I offered a big discount to AirAsia and discount is the word that I hate to use,” John Leahy, Airbus chief commercial officer and executive vice-president (customer affairs) stressed.

AirAsia signed a MoU with the European space consortium yesterday for 40 firm orders to purchase the new A320 aircraft in a deal worth about US$2.5bil.

Rumours were rife that Airbus was giving almost 50% off to AirAsia for the A320 which carries a price of US$63mil each.

“The offers made by both manufacturers were very similar in terms of price. Our aircraft here is a modern aircraft designed at the end of the 1990s, for the 21st century,” he said.

“If all things are equal in terms of bidding, then it is natural that AirAsia selected the plane with wider seats, lower fuel burn and lower maintenance cost,” he added.

On whether the “single largest order” had anything to do with the price, Leahy said the large order would normally come with a slightly lower price “but that is not always the case”.

“We give competitive prices comparable to what Boeing is giving in the market place right now for aircraft,” he added.

Leahy said the contract worked out to be a “profitable” deal for Airbus which was “pleased” with the transaction.
Airbus, with the A320 family, has over 6% of the market share for a single isle aircraft around the world.

Low-cost carriers (LCCs) are very significant in the US and Europe, moving up close to 40% of the domestic regional market. Airbus has dominated the LCC market over the past two years.

However, Leahy said Airbus would not shift its focus to LCC even though there was strong demand for the aircraft.

“We are actually doing very well around the world. In fact, the A320 family has over 60% share in the worldwide market. If we look at the LCC market five years ago, those LCCs would have bought B737 but now, they are all buying the A320 family,” he said.

Airbus' strategy is to win over the airlines to buy its improved aircraft. – Bernama

Largest Single Order For Airbus By LCC
By Massita Ahmad

KUALA LUMPUR, Dec 17 (Bernama) -- The European aircraft manufacturer, Airbus' sales of 40 of its A320 is a single largest deal ever secured in the Asia Pacific region from a low cost carrier (LCC).

Its chief commercial officer and executive vice-president customer affairs, John Leahy said these orders were important to the company considering that it has 350 aircraft under the A320 family flying in the region and that previous orders were very small

"We are very pleased with AirAsia. They are moving fast, growing rapidly and we are proud to be chosen as a partner," he told Bernama and Business Times in a special interview Friday.

Asked on the "discount" price given to AirAsia that led Airbus to win the contract against US brand Boeing, Leahy said it was very competitive and close.

"I never said that I offered a big discount to AirAsia and discount is the word that I hate to use," he stressed.

AirAsia signed a memorandum of understanding (MoU) with the European space consortium today for 40 firm orders to purchase the new A320 aircraft in a deal worth about RM9.5 billion.

Rumours were rife that Airbus was giving almost 50 percent off to AirAsia for A320 which carries a price of RM60 million each.

"The offers made by both manufacturer were very similar in terms of price. Our aircraft here is a modern aircraft designed at the end of 1990s, for the 21st century," he said.

"If all things are equal in terms of bidding, than it is natural that AirAsia selected the plane with wider seats, lower fuel burn and lower maintenance cost," he added.

On whether the "single largest order" had anything to do with the price, Leahy said the large order would normally come with slightly lower price "but that is not always the case".

"We give competitive prices comparable to what Boeing is giving in the market place right now for aircraft," he added.

Leahy said the the contract worked out to be a "profitable" deal for Airbus which was "pleased" with the transaction.

Airbus with the A320 family has over six percent of the market share for a single isle aircraft around the world.

LCC is very significant in the US and Europe, moving up close to 40 percent of the domestic regional market.

Airbus dominates the LCC market over the past two years.

However, Leahy said Airbus would not shift its focus to LCC even though there was strong demand for the aircraft.

"We are actually doing very well around the world. In fact, the A320 family has over 60 percent in the worldwide market. If we look at LCC market five years ago, those LCC would have bought B737 but now that are all buying A320 family," he said.

Airbus strategy is to win over the airlines to buy its improved aircraft.

-- BERNAMA

AirAsia expects lower air fare with Airbus fleet
By Tong Yee Siong


AirAsia Bhd’s air fare, already one of the cheapest in the region, would be lower with the purchase of 80 new Airbus planes that are set for delivery starting January 2006, says chief executive officer Tony Fernandes.

He said AirAsia chose Airbus A320 – a single-aisle model that can take up to 180 seats – after carefully studying the proposals from both Airbus and Boeing.

“The economics make a lot of sense in terms of fuel consumption and maintenance. With the superior performance and great support of Airbus, we believe we can reduce the cost, which is far lower than everybody else's. The tickets will be cheaper,” he told reporters in Sepang on Dec 17.

Earlier, AirAsia signed a memorandum of understanding with Airbus for the acquisition of 80 new aircraft, comprising 40 firm orders and 40 purchase rights.


Airbus chief commercial officer John Leahy (left) exchanging documents with Datuk Pahamin A Rajab, chairman of AirAsia, at the signing ceremony. Looking on is Fernandes (right).


This means as of January 2006, AirAsia will receive an A320 from Airbus every month for about three-and-a-half years, and has options to acquire up to 40 more after that.

Fernandes said AirAsia was likely to exercise its purchase rights for the second batch of 40 aircraft.

He said one-quarter of the RM865.4 million proceeds from its initial public offering exercise last month would be used to fund the purchase of the A320 planes.

Dow Jones, quoting sources familiar with the deal, reported that AirAsia would pay between US$32 million (RM121.6 million) and US$35 million for each plane, which is about half of the aircraft's US$65 million catalogue price.

Fernandes said AirAsia had also engaged consultancy firms to study other options of financing to make up for the balance of payment.

“We have a lot of choices; we feel very comfortable on the financing,” he said.

He said the new aircraft would be used by AirAsia for its operations in Malaysia as well as the joint-venture operations in Thailand and Indonesia.

As for the engine type, General Electric was “in the lead” although AirAsia had yet to make a final decision, he said.

AirAsia currently operates 24 Boeing 737-300 aircraft – 19 are leased and five owned – with 148 seats each. The latest aircraft purchase signals the gradual shift of AirAsia’s fleet towards Airbus.

Meanwhile, Airbus chief commercial officer John Leahy said it was in discussions with an “international airline” for a possible order of up to 10 A380 models, a double-decker jumbo plane that can carry 555 passengers.

He said Airbus had received orders for over 325 planes and was likely to control over 55% share of the orders for new planes worldwide this year.

Established in 1970 as a European consortium of French, German and later, Spanish and UK companies, Airbus had received orders from, among others, Jetstar Asia, Tiger Airways, Spirit Airlines and Virgin America over the past year.

AirAsia flew in almost 500,000 tourists in a year
Anna Maria Samsudin

AirAsia has brought almost 500,000 tourists — mostly Europeans and Australians — into Malaysia in less than a year since it introduced its Thailand and Indonesia flights.
Chief executive Tony Fernandes said the presence of a budget airline service in the region has encouraged intra-regional travelling.

And as a result of this, Asean now is gradually seen as one destination, instead of the individual countries representing the region.

Capitalising on its low fare, he said AirAsia was able to bring in more Australian tourists into Malaysia through its Bali flights and European tourists through Bangkok flights.

"Our low fares enable tourists to visit more than one Asean country and I see a huge potential in budget travel helping to beef up the tourism sector in the region," Fernandez said.

"Our main target right now is to promote Asean as one destination with Malaysia as the hub," he said in an interview.

Malaysia received 144,507 Australian and 264,557 European tourists last year. The average spending for an Australian tourist is RM3,000 while a European tourist, depending on which country he is from, spends RM2,100 to RM3,500 per stay.

However, some quarters believe that budget airline passengers will not bring in as much money into the country as those travelling on full service flights.

But Fernandes described this as a short-sighted view. Looking at the wide range of tourism products available in the country catering to various markets, he said it was vital for Malaysia to have a mixed class of tourists.

"What is the point of having two- and three-star hotels in Malaysia if we are only interested in attracting upmarket visitors?" he said.

"Besides, one should remember that these budget tourists could be CEOs or big shots one day. I was a former backpacker during my student days and today, I am a CEO of an airline company." Fernandes also said more than 50 per cent of the hotel bookings made through its "Go Holiday" programme (AirAsia's online do-it-yourself holiday package) were for five-star hotels such as Shangri-La. "I think budget airline service allows travellers more flexibility in planning their holidays." "Yes. they are paying less on travel expenses but they would have more money to spend on other things such as staying in a better hotel

Business Times - 21 Dec 2004

AirAsia targets passengers on Malaysia-originated routes

KUALA LUMPUR - Malaysian budget carrier AirAsia said on Tuesday it would hit 20 million passengers a year by 2009 on its Malaysia-originated routes if the government lets the airline use the nation's old main international airport.

AirAsia, the region's largest low-cost airline, is seeking government permission to operate out of Malaysia's former main airport in Subang, instead of the Kuala Lumpur International Airport, located around an hour's drive from the city.

AirAsia, which operates in Thailand, Indonesia and Malaysia, expects passenger volume to hit 8 million this year, and is aggressively pursuing expansion plans.

The airline announced last week a deal to buy 40 Airbus A320 passenger jets as part of those plans.

"We believe we can put 20 odd million passengers (a year) in Subang within five years," AirAsia Group Chief Executive Tony Fernandes said at a news conference on Tuesday.

Mr Fernandes added that AirAsia will be able to cut fares by up to 15 per cent if it operates from Subang. "Airport costs can go down 30 per cent," he added, without elaborating.

The old airport at Subang has been used primarily for charter and private aircraft since Malaysia opened the high-tech Kuala Lumpur International Airport in 1996 and pressured airlines to move operations there.

The government is considering a proposal for a dedicated low-cost carrier terminal at either airport. It is expected to make a decision in January, Mr Fernandes said.

Copyright © 2004 Singapore Press Holdings Ltd. All rights reserved.

AirAsia says can do 20m passengers with Subang
By Tong Yee Siong


AirAsia Bhd is confident that it can grow its passenger volume to over 20 million per annum within five years if it is allowed to operate from Sultan Abdul Aziz Shah Airport in Subang.

Its chief executive officer Tony Fernandes said the operating costs for the company could be cut by as much as 30%, leading to a reduction in air fare by “at least 10% to 15%”.

“We can do some 25 million passengers at the low-cost carrier (LCC) hub in Subang and KLIA (Kuala Lumpur International Airport) can do another 25 million passengers, and this is good for everybody.

“It is difficult to have 50 million passengers from KLIA because the airport is built for only 25 million passengers per year,” he told a media briefing on AirAsia’s proposal to the government in Subang on Dec 21.

AirAsia expects passenger volume of about 4.5 million in Malaysia this year, plus another 3.5 million from its operations in Thailand and Indonesia.

Fernandes said AirAsia might not be able to maintain its ticket price at a level lower than that of its competitors’ in the long run if it continued to operate from the Sepang-based KLIA.

“We are looking at only two countries –- Thailand and Indonesia, which make up very small part of MAS’s (Malaysian Airline System Bhd) revenue. So don’t penalise us by not giving us Subang,” he said.

AirAsia has been asking the government to allow it to operate from Subang, but MAS says a new LCC terminal at KLIA is adequate to transform Malaysia into a passenger as well as cargo hub.

Transport Minister Datuk Seri Chan Kong Choy had said the government would decide by early next year on the proposal to reopen Subang Airport for budget carriers.

AirAsia executive for strategic planning Rui Vaz Fernandes said reopening Subang Airport was a “once-in-a-lifetime opportunity” and a decision against this would harm Malaysia’s position as the regional aviation hub in the next 20 to 25 years.

“This year, KLIA is handling more than 20 million passengers. In 2006, the volume will exceed the current capacity and an expansion under Phase II will have to come.

“If low-yield domestic traffic is moved out of KLIA, it will be another six years or so before the capacity has to be expanded. The airport can then free its capacity for high-yield flights,” he said.

Rui Vaz said an expansion under Phase II would cost billions of ringgit and it would increase KLIA’s charges and make it lose its competitive edge.

In terms of airport charges for domestic flight, KLIA was already the most expensive at RM677, compared with Indonesia’s Sukarno-Hatta Airport and Thailand’s Don Muang Airport which charged RM291 and RM468 respectively, he said.

He also said a new LCC terminal would not solve the problems faced by budget carriers such as AirAsia at KLIA.

“The runway is too congested during peak times and there are separation issues especially with large aircraft like (Airbus) A380 that MAS will be getting in a few years,” he said.

In contrast, Subang Airport would offer simpler facilities –- such as basic passenger steps instead of aerobridge, quicker turnaround time, lower loading charges and fewer delays, he said.

He said an LCC hub in Malaysia would also attract other operators into the country and present the aviation industry with huge growth potential, as seen in the case of Stansted Airport in London, whose volume grew to some 20 million passengers in 2003 from about three million in 1994.

Owned by BAA Plc, Stansted is now the fourth busiest airport in United Kingdom after it was turned into the hub for numerous discounted flight routes.

Rui Vaz said the growth at Stansted did not affect Heathrow Airport in London, also operated by BAA.

“It does not make sense to require two airlines to be at the same airport. Infrastructure must be built to meet the demand of airlines and the location is important for LCCs,” he said.

He added more countries were adopting the two-airport strategy, such as Frankfurt-Main and Frankfurt-Hahn in Germany and Fiumicino and Ciampino in Rome.

“Jetstar Airways (Australia’s latest low fare airline) is another good example. It is owned by the national airline Qantas, which operates at Melbourne International Airport. But Jetstar is at Avalon Airport. This is what’s happening around the world,” he said.

He dismissed as “myths” arguments against the reopening of Subang Airport for LCCs. Some quarters have said that MAS might lose all its domestic traffic to LCCs and that KLIA’s connectivity could be substantially reduced.

But Rui Vaz said it was not true that MAS would lose all domestic traffic. “It will lose some point-to-point traffic to Subang Airport but will keep its inter-connecting traffic from domestic to international flights.”

He also said KLIA’s connectivity would be intact, as a passenger travelling from London to Johor Bahru via Kuala Lumpur, for example, would end up paying more, waiting longer hours and taking more hassle for an AirAsia transit flight to the final destination.

He said the reopening of Subang Airport would create more employment opportunities instead of causing job loss.

“We estimate that some 3,000 new jobs will be created in AirAsia, and 1,500 new jobs for the airport for every additional 10 million LCC passengers. This will create another 4,500 jobs in industries supporting air travel.

“MAS can redeploy its personnel to support regional and international expansion and it will be the same number of frequencies and jobs for them,” he said.

AirAsia had pledged up to RM100 million for the refurbishment of the Subang Airport to suit the need of LCCs.

AirAsia Is Prepared To Operate In Subang Airport, Says Fernandes


PETALING JAYA, Dec 21 (Bernama) -- AirAsia Bhd has again appealed to the government to allow them to shift their operations to Subang airport, stating a cut of over 20 percent in its operating costs as one of the main reasons for the proposed move.
In a media conference Tuesday, group chief executive officer of AirAsia, Tony Fernandes said the group was even ready to operate in Subang in the next 12 months, should the government allow the former Sultan Abdul Aziz Shah International Airport to be converted into a hub for budget carriers.

"We just need a simple, down-to-earth terminal to operate," he said.

The government, on the other hand, has yet to give an indication on whether to convert the former Subang airport into a dedicated terminal for low cost carriers.

Decisions are expected to be out by year end, with the Minister of Transport was quoted as saying that the government was still studying the proposal, which would then be presented to the cabinet for approval.

AirAsia had previously presented their proposal to the government, stressing that Subang would be ideal for low cost carriers to operate, whilst playing rival to neighbouring Singapore, which is emerging as a main hub for low-cost carriers.

Fernandes in his presentation to the media said, that the idea would fall into places once the Subang terminal receives about 20 million to 25 million of AirAsia passengers in the next five years.

He reiterated that Subang Airport could provide a lower cost base for operations compared to the Kuala Lumpur International Airport (KLIA), namely no aerobridges, reduced fuel burn to shorter taxi times, flight times, lower rentals on office space and check-in counters.

Fernandes said the government should see the market segmentation of between KLIA and Subang, thus suggesting "two airlines - two airports" policy which is needed to cater for different market and facilities.

He added that by taking the low yielding domestic operations out of KLIA, congestion during peak hours in the international airport could be further reduced.

-- BERNAMA

Business Times - 23 Dec 2004

AirAsia records US$2.7 million profit in first quarter

KUALA LUMPUR - Malaysia's budget airline AirAsia has posted a net profit of US$2.7 million for the first quarter of its financial year.

The airline said its revenue totalled US$32.6 million during the first quarter, which ended Sept 30.

AirAsia -the region's biggest budget carrier-did not provide comparative figures because it just listed on the bourse in November.

The airline said it expects its financial performance for the year ending June 30 to be 'satisfactory.'

For the year ending June 2005, AirAsia expects net profit to reach US$42 million.

AirAsia, which currently serves routes in Malaysia, Indonesia and Thailand, carried 1.8 million passengers in 2003, and an estimated 3.2 million passengers this year.

It expects passenger numbers to rise to 6 million in 2005.

AirAsia is aggressively pursuing expansion plans and has signed a deal to buy 40 Airbus A320 passenger jets.

Copyright © 2004 Singapore Press Holdings Ltd. All rights reserved.

Thursday January 20, 2005
AirAsia awaiting go-ahead for flights to Indochina

BY HANIM ADNAN
AIRASIA Bhd is currently waiting for the go-ahead to fly to Indochina countries such as Vietnam, Cambodia and Laos as well as seriously looking at prospects in the China market this year.

The low-cost carrier will also focus on its two existing joint ventures in Indonesia and Thailand, said group chief executive officer Tony Fernandes.

AirAsia currently operates over 100 domestic and international flights daily with its fleet of 18 Boeing 737-300s from its hub in KL International Airport (KLIA) in Sepang and Senai International Airport in Johor.

Its joint venture in Thailand through Thai AirAsia operates six Boeing 737-300s from Bangkok International Airport while its partnership with Indonesia's AWAIR operates two Boeing 737-300s from Jakarta's Soekarno Hatta International Airport.

Fernandes was speaking to reporters after the company received Euromoney magazine's “Best Managed Company in the Airlines and Aviation Sector” award under the magazine's annual Asia Best Managed Companies poll in Kuala Lumpur yesterday.

“We will continue to stick to our existing business model – to provide the lowest fare at the lowest cost,” Fernandes said, adding that AirAsia had revolutionised air travel in Malaysia to become a leading low-fare airline in South-East Asia.

http://biz.thestar.com.my/archives/2005/1/20/business/p3-airasiai.jpg
From left: AirAsia Bhd chairman Datuk Pahamin A.Rajab, Euromoney Magazine managing director Simon Brady and AirAsia group chief executive officer Tony Fernandes after Euromoney's "Best Managed Company in the Airlines and Aviation Sector" award presentation to AirAsia in Kuala Lumpur Wednesday.

“This year our focus will not just be new routes or joint ventures but on putting the building blocks in place for our next phase of growth.”

He said AirAsia would concentrate on training its staff, such as engineers and pilots, with emphasis on quality services to passengers.

On the Government's decision to build a dedicated low cost carrier (LCC) terminal, he said an announcement was expected after Chinese New Year next month.

“We will be satisfied irrespective of the location chosen, be it to revive the old Subang airport or the KLIA in Sepang,” he added.

Earlier, at the award presentation, Euromoney managing director Simon Brady said AirAsia had beaten several established airlines in Asia such as Virgin Blue, Malaysia Airlines and Singapore Airlines for the award.

The award was based on the magazine's Asia best managed companies poll of 47 leading global equity analysts and financial institutions.

EPL ticket for AirAsia
By Tony Emmanuel



Malaysia’s home-grown budget carrier AirAsia is a step away from sponsoring an English Premier League club.
The club is believed to be Everton and negotiations are in the final stages. Should the deal be concluded, AirAsia will have its name emblazoned on Everton's jerseys for the 2005/06 season.

While no official confirmation was forthcoming, a source said that marketing agents representing Chelsea, Arsenal, Manchester United, Everton, Liverpool and Middlesbrough are in Kuala Lumpur for negotiations with interested parties.

The source added that several proposals were being tabled for the consideration of corporations and the Government.

Following Proton's sponsorship success with another Premiership side, Norwich City, marketing agents from Britain have been selling the concept that corporate endorsement in the EPL is a highly attractive marketing option.

"It's not only an opportunity to make one's presence felt in the English market, but the EPL has a worldwide television audience of more than 350 million in 100 countries." It will be a perfect opportunity for AirAsia to expand its horizon in the region.

Everton's current jersey sponsor is Chang Beer, Thailand's largest brewer. The £1.5 million (RM10.5) deal ends in May.

AirAsia to ‘sell’ KL via football
Tony Emmanuel

No-frills airline AirAsia’s plan to sponsor an English Premier League club is part of founder Tony Fernandez’s plan to promote Kuala Lumpur as a travel destination.
Chelsea FC’s partnership with Middle Eastern carrier Emirates has brought Dubai immense benefits, and he is hoping to do the same for Kuala Lumpur.

"We are in the final stage of negotiations with parties representing Everton FC," said AirAsia's group chief executive, confirming a New Straits Times report today.

"From (Kuala Lumpur), we can transfer European tourists to popular destinations in the country, even to Jakarta and Bangkok," Fernandez told NST.

Connections would be at fares which are "absolute bargains" to the average European traveller at prevailing exchange rates, he said.

NST has learnt that the budget carrier was not the only airline being courted. This means Fernandez is keeping his fingers crossed that AirAsia’s offer to counter that of a foreign airline will be accepted.

London agents representing Everton FC, now in Kuala Lumpur, began courting corporate sponsors from Malaysia after word leaked a club sponsor was considering a deal with a rival side.

Thailand's largest brewer Chang Beer, which sponsors Everton’s jerseys, may be considering an offer from a far more popular Merseyside team, Liverpool.

Chang Beer’s £1.5 million deal with Everton ends in May, but comes with an option for another year.

Having AirAsia emblazoned on Everton’s jerseys is just the first step.

"This is merely part of the entire corporate endorsement package I envision," said Fernandez.

Fernandez likened AirAsia to Everton , which has more than 500,000 card-carrying fans and a global market for replica jerseys.

"AirAsia, like Everton, may not have the track record as other top airlines, but we are getting there."

The club’s fourth place in the EPL makes sponsoring its jerseys an ideal way for AirAsia to make itself known to English travellers.

If Everton maintains its position until the end of the season, it would qualify for the 2005/2006 Champions League, which would bring substantial television coverage.

AirAsia’s Indon venture may cancel flights to Singapore

PT AWAIR International will cancel daily flights to Singapore from Jakarta if it doesn’t get approvals on the service from regulators.

AWAIR, the Jakarta-based airline 49%-owned by AirAsia Bhd, had more than 2,000 passengers booked on its S$20 service to Singapore until Jan 26, said chief executive Tony Fernandes.

The airline cancelled plans to begin the service on Jan 19 and may scrap it altogether because Singapore regulators had held up approvals for the flights, he said.

“We don’t need to come to Singapore,” Fernandes said at the Asia-Pacific and Middle-East Aviation and Tourism Outlook conference in Singapore yesterday. “If we’re not welcome, we will find alternative routes. Our patience is surely not endless.”

AirAsia’s plan to scrap its Jakarta-Singapore service may spoil the government's plan to present Singapore's Changi airport as an aviation hub for South-East Asia.

Transport Minister Yeo Cheow Tong offered yesterday to cut landing fees and hand out other financial incentives to attract airlines to route their services via Changi.

Tourism receipts contribute to more than 5% of Singapore’s US$91bil economy every year. The government has begun building a new airport terminal at Changi to attract the 10 low-fare airlines that are flying in South-East Asia.


Tony Fernandes
The Civil Aviation Authority of Singapore (CAAS), the regulator, is “reviewing documents it has received from AWAIR,” said the authority’s spokeswoman Yip Siew Joo, in an e-mailed reply to Bloomberg’s queries.

“In the interest of the travelling public, CAAS will have to ensure that AWAIR has met all the necessary regulatory requirements before the approval can be granted.”

Thai AirAsia Co, AirAsia’s venture in Thailand, flies four times a day to Singapore, and had no problems getting approvals to land in the city, with the same documentation, Fernandes said.

“It’s not like we’re an unknown airline,” he added. “People know our technical standards. We're the same company.”

AWAIR International has two Boeing 737-300 aircraft leased from AirAsia flying within Indonesia and overseas.

AirAsia was likely to triple its 2004 profit to RM147.4mil in the 12 months ending June, meeting its profit target, Fernandes said.

“We’re on track despite the tsunami (disaster) and (rising) fuel price,” he said. “We’re expecting loads and yields as we’ve predicted in our initial public offer documents.”

AirAsia plans to fly to China in April. It would seek permission to fly to Cambodia, Laos and Vietnam from Kuala Lumpur and Bangkok, Fernandes said on Jan 19, without saying when the services to Indo-China would start. – Bloomberg

AirAsia may give up expansion into Singapore



HAVING undergone a tough time to launch its latest flight from Jakarta to Singapore, AirAsia Bhd chief executive officer Tony Fernandes says he has had enough of Singapore’s tactics and the airline may give up completely its interest to expand there.

The Singapore government is currently deciding whether to allow AWAIR, an AirAsia 49% associate, to operate flights from Jakarta after halting its maiden flight at the eleventh hour recently for allegedly not having a full documentation.

Addressing an audience comprising bankers and senior officials from regional financial institutions at the 5th Malaysia Capital Market Conference 2005 in Kuala Lumpur, Fernandes did not mince his words about the treatment he had received from the Singapore government.

He said the latest incident reflected how the Singapore government had tried to block the entry of low-cost carriers (LCCs) such as AirAsia from competing directly with the republic’s homegrown LCC and its national airlines Singapore Airlines (SIA) and Silk Air. There are currently three LCCs based in Singapore - SIA-owned Tiger Airways, Qantas-owned Jetstar Asia and privately-owned Valuair.







http://biz.thestar.com.my/archives/2005/1/26/business/p5tony.jpg

Tony Fernandes







“First they barred our bus from entering Singapore, now they have barred us from taking our planes there despite their earlier approvals,” he said.

He said his experience showed that Singapore was not as open to business as they had portrayed itself to be.

“From our experience, they are very closed and we want to tell the whole world about it,” said Fernandes, who left the conference audience in stitches with his straightforward presentation style.

He said the decision to stop AWAIR flight had upset the Indonesian authorities and disrupted the travel plans of passengers who had made their travel bookings earlier.

Fernandes said he was prepared to face the consequences for being vocal about the treatment he received from the Singaporean government.

“After this, we may cancel our intention to fly to Singapore from Jakarta,” he said, adding that AirAsia could grow well without having to operate from the island.

Fernandes also said AirAsia was on track to achieve its forecast profit of RM172.8mil for its financial year ending June 2005.

“Our second quarter result had been encouraging, and we are confident of achieving our target,” he said, but declined to elaborate.

oops..smart? not smart? hmm.....final opinion. not smart move by Mr.Fernandes. He should use every trick in the book (or perhaps he is currently doing so) in order to fly out of Singapore. Too lucrative a market to ignore. To do so would be to look the other way at a bundle of cash being smacked in his face...aiyaiyai

Totally agreed with liping. If Jetstar can, why not AirAsia? :cool:

Totally agreed with liping. If Jetstar can, why not AirAsia? :cool:

May be because it is not "buddy-buddy" with AirAsia.

What you guys think about the Malaysia-Singapore, Asean or the Whole Asia pacific on open skies policy? how far they agree? would they? You??

I'm very much pro liberalizing aviation and less nationalistic in term of the skies policy...eventually benefit me and others.(?)
of course there must be strong argument from the 'conservativist', trained economist, decision maker which I don't know

Totally agreed with liping. If Jetstar can, why not AirAsia? :cool:


Hmmmm.....firstly.....Jetstar Asia is a Singaporean home-grown LCC despite Qantas being a shareholder. It had a significant local shareholding. Secondly, AWAIR isn't a Singaporean company but an Indonesian. Furthermore I am not too sure if this had any bearing on the decision by CAAS as AWAIR are co-owned by AirAsia :D

Anyway, AirAsia had very little to lose as it is already in a way operating out of the Republic with its subsidiary Thai AirAsia. But I do hope they could operate a subsidiary out of Singapore ;)

What you guys think about the Malaysia-Singapore, Asean or the Whole Asia pacific on open skies policy? how far they agree? would they? You??


Well.....as far I am concern.......I fully support an open skies agreement since most Malaysian routes or destination isn't a major one so we had not much to lose. Furthermore, Malaysia isn't a jet-setting nation to begin with ;)

As a consumer, I would definitely support such policy. Look at how Singapore benefitted from open-skies agreement since their beginning of nationhood. It had literally made them a hub and SIA being a home-grown carrier had tremendously benefitted from such policy. Being a city-state too had its benefit as it is not a multiple destination country.

Should such policy been implemented, MAS might suffer a lil but not as bad as before because they now have no burden on domestic operations anymore. In fact MAS would be on head-to-head competition with SIA should Malaysia opens up its skies which IMO a good thing :)

AirAsia wins low-cost airline of 2004 award

LOW-FARE carrier AirAsia has been named the Asia-Pacific Low-Cost Airline of the Year 2004 by the Centre for Asia-Pacific Aviation (CAPA).

The award was presented by Binit Somaia, the Centre's regional director for Indian subcontinent, at a gala event during the Asia-Pacific & Middle East Aviation and Tourism Outlook 2005 conference held in Singapore recently, an AirAsia statement said yesterday.

AirAsia also walked away with two other CAPA awards, including the Asia-Pacific Aviation Executive of the Year (2004), clinched by its group chief executive officer, Tony Fernandes.

It also bagged the inaugural Asia-Pacific Low-Cost Advertising Award for Best Asia-Pacific/Middle East Low-Cost Airline Print Advertisement 2004.

The CAPA awards are presented annually to Asia-Pacific and Middle Eastern personalities and organisations doing the most to influence business and regulatory strategy in ways that will have a lasting and irreversible impact on the evolution of the aviation and tourism industries. – Bernama

AirAsia To Set Up Low Cost Carrier In China

KUALA LUMPUR, Jan 31 (Bernama) -- AirAsia, one of the largest and most successful low-cost carriers (LCCs) in Asia, is planning to set up a LCC venture in China with Chinese partners.

Sources from the aviation industry and Air Asia confirmed that the LCC was planning to set up operations in lucrative China once it obtains the nod from the Chinese government.

"That will be a new business entity, similar to the Thai AirAsia model. But we are still discussing with the Chinese authorities on the shareholding structure," the source, requesting anonymity, told Bernama.

Based on the Thai AirAsia model, the Thai partner took up a 51 percent stake while AirAsia holds the other 49 percent.

"As for the China model, we have yet to finalise the composition of the shareholding. We are still talking to them," he said.

However, the source declined to name the parties they were talking to in China except that an announcement would be made "after it has been finalised."

A Malaysian government source said the shareholding in the joint venture in China was yet to be finalised as there were reservations by the Chinese authorities over the composition of the equity between local parties and foreign partners.

However, it is understood that the Chinese authorities were insisting that Chinese parties hold a majority stake in the eventual venture, along the lines of the Thai AirAsia venture, where locals hold 51 percent local and 49 percent held by Malaysia's AirAsia.

"The shareholding not a major problem as it can be worked out. The most important is that we are going to set up the LCC in China," the source said.

Asked when the joint venture would begin operations, he said that it would probably start once the required number of airplanes has been gotten by way of leasing them."

He said AirAsia was facing a shortage of airplanes at the moment for the China venture.

AirAsia is considered one of the largest LCCs in the region, with a fleet of 24 aircraft, which it expects to increase to 36 by the middle of this year.

Asked if China AirAsia would be based in Xiamen, as the airlines plans to fly to the city, the source said: "It has yet to be decided as we have several cities under consideration."

AirAsia is targeting markets within 3.5 hours flight time from its hub, which gives it access to a 500 million population within Southeast Asia with operations in Malaysia, Thailand, Indonesia.

Now it is targeting China, India and the Philippines.

AirAsia's Fernandes Joins List Of 40 Richest Malaysians


KUALA LUMPUR, Feb 17 (Bernama) -- AirAsia's chief executive officer Tony Fernandes whose colourful past include from being an accountant to handling a recording company, has catapulted to the ranks of Malaysian Business magazine's 40 Richest Malaysians for 2005.

Fernandes who had worked for Virgin Atlantic before becoming the vice-president (South East Asia) for Warner Music Group, was placed at 15th spot with a wealth of RM763 million.

Sugar King Robert Kuok Hock Nien was again in the top spot with a wealth of RM16.96 billion, followed by communications tycoon T. Ananda Krishnan at RM12.23 billion and Tan Sri Quek Leng Chan of the Hong Leong Group at RM8.97 billion.

Kuok, who owned the Kerry Group/Kuok Group, saw his wealth increasing by 19 percent and that of Quek by 9.8 percent while Krishnan's wealth had diminished by some five percent from last year, according to a statement released by Malaysian Business here Thursday.

It said as a whole, the rich fared better in 2005 than in 2004 due to a better economy with total wealth growing by 15 percent to RM78.2 billion against RM67.6 billion a year ago.

The list which appeared in the latest issue of the magazine also ranked Genting Group's Tan Sri Lim Goh Tong in the 4th spot at RM6.87 billion, Public Bank's Tan Sri Teh Hong Piow at 5th spot with a wealth of RM6.11 billion and Tan Sri Lee Shin Cheng of IOI Group, 6th, with RM2.78 billion.

At the 7th spot was Malaysia Mining Corporation's Tan Sri Syed Mokhtar AlBukhary with RM2.696 billion, 8th was Genting Group's Tan Sri Lim Kok Thay RM2.038 billion, 9th was Rimbunan Hijau's Tan Sri Tiong Hiew King RM1.786 billion and YTL's Tan Sri Yeoh Tiong Lay at the 10th spot with RM1.5 billion.

New faces joining the list include AirAsia's Kamarudin Meranun who was placed 18th at RM633 million and Datin Yam Yuet Chew who controls property developer Fountain View Development Bhd at 19th spot with RM630 million.

Others in the top 20 list were MK Land's Tan Sri Mustapha Kamal Abu Bakar at 11th spot with RM1.025 billion, IOI Group's Datuk Lee Yeow Chor at 12th spot with RM895.85 million and Berjaya Group's Tan Sri Vincent Tan Chee Yioun was placed 13th with RM842.54 million.

Ranhill Group's Tan Sri Hamdan Mohamad ranked 14th at RM780.15 million while at 16th place was YTL Group's Tan Sri Francis Yeoh Sock Ping RM649.26, and at 17th Sunway Group's Tan Sri Jeffrey Cheah Fook Ling RM637.41 million and at 20th place was Datuk Seri Lau Cho Kun of Malaysian Mosaics with RM589.07 million.

Other new entrants include founder of world's largest rubber glove manufacturer Top Glove Corporation Datuk Lim Wee-Chai and self-made private investor focusing on technology-based companies Datuk Ahmad Kabeer Mohd Nagoor.

MAA Holding's Tunku Datuk Yaacob Tunku Abdullah makes a re-entry after a year's absence, the statement said.

-- BERNAMA

AirAsia Records RM56 Mln Pre-Tax Profit For Half Year Period


KUALA LUMPUR, Feb 18 (Bernama) -- No- frills airline, AirAsia Bhd recorded RM56.347 million in pre-tax profit on a revenue of RM302.831 million for its first half year financial period ended Dec 31, 2004.

In terms of quarterly results, it posted RM45.722 million in pre-tax profit for the second quarter as against the RM35.1 million in the first quarter. Revenue for the second quarter was RM178.633 million.

"The profit for the second quarter is higher than the first quarter mainly due to higher demand for air travel during the months of October to December. This pattern is in line with forecasts and expectations of the group," said the budget carrier in a statement Thursday.

AirAsia said although its load factor for the quarter dropped to 73 percent from 77 percent as a result of the introduction of new routes, the number of passengers that it carried jumped to 1.126 million from 984,621.

In addition, its average fare during the quarter rose RM31 to RM153 from RM122 per passenger carried. The increase was mainly due to improvement in yield coinciding with the festive or holiday seasons.

As for its associate company, Thai AirAsia, the company said it was affected by both price competition and the availability of fewer aircraft than originally forecasted.

AirAsia, which was listed on Bursa Malaysia on November 22 last year, said that performance in the second half year could be impacted by delays in acquiring sufficient aircraft on a timely basis to meet its expansion programme.

Other factors that might influence its current financial year include the continuing high level of fuel prices and start up losses to be incurred in its Indonesian venture.

-- BERNAMA

AirAsia replicates its model in Thailand, Indonesia
Saturday February 19, 2005




StarBiz associate editor C.S. Tan interviews AirAsia CEO Tony Fernandes on the airline's operations in Thailand and Indonesia. Excerpts. STARBIZ: According to reports, Thai AirAsia lost money in its first year.

Fernandes: It lost money in '04. But, we're still thrilled with its performance. It had to deal with the bird flu, tsunami and a lot of competition. All its capital is intact and it's cashflow-positive now.

StarBiz: AirAsia forecast that Thailand would contribute RM14mil (about 9%) out of total group earnings of RM160mil for the year to June 30, 2005. Will the tsunami disaster affect this forecast?

Fernandes: The tsunami has affected us a bit; it affected inbound traffic to Thailand, not only to Phuket but Bangkok as well.

AirAsia has survived everything that's been thrown at us. SARS (severe acute respiratory syndrome) - who had heard of SARS before? There was also the tsunami, high fuel prices and stiff competition, but we've survived.

StarBiz: Will Thailand be profitable in the second year (2005)?

Fernandes: That will depend on whether we'll get the (additional leased) planes on time.



StarBiz: Are the flights to China firmed up by now?

Fernandes: Thai AirAsia will fly to Xiamen and a few other cities. There is an open sky agreement between Thailand and China, so we'll be able to fly there.



StarBiz: What is the reason AirAsia will fly to China from Bangkok, and not from KL?

Fernandes: Bangkok-China is three hours, the right radius, although we're also flying to Macau, which is three-and-a-half hours, which is a little far for us.

Malaysia-China would be four or four-and-a-half hours. The plane would be gone the whole day; you could probably do one more flight.

Bangkok is two-and-a-half hours from the Pearl River Delta (where Guangzhou and Hong Kong are). We can easily do three flights. Bangkok will also be where we'll be flying to India, but there is unavailability of landing rights. Thailand is negotiating for it.

StarBiz: This is only the second month for AWAir (49%-owned in Indonesia). But AirAsia has been a fast grower. How is it doing in Indonesia?

Fernandes: We're getting a load factor of more than 80% in a very competitive market. We're competing with 10 airlines on the Jakarta-Surabaya route. Yet we're getting a load factor of 80%. Our break-even level is 56%.



StarBiz: How many passengers are you getting in Indonesia?

Fernandes: We have two planes and we didn't have a full schedule because of the problem with Singapore. This month, we should do about 50,000 (passengers). I believe we'll do one million this year.

The market in Indonesia is very elastic. You put in the planes and you'll fill it if the fares are right.



StarBiz: Will AWAir be profitable in its first year?

Fernandes: It has the potential to be profitable in its first year.

RM4bil value for successful AirAsia business model
Saturday February 19, 2005


AIRASIA has shown that it can execute a low-cost carrier model successfully in Malaysia and is well on its way to proving itself in Thailand and Indonesia as well.

“We've never changed our model in the last three years,” CEO Tony Fernandes said. It is disciplined in its business model.

“We want our fares to be low. We want to reach the low-end of the market. MAS is like this hotel (StarBiz met him at the KL Hilton where he had other meetings). Budget airlines are like the budget hotels,” he said.

AirAsia has been a very successful model. In just three years, AirAsia Bhd has grown from a two-plane airline into a company with a market capitalisation of more than RM4bil.

It had bought AirAsia from DRB-HICOM Bhd and today, its market capitalisation is almost double DRB-HICOM's market capitalisation of RM2.1bil.

As Fernandes put it, AirAsia has provided one of the fastest appreciations ever in shareholder value in Malaysia.



http://biz.thestar.com.my/archives/2005/2/19/business/p2-kamarudin.jpg

Kamarudin Meranun



Although the cost structure is management's most important focus, it is not managed at the expense of employees. Staffers are paid well and last year, bonuses averaged three months, with seven months at the higher end.

Executive director Kamarudin Meranun, who came out of another meeting to briefly meet StarBiz, said stock options were given to employees before the initial public offer (IPO). So, employees received shares below the IPO price of RM1.16, and the share price has done well since then.

On a point as to the interests of Malaysia Airlines, the national carrier, Fernandes pointed out that AirAsia is a bumiputra company. Three bumiputras own 52% interest in the equity of Tune Air, which in turn owns about 45% of AirAsia.

The largest bumiputra shareholder is Kamarudin. In addition, 70% of AirAsia's staff are bumiputras.

Fernandes said he is the spokesman so often that people think he is the majority shareholder. He is one of several substantial shareholders.

He believes AirAsia will continue to grow in spite of the presence of more budget airlines now. “Don't think no one tried to take on Southwest,” he said. Yet, Southwest has stayed ahead of the competition.

Although AirAsia's share price has moved up from its retail IPO price to RM1.78 yesterday, Fernandes said it is not a one-year story.

“Imagine, if you've invested in Southwest when they had 26 planes,” he said. This is the number of planes deployed by AirAsia today. Southwest expanded its fleet to 400 planes and was a growth stock for many years.

Even so, it is not Fernandes' job to deliver share price gains.

“I deliver lower costs every year. The market will decide what to price us,” he said. “We have achieved a lot in three years. Imagine what we can do in 10 years.”

AirAsia strives for high growth
Saturday February 19, 2005



BY C.S TAN

BUDGET airline AirAsia Bhd moved closer towards meeting the forecast profit it made when it launched its initial public offering (IPO) in October last year. It reported yesterday a net profit of RM44.4mil for its second quarter ended Dec 31, 2004, up sharply from the RM10.5mil earned in the first quarter.

However, AirAsia would have to earn much more to meet the forecast profit of about RM160mil for the year. It faces a few obstacles, one of which is it can't get more planes fast enough. Under its schedule, it should get one or two additional leased planes each month until November when it starts to get new planes from Airbus.

In announcing its results yesterday, AirAsia said delays in getting new aircraft might impact on earnings in the second half of its current financial year. It is understood the expansion of its associate airline companies in Thailand and Indonesia would be slowed by similar problems.

It appears that AirAsia is successfully replicating its business model in Thailand and Indonesia. Although the group started flying in Thailand a year ago and Indonesia just over a month ago, it has more customers than planes.

In December, AirAsia placed an order to buy 40 Airbus aircraft for US$2.5bil (RM9.5bil) but delivery will start only from November. Until then, the airline will lease planes but the lease market has tightened, possibly due to the launch of budget airlines throughout Asia.

AirAsia might be able to get all the planes it needs now but it would have to pay more. So it will fly, for instance, to China only when it can get more planes at the right price. “We don't want to sacrifice our cost structure,” group chief executive officer Tony Fernandes told StarBiz.

For that reason, the group may be able to fly to China only from April or May. It would fly to Xiamen and a few other cities from Bangkok, which is closer to China than Kuala Lumpur, he said. AirAsia will also fly to India from Bangkok when landing rights are obtained.

“The future in Thailand will be more international, but our main hub will be KL,” Fernandes said. Kuala Lumpur would be the main hub as it is equidistant between Thailand and Indonesia, he added. “We have to get the home base right. That's why we're fighting so hard for Subang (airport),” he said.

AirAsia has made a case to the Government to use the old Subang airport instead of a proposed new terminal for low-cost carriers (LCCs) at KL International Airport.

Fernandes said AirAsia's position was similar to that of Dallas-based Southwest Airlines, the pioneer of budget airlines. When Dallas built a new airport outside the city, it closed its old airport that was near the city. But the city made the right decision in allowing Southwest to remain at the old airport, he said.

Southwest, which had just five planes then, has 400 planes today.

The model for LCCs, according to a brokerage report, required that such airlines used secondary airports - where landing fees are cheaper - as their hub.

“Subang would be a win for Malaysia,” Fernandes said. There is a chance for Malaysia to have a homegrown budget airline that will continue to lead in the industry in the region. AirAsia wants to be the RyanAir and Southwest of Asia. We deserve a chance. We never asked for money. Just give us a home,” he said.

The airline group has faced many obstacles, including the failure of AWAir, its associated company in Indonesia, to obtain landing rights in Singapore. Fernandes said AWAir would focus on domestic routes in Indonesia which have tremendous potential.

AirAsia tambah tempahan pesawat kepada 100 buah

KUALA LUMPUR 21 Feb. - AirAsia Bhd. (AirAsia) merancang untuk menambah bilangan 20 tempahan pesawat Airbus320, menjadikan jumlah keseluruhan pesawat yang dibelinya daripada Airbus SAS, kepada 100 buah.
Ketua Pegawai Eksekutif, Tony Fernandes berkata, syarikat penerbangan tambang murah itu memerlukan lebih banyak pesawat pada masa depan bagi menampung pertumbuhan penumpang dan penambahan laluan pada masa depan.

``Rundingan dengan pembuat pesawat itu sedang dilakukan.

``Saya tidak rasa 80 buah pesawat yang kita tempah mencukupi kerana operasi AirAsia di Indonesia sahaja mungkin memerlukan 80 buah pesawat. Thailand juga memerlukan pesawat,'' katanya.

Beliau menyatakan demikian pada sesi taklimat media mengenai prestasi kewangan suku kedua AirAsia yang berakhir 31 Disember 2004 di sini, hari ini.

Pada 17 Disember lalu, AirAsia memeterai Memorandum Persefahaman (MoU) dengan Airbus SAS bagi menempah 80 buah pesawat A320.

Di bawah MoU itu, syarikat penerbangan itu menempah 40 buah pesawat yang akan mula dihantar pada Januari 2006 dengan opsyen membuat pembelian tambahan 40 buah pesawat lagi.

Difahamkan, di bawah perancangan baru itu, AirAsia akan menempah 50 buah pesawat dengan opsyen membuat pembelian tambahan sebanyak 50 buah pesawat.

Kini AirAsia beroperasi dengan 28 buah pesawat B737-300 di Malaysia, Thailand serta Indonesia dan syarikat akan melupuskan pesawat Boeing yang digunakan bagi operasinya ketika ini dengan pemilikan pesawat baru tersebut.

Sementara itu, Fernandes berkata, AirAsia telah berjaya menyewa 12 buah pesawat B737-300 dengan harga yang diingininya.

Bagaimanapun, tambah beliau, syarikat hanya akan mula menerima pesawat yang disewanya pada bulan Ogos depan.

Malaysia has decided to build a dedicated terminal for low-cost carriers at Kuala Lumpur's main international airport at a cost of US$26 million (RM98.8 million), Transport Minister Chan Kong Choy said on Feb 23.

The terminal at the cavernous airport in Sepang, about 70 km from the capital, will be managed by state-run Malaysia Airports Holdings Bhd, and will be operational in the first half of 2006, he said.

"It's a very strategic move to help Malaysia, and AirAsia and other low-cost carriers in the country," Chan told reporters after a weekly cabinet meeting at which the decision was made.

Malaysia wants to develop KLIA, the fastest-growing facility in the Asia-Pacific region, into a major regional hub in the face of growing competition from more established neighbours Singapore and Bangkok.

The government would spend RM100 million to build the terminal, Chan added.

Malaysian budget carrier AirAsia Bhd had lobbied hard for the terminal to be sited at the old airport in Subang, about 25 km from Kuala Lumpur.

AirAsia had argued that Kuala Lumpur International Airport (KLIA) was congested, and the airline would be better off at Subang, where it could turn around flights more promptly.

Chan said it would cost RM280 million to RM300 million to build a similar facility in Subang.

He said the new facility, the second dedicated low-cost carrier terminal in Asia after Singapore, would be able to handle 10 million to 12 million passengers a year, and ensure a quick aircraft turnaround of 20 minutes.

Several Singapore-based low-cost carriers have indicated interest in flying into KLIA, Chan said, but added there were no serious talks yet.

Chan said AirAsia is expected to fly a total of 7.5 million to 8.0 million passengers this year, against 3.4 million in 2004.

Low-cost airlines have mushroomed across Asia, sparking price wars and putting further pressure on main carriers to cut costs.

AirAsia hopes to emulate the success of European low-cost carriers such as Ireland's Ryanair Holdings Plc and Britain's EasyJet Plc. - Reuters

New KLIA terminal for budget airlines



By MERGAWATI ZULFAKAR



PUTRAJAYA: The Government has shot down AirAsia’s proposal to operate from Subang and instead decided to build a new terminal at the KL International Airport in Sepang for low-cost carriers (LCCs).

Transport Minister Datuk Seri Chan Kong Choy said the RM100mil terminal would be operational by the middle of next year and provide basic facilities for LCCs to operate.

“The decision is made as a strategic move to ensure the aviation industry in Malaysia continues to grow, and suits the country’s objective to develop KLIA as a regional aviation hub in the long term.

“The decision was made after the Government had considered the feedback by all stakeholders in the aviation industry, including the Department of Civil Aviation, Malaysia Airports Holdings Bhd, Penerbangan Malaysia Bhd, Malaysia Airlines, AirAsia and Board of Airlines Representatives,” he told reporters here yesterday.

Chan said the cost of the terminal was low because it would be different from ordinary terminals that catered to full-fare airlines.

“There will be simpler conveyor belts and no aerobridges, but it will be a comfortable terminal.

“We will fast-track the construction of the terminal, which will enable LCCs to have a fast turnaround time of 20 minutes. It can cater to 40 planes and 10 to 12 million passengers. It can also be expanded easily in the future,” he added.

Chan declined to identify the exact location of the terminal but gave the assurance that it would be linked to the main terminal by shuttle buses and other means of transportation.

He also said the terminal would enable all LCCs to achieve cost efficiency.

Asked why the Government decided to build the new terminal, Chan said KLIA had superb infrastructure in place, adding that if a new terminal was built in Subang, it would cost up to RM300mil.

“We also have some other plans for Subang,” he said.

“When we design the new terminal, we will get AirAsia to give input because it will be a major user,” he added.

Chan acknowledged the important role played by AirAsia in the growth of LCC operations and its contribution towards tourism.

“The Government will continue to support AirAsia to be the main LCC in the region, and at the same time the Government will continue to take strategic actions to enable MAS to be a successful global carrier,” he added.

Meanwhile, AirAsia chief executive officer Tony Fernandes said the budget airline would focus its energy on making the new terminal the centre for low-cost travel in Asia.

AirAsia targets KLIA's low-cost terminal as rival to S'pore



Despite losing the Subang bid, it will still work on the new terminal



By VEN SREENIVASAN

HAVING lost its bid to clinch Subang, AirAsia wants to make the proposed low-cost terminal in Kuala Lumpur International Airport (KLIA) into an efficient centre for low-cost travel to rival Singapore.

The Malaysian budget carrier said this in response to Malaysian Transport Minister Chan Kong Choy's remarks yesterday that the government would build a US$26 million terminal exclusively for low-cost airlines at the modern airport at Sepang.

The move was a big blow to AirAsia, which had lobbied hard for Subang to be reopened as a low-cost airport.

AirAsia's chief executive Tony Fernandes had insisted that his airline would enjoy cost savings of 30 per cent if it operates out of Subang.

But in a statement yesterday, Mr Fernandes said that despite losing the battle to get Subang, his budget carrier would work closely with Malaysia Airports Holdings Berhad (MAHB) to develop the country's first dedicated low-cost terminal.

'We are pleased that Malaysia Airports have delivered a blue print of KLIA that will almost mimic Subang in KLIA, even down to the low-cost transport to the terminal. Although AirAsia did not get Subang, our staff should be proud of the recognition received, as the creation of a new terminal would primarily benefit AirAsia.'

Subang airport, which is barely 15 km from Kuala Lumpur's city centre, was Malaysia's main airport until 1998 when it was replaced as the country's leading international airport by KLIA, which is about 70 km from the city.

Mr Fernandes said Subang would now be a maintenance, repair and overhaul (MRO) centre for AirAsia.

'AirAsia, who works closely with GE Engine Services Malaysia to maintain our aircraft engines, hopes to be able to contribute further to the development of the MRO to secure Malaysia as the leader in MRO and focus on strengthening its growth to rival Singapore.'

The KLIA low cost terminal is expected to be ready by the first half of 2006, shortly after Singapore's S$45 million low-cost terminal at Changi is ready during the first quarter of next year. So will it pose a serious threat to Singapore? Not really, said Shukor Yusof, aviation analyst at Standard & Poor's MarketScope. 'To be a serious threat, the parent airport has to be a serious contender in international aviation,' he said. 'KLIA still has some way to go before it can catch up with either Singapore or Bangkok.'

KLIA handled 20 million passengers last year - comprising a significant portion of domestic traffic - compared to more than 30 million international travellers handled at Changi.

But Malaysia's Transport Minister Mr Chan said that the decision to maintain KLIA for both legacy and low-cost carriers would enable Malaysia to counter competition from its two immediate neighbours.

'This is a strategic measure to ensure that the Malaysian aviation industry continues to achieve rapid growth and the government's decision to develop as a regional hub is achieved,' he said.

But Mr Fernandes disagrees. 'We firmly believe that Subang is the right choice to maintain Malaysia's huge lead in the LCC market over Singapore.'

Copyright © 2004 Singapore Press Holdings Ltd. All rights reserved.

Kong Choy: Airasia To Set Up Joint Venture LCC In China
By Alan Ting

PUTRAJAYA, Feb 23 (Bernama) -- AirAsia, one of the largest low-cost carriers (LCCs) in Asia, is going to set up an LCC in China with local Chinese partners there, Transport Minister Datuk Seri Chan Kong Choy said Wednesday.

He confirmed that the Chinese aviation authorities had given AirAsia preliminary approval to fly to China from next month.

"They have started some negotiations, to what extent, I don't know," he told reporters after attending the Ministry of Transport Chinese New Year gathering here.

AirAsia had on Feb 7 issued a denial that it was planning joint ventures in China.

According to Ministry of Transport officials here, the LCC joint venture with the Chinese partner could be similar to AirAsia's joint-venture model between AirAsia and Shin Corporation, a company controlled by the family of the Thai Prime Minister Thaksin Shinawatra.

Shin Corp holds a 51 percent stake in Thai AirAsia while Air Asia holds the balance of 49 percent.

In January, China's Civil Aviation Authority (CAAC) announced that it would allow budget carriers to fly domestic routes, but these carriers would have to come from either China, Hong Kong or Macau.

Bernama understands that this policy stance has influenced AirAsia to consider a joint venture in China.

AirAsia is believed to be eyeing access to a number of Chinese cities such as Xiamen, Haikou, Guangzhou, Chengdu and Chongjing from Bangkok via Thai AirAsia.

If the joint venture in China materialises, AirAsia will be the first foreign airline and LCC to be given approval to operate in China, whose aviation market is seeing increasing passenger traffic in the last few years.

The transport ministry officials also revealed that the shareholding for the Chinese joint venture could not be finalised at the moment as there were some reservations by the Chinese authorities on the composition of the equity stake.

Bernama understands that the Chinese authorities want the Chinese partner to have more than 51 percent control for the proposed joint venture, which is likely to be named China AirAsia.

However, sources close to AirAsia said the main problem was not about shareholding but whether the joint venture would have enough aircraft to operate.

They said AirAsia was facing a shortage of aircraft at present to get operations up and running in China.

AirAsia currently has 24 aircraft and its fleet is expected to increase to 36 by the middle of this year.

AirAsia is targeting markets within 3.5 hours of flight time from its hubs in Sepang and Bangkok, covering a population of 500 million within South East Asia.

With AirAsia flying to China, it would eventually have access to a market with a population of 1.2 billion.

-- BERNAMA

AirAsia Bags Market Leadership Award


KUALA LUMPUR, March 8 (Bernama) -- AirAsia was recently awarded the Market Leadership Award at the 2005 Airline Achievement Awards by Air Transport World (ATW) Magazine.

In a statement Tuesday, the airline company said that it was joining other past winners such as Virgin Atlantic Airways (1998), Ryan Air (2000) and Jet Blue (2002).

AirAsia today has a fleet of 28 Boeing 737-300 and operates over 100 daily flights from its hub in Kuala Lumpur, Johor Baharu, Bangkok and Jakarta.

The airline recently increased its routes to include Thailand and Indonesia through strategic formation of Thai AirAsia (Thailand) and AWAIR (Indonesia). AirAsia has a 49 percent stake in both companies.

Its Thai operations is with telecommunication conglomerate Shin Corporation which made its maiden flight in February 2004 while PT AWAIR was relaunched as an Indonesian based low fare airline on Dec 8, 2004.

Its group chief executive officer, Tony Fernandes said that AirAsia's success of low cost travel had prompted many other low cost carriers in the region to enter the market.

The ATW airline industry awards recognizes excellence and achievements within the airline industry.

-- BERNAMA

AirAsia: Online sales have eclipsed offline sales





PETALING JAYA: About 55% of AirAsia Bhd's ticket sales is generated online and this is predicted to grow to 65% by year-end, said its regional director of information technology, Lau Kin Choy.

Lau told In.Tech that since the budget airline's “humble beginnings” in January, 2002, its online ticket sales have skyrocketed from 5% to a current 55% of total sales.

Tickets in Malaysia are also sold via AirAsia's 16 ticketing counters at various airports and city centres, through 13 select travel agents and via its callcentre at 1300-88-9933.

AirAsia launched its website (www.airasia.com) in April, 2002, and has invested less than RM1mil in it so far. The website is available in four different languages: English, Bahasa Malaysia, Chinese and Tamil.[/B]

“In Malaysia, over 150,000 seats are sold online per month. As a group, we sell about 500,000 seats per month,” Lau said.

[B]He estimates online ticket sales to be worth about RM30mil per month.

The group includes Thai AirAsia and AWAIR, an Indonesian private airline purchased by AirAsia and its Indonesian partners. Their websites include local language versions as well.

“Our cheapest seats and promotions will always be over the Internet,” said Lau, adding that AirAsia's cheapest seats available online can be up to 80% lower than the airline’s regular, published rates.

The company just concluded in mid-February a promotional campaign offering free seats to lucky surfers who logged on to its website.

A total of 50,000 free seats were up for grabs.

Some of AirAsia's fares are cheaper than airport taxes. Rates are lower when tickets are bought online, which was why most travellers preferred it to the offline method, said Lau.

Online ticketing eliminates administrative costs and cuts away the “middleman markup” that travel agents earn.

“Significant savings are recorded, which are eventually passed back to consumers,” Lau said, without giving any figures.

A Wall Street Journal Europe report in 2003 estimated that distribution or ticketing costs generally run to 15% to 17% of an airline's budget. This is an expense that can be significantly reduced by online ticket sales.

Reshaping consumer behaviour

According to the 11th Malaysia Internet User Survey conducted by AC Nielsen Consult last April, about 14% of online shoppers bought airline tickets. The other most popular online shopping activities were accommodations (10%) and books (8%).

The most popular website for online shoppers was AirAsia.com, with more than 30% of respondents having bought tickets there at one time or another.

The survey respondents were young (about 50% between the ages of 20 and 29), well-educated (nearly half had a bachelor’s degree or better), and had money to spend (about 40% had gross monthly household incomes of at least RM6,000).

AirAsia was not able to provide a profile of its own online customers.

There is no question that AirAsia believes in the potential of the Internet – why else would it use its planes as “flying billboards” for its website? – STEVEN PATRICK

AirAsia To Start Flights To Manila Next Month
March 21, 2005 18:59 PM






KUALA LUMPUR, March 21 (Bernama) -- Leading low-fare no- frills airline, AirAsia, is starting daily flight services to Manila in the Philippines from next month.

The new service will begin simultaneously from the Kuala Lumpur International Airport (KLIA) and Kota Kinabalu International Airport in Sabah from April 5.

AirAsia, in a statement Monday, said the flights would be to the Diosdado Macapagal International Airport (formerly Clark Angeles Airport) in Manila.

The airport is located 80 kilometres north of Manila and AirAsia said shuttle buses would be available to connect Clark and Manila.

AirAsia's group chief executive officer, Tony Fernandes, said the new service would provide more connections for the people of Philippines to visit Malaysia, and enhance the hub status of Kuala Lumpur and Kota Kinabalu.

"By connecting Clark to Malaysia, and linking it to our network of flights serving Thailand, Indonesia and Macau, AirAsia is indirectly bringing the people of Asean (Association of South East Asian Nation) closer and thus one step nearer to achieve a borderless Asean policy," he added.

The fares for the new destinations will start from RM129.99 for a one-way flight from Kuala Lumpur to Clark and RM119.99 for Kota Kinabalu to Clark. Seats will be available for sale from March 19 onwards, AirAsia said.

Seats can also be purchased via online at www.airasia.com or call AirAsia Nationwide Call Centre at 1-30088-9933 (within Malaysia) or 6-03-7884-9000 (outside Malaysia) for phone bookings.

-- BERNAMA

Business Times - 25 Mar 2005

AirAsia flying to 3 IndoChina destinations

(KUALA LUMPUR) AirAsia Bhd, South-east Asia's biggest discount carrier, said it will start flights to Laos, Cambodia and Vietnam, reiterating plans to buy 20 more planes from Airbus SAS in addition to the 80 ordered earlier.

The airline won landing rights to the three countries and will commence flights 'hopefully this year', group chief executive Tony Fernandes said at a briefing after meeting Malaysian investors and analysts in Kuala Lumpur yesterday.

AirAsia, which has placed firm orders for 40 aircraft and signed options for 40 more under a US$2.5 billion contract with Airbus in December, plans to expand its fleet.

AirAsia and its Singapore-based rivals like Tiger Airways, Valuair Ltd and Qantas Airways' Jetstar Asia are adding aircraft and destinations in South-east Asia. As many as 10 budget carriers are competing for passengers in the region, which had no budget airlines four years earlier.

On March 21, AirAsia said it will begin flights to the Philippines on April 5, becoming the second budget carrier to get landing rights after Tiger Airways.

Meanwhile, the Malaysian government has welcomed AirAsia's success in securing rights to fly to six destinations in China including Xiamen.

Transport Minister Chan Kong Choy told reporters, the government was very supportive of Malaysian companies wanting to excel and expand in international markets.

Mr Fernandes had announced earlier that AirAsia has secured approvals for six new destinations to China this year, including Xiamen. He declined to name the other five. - Bloomberg, Bernama

Copyright © 2005 Singapore Press Holdings Ltd. All rights reserved.

AirAsia signs up for 60 A320s, option for 40 more :)

AirAsia Bhd has signed a contract to acquire 60 A320s, with an option for another 40, representing an additional 20 aircraft on top of the original purchase agreement for 40 A320s plus 40 options under an earlier agreement.

In a statement on March 25, AirAsia said in making the order and option commitment, the airline had become the single largest customer for the aircraft in the Asia-Pacific region.

It said it decided to increase the Airbus order following the rollout and the success of its Indonesian operations, PT AWAIR International (AWAIR).

"Within three months of its operations, AWAIR has carried over 120,000 guests and introduced flights to five domestic destinations in Indonesia," said AirAsia.

AirAsia said deliveries of the first A320s would start in late 2005 and continue through until 2011. The A320s will completely replace the single aisle, 148 seat configuration Boeing 737-300s currently operated by the group in Malaysia, Thailand and Indonesia.

"AirAsia would operate a mixed fleet during the transition period," it said.

AirAsia gets KK-Darwin route offer
29 March 2005
Business Times

AUSTRALIA's Northern Territory is inviting Malaysia's low-cost carrier AirAsia Bhd to service the Kota Kinabalu-Darwin route.

Northern Territory's international trade director, Quentin Kilian, said his team would like to meet AirAsia's chief executive officer, Tony Fernandes, to extend the invitation.

Met on the sidelines of the International CEOs Conference yesterday he said the service is needed to meet demand of its travellers, especially businessmen.

"At present, there is no direct access between Kota Kinabalu and Darwin and this makes it difficult for our businessmen and the public to get to North Borneo, especially Sabah," Kilian said.

He said the Northern Territory has no preference as to which type of airline - full service or low-cost-carrier - it wants to service the sector. "First come, first served," he said.

He does not dismiss the possibility of discussing the idea with Malaysia Airlines, as Northern Territory prefers the flights to be operated by a Malaysian airline. He did not say why.

The proposed direct flights, he said, would be line with Northern Territory's rapid development process.

Meanwhile, when contacted, AirAsia executive director Kamarudin Meranun said the airline feels honoured by Kilian's offer.

However, he said it is crucial for the airline to study the feasibility of starting the Kota Kinabalu-Darwin service first. This is mainly to determine the market size and demand for the route, the operation cost involved and opportunities to fly to other potential destinations in Australia.

"AirAsia is always eager to fly to new destinations. Whether or not we will take up the offer will depend entirely on the findings of our study," he told Business Times in a telephone interview from Cambodia.

CEO: AirAsia up to the challenge
By VANITHA NADARAJ in XIAMEN

AIR routes to eight destinations in China and four Asean countries within six months may seem too much for a three-year-old airline to handle, but Tony Fernandes feels his AirAsia will rise up to the challenge.

The AirAsia group CEO was oozing with confidence when he told Malaysian reporters in Xiamen recently that his airline had the aircraft, manpower and resources and that it was not spreading itself thin. Only a year ago, he said AirAsia was not ready for China.

AirAsia will begin daily flights to Xiamen on April 25 through its Thai sister company, making it the first no-frills airline in Asia to enter China. It is making arrangements to fly, within the next six months, to seven other southern China destinations - Guangzhou, Naning, Kun-ming, Wuhan, Chengdu, Chongqing and Hankou.

“We were not ready at that time, but now the market is right, the (Xiamen) airport is right, Thai AirAsia is strong and Macau is good,” he said at a press conference here after a function to announce the airline’s entry into China, attended by over 80 reporters from China, Thailand, Indonesia and Malaysia.

Macau was added as a destination in the middle of last year and it has proven to be a lucrative move.

There will be more destinations added to its list by September when flights commence to Laos, Vietnam, Cambodia and the Philippines.

AirAsia currently operates over 100 point-to-point domestic and international flights from KL International Airport, Senai Airport, Bangkok International Airport and Soekarno Hatta International Airport in Jakarta.

Despite new destinations being introduced at such a break-neck speed, Fernandes is optimistic that his airline is capable of meeting market demands.

From a two-aircraft company, AirAsia is now in possession of 28, with 40 Airbuses expected from December onwards, making it the leading low-cost carrier in South-East Asia, with a market capitalisation of more than RM4bil - all within three years. It plans to raise orders for Airbus aircraft to 60, with an option for another 40.

Fernandes said that with the introduction of the new routes, the low-cost carrier might have to review its eight million-passenger target for this year. Over the last three years, AirAsia had about nine million passengers using its services.

Last year, AirAsia, the first low-fare and ticketless airline in Asia, formed successful joint ventures in Thailand and Indonesia where AirAsia holds 49% stake in both companies.

Thai AirAsia, a joint venture with Thailand’s largest telecommunication conglomerate Shin Corp, took off in February last year and has to date carried over one million passengers. PT Awair, re-launched as a low-fare airline in December, presently serves five domestic destinations in Indonesia.

Fernandes said: “Coming to China is a huge step. Another major step will be India – but not right now.”
Or so he says.

AirAsia and Australia ready to discuss Kota Kinabalu-Darwin flights


AirAsia and Australia’s Northern Territory officials are willing to hold talks on flights between Sabah and Darwin.

“We never turn down any offer. We are keeping an open mind,” AirAsia executive director Kamarudin Meranun told Agence France-Presse.

Kamarudin said the route between Sabah capital Kota Kinabalu and Darwin in the Northern Territory is within the three-hour time horizon of the carrier.

Meanwhile, Northern Territory International Trade Director Quentin Kilian told AFP such a link would promote tourism and trade and help make state capital Darwin a departure point for Australian tourists.

“We’re certainly interested in discussing it ...everything hinges on it being a commercial reality,” Kilian said.

“The opportunity is very much there,” he added.

Northern Territory officials were in talks with a number of airlines about expanding Darwin’s currently limited international reach of direct flights to Singapore, Denpasar in Bali and Brunei only, he added.

“What we want to do is open up both trade and tourism links within the near region,” he said, adding that this could include Malaysia and Brunei.

Kamarudin said AirAsia’s Indonesian unit, PTAWAIR International (AWAIR), was also keen to launch flights from Bali to Darwin.

“We can also do the Bali-Darwin route,” he said, adding that AirAsia would have to conduct a feasibility study before making a decision.

AirAsia operates in Malaysia, Thailand, Indonesia, the Philippines and Macau and will become the first no-frills foreign airline to fly to China next month with daily services between Bangkok and Xiamen in south-eastern China. – AFX-Asia

Chang Picked To Head AirAsia's Operations In China And North Asia
April 04, 2005 16:35 PM




KUALA LUMPUR, April 4 (Bernama) -- AirAsia announced the appointment of Jean Chang as its new executive vice president for Greater China and North Asia to head AirAsia's operations in both regions.

In a statement here Monday, the company said that Chang would be part of the new regional set up based in Kuala Lumpur.

He has an in depth knowledge of the airline and aviation related industry both in and outside China.

He also has over 20 years of experience in the aircraft sale and leasing, airport privatization and master planning, aviation portfolio investment and management.

"With his vast experience and connections within the Chinese aviation industry, I'm confident Chang would be a valuable addition to the Air Asia Group in furthering the group's interest in China and beyond," said the group's chief executive officer AirAsia Bhd, Tony Fernandes.

-- BERNAMA

AirAsia Offers Cheap Fares To The Philippines
From Farazira Amira Yusof

CLARK, (Philippines) April 5 (Bernama) -- Malaysian budget carrier, AirAsia Bhd is the first ever low fare airline in Asia to land in the former United States military base in the Philippines Tuesday.

Its first flight AK 32 touched down at Diosdado Macapagal International Airport in Clark this morning with 123 passengers on board which included businessmen from Malaysia, tourists from United Kingdom, Australia and the Philippines.

AirAsia's other flight AK 502 from Kota Kinabalu, Sabah with 102 passengers on board also landed in Clark later Tuesday.

Besides AirAsia, Singapore-based low cost carrier, Tiger Airways had also made its maiden trip to Clark, Tuesday.

"We are proud to be here. Our presence in the Philippines is testimony to our commitment to strive for a tighter and closer Asean community while promoting the exchange or rich cultures, heritage, skills and friendship," its group chief executive officer, Tony Fernandes said at a media conference, here Tuesday.

He said that the company's presence in the country would help boost the tourism industry in both Malaysia and the Philippines.

Clark, located between Manila and Subic Bay is in close proximity to Mount Pinatubo - a volcanic mountain which erupted some years ago and buried its surrounding areas with mud and lava flow.

Clark Development Corporation's president and chief executive officer, Antonio R. Ng said AirAsia's entry into Clark would be a realization of the corporation's commitment to promote intra-Asean region.

He said that AirAsia had revolutionized the air travel industry to allow a great number of people to fly at low and affordable fares.

Starting today, AirAsia would commence 14 times a week service between Kuala Lumpur-Clark, Kota Kinabalu-Clark and vice versa.

It's a one-way ticket to Clark from Kuala Lumpur will cost about Peso 1,949 (RM99.99) and from Kota Kinabalu, Peso 1,799 (RM69.99).

AirAsia will use two aircraft for its daily flights to Clark. The 148-seater Boeing 737 will leave Kuala Lumpur at 7.20 am and arrive in Clark at 11.15am while the same aircraft will leave for Kota Kinabalu at 11.40am.

The 2.05pm flight from Kota Kinabalu will arrive in Clark at 4.05 pm, when it will again pick up passengers bound for Kuala Lumpur.

Tony said AirAsia was also looking to fly directly to Davao, Cebu and Zamboanga from Kuala Lumpur and Kota Kinabalu.

AirAsia, a subsidiary of Tune Air Sdn Bhd, currently operates with just two Boeing 737-300s with its centres at the Kuala Lumpur International Airport and Senai Airport in Malaysia, Bangkok International Airport in Thailand and Soekarno-Hatta International Airport in Indonesia.

-- BERNAMA

so I wonder how far Clark is from Manila?

Just like to share with you guys some experience I have with the booking of AirAsia ticket.

Well... I really like to warn those who are taking AirAsia wherever you go.... DOUBLE CONFIRM your booking with AirAsia (preferably PHONE them) before you depart a week before and few days before...

This is my experience which is also my friend's.

Last Chinese New Year, I booked my ticket like few months before... in advance... All the bookings were successful and I did have my confirmation email as well as booking number. So did my friend, he made his booking too.

But, a month later, my friend received a call from a friend from his hometown saying that the flight has been canceled. My friend was so puzzled that he called up AirAsia and mysteriously they told him that the flight has actually been canceled. But, no one from AirAsia actually called and informed my friend about this.

So, I thought this might not be happening to me since JB-PEN flight has always been a hot item. I did call them.

One fine day, a month before Chinese New Year, I called up AirAsia to confirm my flight and so surprisingly that they told me the flight has been canceled and asked me to take a transfer flight from KLIA. But, I did not make my decision because I need to think about it. Then I called back like 30 minutes later, another guy told me that the flight has confirmed and there's no way they will cancel it especially during this festive season. Again, I was totally lost. Then, I called again to double check. Well, this time the lady told me THEY MAY OR MAY NOT BE CANCELING THE FLIGHT. So, I was so angry with that and actually asked them to transfer me to a SURELY CONFIRMED flight. So, I had no choice but to take earlier flight which was Friday.

Well, I just want to share my experience and my friend's with you guys so that you guys can take precautions and rememer to DOUBLE DOUBLE DOUBLE check your flight before you depart...

AirAsia may resume JB-Bangkok flights
Rizalman Hammim

AIRASIA Bhd, Southeast Asia's biggest discount carrier, may resume its Johor Baru to Bangkok service by end of the current quarter, said Datuk Mohd Sidik Shaikh Osman, a director of Senai Air Terminal Services Sdn Bhd (SATS).

“They suspended the service in December because of shortage of aircraft. They told us they planned to resume the service in June when they receive new aircraft,” Sidik told Mail Money in a telephone interview.

Prior to the suspension, AirAsia had a daily service operating from Senai Airport to Bangkok.

On Feb 21, AirAsia said it may miss its profit forecast for the year ending June 2005 because of delays in plane delivery.

Since that announcement, AirAsia shares have fallen 11.76 per cent to RM1.50, while during the same period, the benchmark Kuala Lumpur Composite Index had shed 4.75 per cent.

Mohd Sidik said that the other flights being operated by AirAsia from Senai hasn’t been distrupted.

“They are still on going, its just the international flight,” he said.

The Bangkok to Senai service is the only international flight which AirAsia operates from the Senai Airport.

The Senai Airport, which is controlled by Tan Sri Syed Mokhtar Al Bukhary’s SATS, is the only commercial airport in the country, which is operated and managed by a private entity.

The other airports in the country, including the Kuala Lumpur International Airport, are operated and managed by the Government majority-owned Malaysia Airport Holdings Bhd.

Maiden quarterly profit for Thai AirAsia


BANGKOK: Thai AirAsia Co, a joint venture between Thailand’s Shin Corp and AirAsia Bhd, said it made its first quarterly profit in the three months ended March on rising travel demand and by buying its fuel requirements forward.

The airline filled 80% of its seats with paying passengers in its domestic routes and 70% in its international routes in the March quarter, chief executive Tassapon Bijleveld said in Bangkok, without giving details.

“Buying fuel forward helped us manage our costs,” said Tassapon.

The company bought its fuel requirements for the year in advance and plans to levy 100 baht a ticket as fuel surcharge, he said.

Thai AirAsia, which competes with nine budget carriers in the region amid rising travel demand and high oil prices, had a loss of 30.1 million baht (US$760,000) in the three months ended Dec 31, compared with a third-quarter loss of 73.2 million baht.

In 2004, the airline posted a loss of 240 million baht and made 1.45 billion baht in sales.

The price of jet fuel, which typically makes up between 15% and 40% of an airline’s operating costs, surged 58% to a record US$76.38 a barrel on April 4 in Singapore, based on Platts pricing service. The fuel was traded at US$74.41 a barrel on April 6.

Thai AirAsia started flying in February last year from its base in Bangkok.

It plans to start flights to China this month and seeks to expand overseas, including to Vietnam. – Bloomberg

Overcoming the fuel blues

BY JOSE BARROCK AND HARI RAJ


STUBBORNLY high jet fuel prices are exerting immense pressure on the global airline industry – an industry where profits generally seem elusive. Traditional as well as low cost carriers are now faced with the unenviable task of keeping a lid on cost to continue to remain profitable. Against this backdrop, the pressure to raise fares has become irresistible.

For Malaysia’s low cost carrier (LCC) AirAsia Bhd, the challenge is no different. In fact, LCCs, say observers, face an even bigger challenge to keep cost down as their business model thrives largely on a single factor – low cost. The poser is: “How much more can they slash cost without passing it on to consumers?”

Quite a lot more, according to AirAsia chief executive officer Tony Fernandes. “There are hundreds of ways to cut corners. We have a whole lot of people religiously working to keep costs low.”

That, in a nutshell pretty much encapsulates AirAsia’s success, which has been chronicled countless of times, in business sheets in Malaysia as well as all over the world.

The fact is escalating fuel bills proved to be a bane to AirAsia as it was vigorously planning to list in October last year. It continues to remain investors’ biggest beef today. Year to date, jet fuel prices have risen by 43% in tandem with rising crude oil prices.

Analysts contend that fuel costs comprise a larger portion of LCCs’ costs compared to their full-service rivals as other costs, which include staff costs, landing charges and administrative expenses are much lower. As such, an analyst says earnings of LCCs may be more sensitive to movements in fuel prices, albeit dependent on their respective fuel hedging strategies.

On the back of this, Fernandes says AirAsia has so far, modestly raised ticket prices. In addition, he says the company has been given the nod to add fuel surcharges to its fares. This would appear to be inevitable given that fuel constitutes just over 30% of the group’s operating cost.

“There is price elasticity. We can pass on fuel costs to passengers. Once the market becomes more mature, we have the ability to increase prices. So, it’s not like we are stuck with high oil prices,” he says in an interview.

Analysts’ biggest worry is that while AirAsia has undertaken substantial cost cutting measures, the rising fuel price may mask the significant progress on this front.

Still, a fair number of airline analysts are not in a hurry to paint a bleak picture for this low-cost carrier. “Most analysts first looked at AirAsia in 2001 (when it first started) and wondered if these bunch of guys from the entertainment and music industry could do it. Right from the start, AirAsia has consistently proven everyone wrong. They have a great business model and they have first mover advantage. So, they may just stem this tide,” says one analyst.


The first mover advantage according to Fernandes is much like an ace up AirAsia’s sleeve. “We had a head start. When we started the airline, jet fuel was at US$25, aircraft prices were low and so were pilot costs. Now, however, anyone starting a similar business has to compete with us first, and we are already a well-capitalised entity. They are starting now when jet fuel price is about US$70 and the cost of aircraft has almost tripled.

“Because we have the first mover advantage, we used the period of low prices to build the business. Now we have critical mass and the upper hand. We have 30 planes and have placed an order for 100 airbuses. We are growing aggressively,” he says.



A THRIVING SECTOR



That put aside, the sheer potential of growth in Asia for LCCs seems enormous. One factor supporting that prognosis is that LCC activity in the region is still on growth mode, having only begun not so long ago.

The model has garnered an intense following, which has resulted in a mushrooming of LCCs in Southeast Asia, with the numbers expected to increase further. The sweet spot for the industry is that the region is fast becoming, if not already, one of the world’s largest tourism hubs.

But, like all growth industries, competition is getting hot. Singaporean Tiger Airways and JetStar Asia, Thailand’s Nok Air and One-Two-Go, and Philippines-based Cebu Air, are all players in the new game. It would appear that AirAsia sits on the perch of the industry as the largest LCC in the region.

The road to where it stands today however was bumpy and short. It started out in late 2001 with two aircraft, losses, and debts of RM40mil. By merely replicating what had already existed in other parts of the world in Malaysia and Asia and through sheer force of marketing, Fernandes has become a poster boy for wannabe entrepreneurs. Today, after having set off what some refer to as a “low cost revolution” in domestic air travel, AirAsia commands about a 30% share of the market.

Fernandes’ biggest challenge at that point, and to a certain extent now as well, was to fend off naysayers. And this is a story he often narrates. “Since we started, we have never heard anyone say “AirAsia’s going to work.” There hasn’t been a believer since day one. They said that AirAsia and the LCC model wouldn’t work. Then, they said it would only work in Subang. Next, they said it will only work as a domestic carrier. But we have proven the sceptics wrong on all counts so far,”

“We’ve been through a lot since we started operations in 2001 – SARS, jet fuel spikes, tsunami, bird flu, war, terrorism, even earthquakes ...” he says.



PROFIT FORECASTS



Going forward however, analysts are closely watching to see if AirAsia will be able to meet its profit projection of RM160mil for the financial year (FY) ending June 2005.

“We' re not sure yet if we’ll miss the target. Our guidance is still from the second quarter. Our third quarter will give you a stronger indication of whether we can meet the target. (However) if we don’t make it, its due to capacity,” he adds. (The company is expected to make a statement on the profit forecast on May 25 when it reports its third quarter results)

For the first half of FY05, AirAsia made profits of RM54.8mil on the back of RM302.8mil sales. Most analysts opine that AirAsia is likely to miss its profit target on the back of rising oil prices and more significantly, due to its inability to meet rising demand due to lack of aircraft.

In its notes accompanying its 2Q results, AirAsia says: “While the company continues to trade positively with unit costs decreasing, it is likely that the results for the remaining period of the financial year will be impacted by delays in acquiring sufficient aircraft on a timely basis to meet its expansion programme. Another factor that may influence prospects in the current financial year is the continuing high level of fuel prices.”

Fernandes elaborates: “We (AirAsia) don’t want to make short-term decisions just to hit a profit target, and then take the next five years to recover. We take a different view on targets. We are short of planes at present. I’m not going to just go out and buy six expensive planes just to hit a target.

“In the event that we don’t (hit the target), we’ll be honest with the investors. But you must understand we’re only delaying our profits. Its not that there is something structurally wrong with the business – our costs are low, load factors high and we are growing very well. Ultimately, we hope to look after shareholders’ interests for the long term, not just for one year.”

An analyst from a foreign house has forecast that AirAsia will make net profits of RM130mil. But he puts things in perspective: “The question is not whether AirAsia will meet its profit forecasts or not, but by how much will it miss.”

Another analyst from a local broking house adds that the issue with AirAsia may be one of hype that has caused a great divide between reality and perception. While that has worked only too well in terms of branding, the analyst says, it could haunt the company in hard times. “Too much expectation was built up. So, the smallest hiccup would be made to seem like a huge weakness ... But it may not seem realistic,” she adds.



WHERE IT STANDS



AirAsia continues to pursue its expansion plans. The company recently made an order with aircraft maker Airbus SAS for as many as 60 new A320-200 planes, with an option to acquire 40 more. This makes AirAsia’s the single largest order to date made by a company in the Asia-Pacific region.

Aggressive geographical expansions have also been made over the last few months, giving AirAsia inroads into several large markets.

In both Thailand and Indonesia, AirAsia has joint-venture agreements with local companies on a 49:51 basis with the local parties having the larger shareholding, but with AirAsia having management control of the JV company. ThaiAirAsia Co just posted its maiden quarterly profit while its Indonesian venture PT AWAir is expected to boost AirAsia’s earnings in the near future.

Other markets include China, Macau, and the Philippines. Plans are also under way to venture into the Indo-Chinese market via Vietnam and Laos, and the huge Indian market.

In the near future, AirAsia is looking at strengthening its position in the China after its maiden foray in Xiamen late last month. In the pipeline are flights to Guangzhou, Shenzhen, Kunming, Chongqing, Guilin, Nanning and Wuhan.

Interest has also been expressed by companies from as far as Mexico, and Darwin in Australia, to tie up with AirAsia to set up LCCs.

China, without a doubt, excites Fernandes. “I think everyone has big plans in China. No one can ignore a country with one billion population. We are very excited about China, but we are in no super rush to get into the China market. We have sown the seeds for some very interesting prospects in China. We have to make sure we get it right,” he says.



LCC HUB



A boost to AirAsia has been the Government’s move to set up a LCC hub in KL International Airport at a cost of some RM140mil. The terminal will be ready by the early part of next year and cater to as many as 10 million passengers annually with some 40 parking bays for aircraft.

The new LCC terminal augurs well for AirAsia as it will reduce costs.

“We are heavily involved in the designing of the terminal and we hope it will be ready by January or February. It will be large, with space for some 40 aircraft to park. The LCC terminal will improve our costs tremendously,” Fernandes says.

AirAsia will be the anchor of the new LCC terminal but other budget airlines will be allowed to use the facilities as well. The move to create the LCC terminal is part of the aspiration of the Government to make Malaysia a low cost carrier hub.

“We have created an industry that wasn’t there. Who were we and what capital did we have? We have gone up against so many people and we are still standing. We got the Government to build us our own terminal after three years. And we have created a lot of jobs as well.

“From where we were and where we stand now, no one can take that away from us,” says Fernandes.

AirAsia in talks to raise US$3.6bil


AIRASIA Bhd is in talks with Citigroup Inc, HSBC Holdings Plc and other lenders to negotiate a US$3.6bil (RM13.7bil) loan to finance the planned purchase of 60 new aircraft.

AirAsia wants to buy rather than lease the Airbus SAS A320 planes and pay for them with loans instead of money raised in an initial share offer last year because it is generating enough cash from operations to pay the debt, chief executive officer Tony Fernandes said in an interview recently.

Other lenders in talks with AirAsia include France's Calyon and Deutsche Bank AG.

The airline, which currently operates 24 Boeing Co. 737-300s, wants to expand its fleet to meet travel demand in South-East Asia, where there are 500 million people within three hours' flying time of its Kuala Lumpur base.

AirAsia is also betting increased flight frequencies and more destinations would help the company meet its own profit forecasts.


Tony Fernandes
“We're in that situation where we're not short of people wanting to lend us money,'' Fernandes said. AirAsia will have European credit agency guarantees, a type of sovereign bank guarantee, he added.

The three agencies that provide guarantees for Airbus plane orders are Britain's Export Credits Guarantee Department, Coface of France and Germany's Hermes Kreditversicherung AG.

Government-owned export credit agencies guarantee the creditworthiness of borrowers or provide funding to help exporters sell products, including computer-chip manufacturing equipment, trains and aircraft, to developing countries.

Loans to the three-year-old airline shouldn't be a risk to banks, analysts said.

“There probably aren’t too many issues on the creditworthiness of AirAsia as I presume the loans are significantly backed by the value of the aircraft,'' said Peter Hilton, head of transport research at Credit Suisse First Boston in Hong Kong.

“The bulk of the planes provide the security, and I suspect the banks are in good shape in terms of having collateral.”

Toulouse, France-based Airbus, the world's largest maker of commercial aircraft, said in March it won an order for the 60 planes, under a contract valued at catalogue prices at US$3.8bil. The order was 20 more than Airbus had indicated in December AirAsia had planned to buy.

It's cheaper for AirAsia to buy the planes than lease them, Fernandes said, without elaborating.

AirAsia's “aggressive expansion plan” needs financing and it's too early for the carrier to issue more equity, said Teng Chee Wai of Hwang-DBS Asset Management in Kuala Lumpur.

AirAsia forecast in the prospectus for its RM863milshare sale last year that it would earn RM147.4mil in the year ending June 30.

Too few aircraft may cause the airline to miss that profit forecast, Hilton said.

AirAsia is scheduled to start taking delivery of the A320s in December at a rate of one a month, Fernandes said. – Bloomberg

Business Times - 11 May 2005

AirAsia flies to Sibu from May 24

SENAI - AirAsia, the no frills airline in Southeast Asia, announced that it would commence direct flights between Johor Bahru and Sibu, in Sarawak beginning May 24, 2005.

The new Johor Bahru-Sibu service would be operated three times a week on every Tuesday, Thursday and Saturday.

A one way trip starts from RM49.99 (US$13.15).

Copyright © 2005 Singapore Press Holdings Ltd. All rights reserved.

AirAsia To Impose Fuel Surcharge


PUTRAJAYA, May 11 (Bernama) -- AirAsia, one of the largest low-cost carriers (LCCs) in Asia has notified the government last month of its plans to impose fuel surcharge on all its flights including domestic and regional routes, Transport Minister Datuk Seri Chan Kong Choy said.

"As a private airline they do not need to seek government's approval, but they informed the government (the Ministry of Transport) that they are going to impose a surcharge for flights across the region and the domestic sector," Chan told reporters during his ministry's post-cabinet meeting here Wednesday.

As to when AirAsia was going to impose the surcharge, he said that it would "be their business decision.'

When asked on the quantum of the surcharge, he said it would be less than 10 percent.

He said as AirAsia was a private company, it had the right to impose the surcharge, unlike the national carrier, Malaysia Airlines, where the government was the biggest stakeholder.

Responding to a question on whether the surcharge was reasonable, Chan said: "This would depend on the customer, if the customers find it too high, they can move to another airline.

"But at the moment, there are no airlines that can run aways from this sucharge situation, as no airline has been spared by this fuel price (hike)."

On another note, he said if the oil price continued to increase, the government would consider (proposal) from Malaysia Airlines' to increase its regional and international routes according to the fuel price.

He said the government had recently granted permission for the national carrier to increase the surcharge on its domestic routes which took effect on May 1.

Chan stressed that the government would not allow anymore increase in the fuel surcharge to Malaysia Airlines for its domestic routes.

However, he said the airlines had also agreed that they would not seek for further surcharge on the domestic routes.

Malaysia Airlines increased its fuel surcharge for long haul international flights from RM50 (US$13.15) to RM76 (US$20), while that of regional flights from RM15 (US$3.95) to RM38 (US$10) starting May 1. On the domestic sector, the flights between Peninsular Malaysia and Sabah or Sarawak, the charge imposed was RM15 (US$3.95), and flights within the peninsular and the states, went up RM7.50 (US$1.97).

The request by Malaysia Airlines and Penerbangan Malaysia Bhd regarding the changes was agreed upon by the Cabinet last month due to the increase in fuel prices.

-- BERNAMA

WELCOME… Four AirAsia stewardess (from right) Farlinah Jaharie, 24, Anita Adnan, 29, Francisca Ng, 24 and Intan Suhaila Zulkifli, 29, also present at the groundbreaking ceremony for the (LCC) Terminal at the Kuala Lumpur International Airport, in Sepang, Monday. Pix: Noriani Ahmad

http://foto.bernama.com/foto/Photo/060605_4.jpg

At KL sentral railway station

http://img128.echo.cx/img128/9756/198143973ddpqffph112uy.jpg

M'sia's Mega Sale Promo Kicks Off To A Flying Start
June 06, 2005 19:43 PM
By Mohd Nasir Yusoff


JAKARTA, June 6 (Bernama) --Malaysia's Mega Sale promotion kicked off to a flying start in Indonesia with thousands of Surabaya residents flocking to its official launch to grab the special offers on travel, education and medical check-up packages at the Pakuwon Super Mall, Sunday.

And, that made team leader Malaysian Deputy Tourism Minister Datuk Zahid Hamidi, a very happy man in that second largest city of this island republic.

"We invited about 200 travel agents, tour operators and local tourism officials to the launching but thousands of visitors to the Mall swarmed the function as yesterday was Sunday," he told Bernama over the telephone from Surabaya Monday.

He said every visitor he met and talked to, were happy and glad that Tourism Malaysia had chosen Surabaya as the first destination for the nationwide launch as the move enabled them to be the first to grab the offers.

Already 70 per cent of seats on direct Malaysia Airlines (MAS) and Air Asia flights for the Surabaya-Kuala Lumpur route had been taken up for the Mega Sale period from July 23 to Sept 4 and that was also enough reason for the local travel and tour operators to be happy about.

Among companies taking part in the two-day promotion in Surabaya are two hotels and resorts, two private colleges, nine private specialist medical centres, two travel agents and several state governments apart from Tourism Malaysia itself.

"Visitors too were thrilled by Reka Batik Malaysian batik promotion with six models taking the stage and the Malaysian cultural show, many visitors also appreciated their uniqueness," he said, also thanking Indonesian Indosiar television station who was the main sponsor for the Malaysian Mega Sale promotion in Surabaya.

Apart from the confirmed bookings, Zahid said, all the participating booths also received a lot of enquiries from potential tourists to Malaysia, which proved that with more such efforts throughout the year, Malaysia could easily tap the huge Surabaya market as the city was home to a large number of middle and high income earners. "Thanks also to MAS and Air Asia for servicing the direct Surabaya-Kuala Lumpur route as this direct link would certainly boost Malaysia's tourism, and like wise help increase this city tourism activities too," he said.

After Surabaya, Zahid will be leading Malaysia's Mega Sale promotion to Jakarta for two days from Tuesday and off to Bandung (June 9 and 10) and to Jogjakarta (June 11, 12 and 13).

-- BERNAMA

AIRASIA SIGNS 750 MLN USD DEAL WITH CFM INTL FOR AIRCRAFT ENGINES
Updated : 13-06-2005
Media : AFX
Story By : Wing Siong Hoo



(XFN-ASIA) - AirAsia Bhd said it has signed an agreement with CFM International Inc for a firm order of 120 CFM 56-5B6/P engines and 9 spare engines, as well as the right to purchase an additional 80 engines and 6 spare engines, for a total of 750 mln usd.

The engines are to be installed on the airline's Airbus A320-200 fleet and will also be used as spares.

In a statement, AirAsia said the funding for the purchase will form part of the funding required for the Airbus aircraft acquisition.

"The company is currently considering various sources of funding, including but not limited to export credit guaranteed borrowings, commercial bank borrowings and sale and leaseback transactions," it said.

It added that Airbus A320-200 aircraft complete with the installed engines are scheduled to be delivered over a period of up to six years, with the first two aircraft scheduled for delivery in December this year.

Malaysia AirAsia Pays US$750M For Aircraft Engines
Updated : 13-06-2005
Media : Dow Jones
Story By : N/A



(Dow Jones)--Malaysian budget carrier AirAsia Bhd. (5099.KU) Monday said it will buy the CFM 56-5B6/P engine for its Airbus A320-200 fleet.

On March 25, AirAsia said it had signed a firm order with Airbus to buy 60 Airbus A320-200 aircraft and also the rights to buy a further 40 of the same aircraft.

Monday, AirAsia said it will buy 120 engines and nine spare ones for US$750 million for the company's firm order for 60 aircraft.

AirAsia also signed an agreement for the rights to buy an additional 80 engines and six spares for a further 40 aircraft.

The engines are manufactured by CFM International, Inc., a company that is controlled by two major aircraft engine manufacturers - Snecma Moteurs of France and General Electric Co. in the U.S.

"The Airbus A320-200 aircraft, complete with the installed engines, are scheduled to be delivered over a period of up to six years with the first two aircraft scheduled for delivery in December 2005," AirAsia said in a statement to the local stock exchange.

Further, AirAsia said it is considering various sources of funding, "including but not limited to export credit guaranteed borrowings, commercial bank borrowings and sale and leaseback transactions." It didn't elaborate.

On May 9, AirAsia reportedly said it is in talks with five international lenders to finance its MYR14.4 billion purchase of 60 new Airbus A320 aircraft.

AirAsia, Astro, Bursa Added to Malaysia's Benchmark Stock Index
Updated : 14-06-2005
Media : Bloomberg
Story By : Stephanie Phang



(Bloomberg) -- Astro All Asia Networks Plc, AirAsia Bhd. and four other companies will be added to the Malaysian exchange's key stock index on June 30, Bursa Malaysia Bhd. said.

Bursa Malaysia, which owns the stock exchange, KLCC Property Holdings Bhd., Scomi Group Bhd. and Uchi Technologids Bhd. will also be added to the Kuala Lumpur Composite Index, Bursa Malaysia said in a press release today.

The index will be altered to ``reflect the changes in the national economy as well as evolvement of the corporate sector,'' Bursa Malaysia said. The new stocks were selected based on their market capitalization, business activities and trading volume.

The Composite Index is made up of 100 stocks including Malaysia's largest companies by market value, with a combined market capitalization of 447 billion ringgit ($118 billion). The index has declined 1.6 percent this year.

The new inclusions will replace Mesiniaga Bhd., Computer Systems Advisers (M) Bhd., Manulife Insurance (M) Bhd., United Plantations Bhd., Hap Seng Consolidated Bhd. and Measat Global Bhd. on the index, the exchange said. The companies are among the least actively traded on the index, it said.

Separately, Bursa Malaysia said it will stop adjusting the index for dividend payments starting July 1. The index is currently adjusted for dividends of 50 sen and above.

``The KLCI is a price index, not a total returns index,'' Head of Information Services Raghbir Singh Bhart was cited as saying in a press statement. Major stock indexes including the FTSE aren't adjusted for dividends, he said.

MAS may pass bulk of local flights to AirAsia
Updated : 18-06-2005
Media : Business Times
Story By : ANNA MARIA SAMSUDIN



NATIONAL carrier Malaysian Airline System Bhd (MAS) may hand over a big chunk of its domestic flights to budget airline AirAsia Bhd under a plan that could help the Government reduce its financial burden.

The Government now absorbs the costs of MAS¡¦ local services through Penerbangan Malaysia Bhd (PMB), a government-owned company.

MAS made operational losses of some RM281 million for domestic flights in fiscal 2005, an almost 80 per cent increase from RM156.7 million it lost a year earlier.

According to sources close to the deal, MAS would probably concentrate on Malaysia¡¦s major cities, namely Penang, Langkawi, Kuching and Kota Kinabalu, while AirAsia will service less profitable routes in the country.

This is likely to be announced by the end of the month.

AirAsia chief executive Tony Fernandes, when contacted, said the proposal is a good idea as it benefits Malaysia Airlines by allowing it to allocate its resources to the proper channels.

¡§Consumers will benefit from the ability to get services at a cheaper rate for domestic routes previously controlled by MAS, and having more choices in terms of cheaper fares,¡¨ he said.

However, Tony added that AirAsia will later introduce an appropriate pricing formula for its domestic routes.

PMB, when contacted, declined to comment.

However, the Government may continue to subsidise loss-making destinations as a social obligation, said OSK Research senior analyst Chris Eng.

¡§It is better for MAS to concentrate on major cities not only because of the demand but because these points serve as feeders to the airline¡¦s international service,¡¨ another analyst said.

Earlier reports had speculated that MAS would drop rural services in Sabah and Sarawak which are currently served using old Twin Otter and Fokker 50 aircraft.

MAS had said that these services had a 110 per cent break-even point, meaning that it is impossible to operate profitably unless fares are raised significantly and airplanes are replaced.

MAS may also focus on the premium market in order to avoid overlapping roles with AirAsia. This means that MAS would focus on travellers who are willing to pay more for comfort.

¡§MAS should seriously take note that not everyone wants to fly with AirAsia and there are people, namely the Tan Sris and Datuks who simply cannot do without the frills offered by full service airlines.

¡§From the way I see it, MAS strategy now is to position themselves as a premium brand,¡¨ he added.

OSK¡¦s Eng said this arrangement would have a more positive impact on AirAsia¡¦s overall earnings.

Without competition from MAS, the budget airline could increase flight frequencies, which translates into higher revenues.

¡§It will not make any difference to MAS actually because all it is doing is just running the domestic operations for Government owned special purpose vehicle PMB,¡¨ he told Business Times.

Asked about air services to the rural areas, Eng said it would be unlikely that the Government would pass the burden to AirAsia, which does not have suitable planes to fly there.

AirAsia to gain from route revamp?
Updated : 18-06-2005
Media : The Star
Story By : JOSE BARROCK



REPORTS of a possible restructuring of domestic airline services have flooded the local business pages over the past week, suggesting that a concept paper is being put together to revamp the domestic airline industry.

The biggest beneficiary of such a revamp is likely to be budget liner AirAsia Bhd. CEO Tony Fernandes was quick to respond, stating that the move by the Government should be lauded, and that AirAsia is willing to fly any route which is currently being plied locally by Boeing 737 or Fokker 50 aircraft.

Government investment arm Khazanah Nasional Bhd, Penerbangan Malaysia Bhd which controls as much as 69% of national carrier Malaysia Airlines (MAS), and the finance and transport ministries are looking at several possibilities.

Market observers are, however, unexcited by the prospect of AirAsia being given new routes to operate. 'It was bound to happen sooner or later, so it's not a big deal. MAS is making losses on domestic routes, so PMB as the parent is expected to take a stand. AirAsia, meanwhile, is looking to increase its domestic routes ... So it only makes sense for MAS to give up some routes to AirAsia. I’m just surprised it wasn’t done earlier,' she says.

The added flights, analysts say, should have a positive impact on AirAsia's bottom line. But since details of what routes will be taken over by AirAsia are still scarce, an accurate picture cannot be painted as yet.

An analyst from Mayban Securities says: “It's good news for AirAsia. It is definitely positive for AirAsia, but quite difficult to quantify as AirAsia has ordered many new planes, so it's still not clear how they will fill up the new planes or how cost efficient the move will turn out to be. It's also left to be seen how the Government will play its cards and divide the routes.'

For the nine months ended March this year, AirAsia posted a net profit of RM95.5mil on the back of RM466.7mil in sales. Reuters Estimates, polling some 11 brokers, forecasts AirAsia raking in as much as RM134mil in net profit from RM1.1bil in revenue for the financial year ending June this year.

Another analyst from a local brokerage, however, is not optimistic that AirAsia is going to benefit from the new routes, which may be handed over by MAS, as it is likely that the routes may constitute those that are not commercially viable.

“AirAsia's growth all along has been commercially driven. If there is demand for a certain route, it will increase flight frequency. It has always grown at its own pace ... This has been its modus operandi from day one. If it is given routes which are commercially not viable, it is likely to have only a few flights to these destinations,' he says.

He adds that to date, AirAsia has been successful in getting new routes and expanding at a rapid pace. As such, he points out that the additional routes may not have a very significant impact on their bottom line.

The analyst from Mayban Securities however says that AirAsia will likely tap as much as it can from these possible new routes. 'It depends on how AirAsia gets the routes subsidised. For example, they are now in talks with Malaysia Airports (Holdings Bhd) on lower airport charges.''

Over the week, AirAsia inked a US$1.5bil engine service agreement with General Electric Co of the US for a period of 20 years to repair and maintain its aircraft engines. The budget liner has also inked a US$750mil agreement with CMF International to acquire aircraft engines.

These acquisitions and maintenance contracts are in anticipation of the company acquiring some 60 Airbus A-320 aircraft with an option to purchase an additional 40, in a deal valued at close to RM14.5bil. Delivery of the aircraft is expected to commence by year-end.

With much excitement surrounding the company, AirAsia's shares have gained some 15 sen or 10% over the past two weeks. It ended trading on Thursday at RM1.70.

AirAsia To Introduce Flights Within S'wak
June 21, 2005 16:25 PM



KUCHING, June 21 (Bernama) -- To boost its presence in Sarawak, Budget carrier AirAsia is expected to introduce flights within the state, Urban Development and Tourism Minister Datuk Seri Wong Soon Koh said.

Speaking during the winding-up session for his ministry at the State's Legislative Assembly sitting here Tuesday, Wong said that presently AirAsia has increased its flights frequency to 13 flights daily from two flights per day from Kuala Lumpur to Kuching, Sibu, Miri and Bintulu.

"I have been informed that it will soon introduce internal flights within Sarawak," he said.

He added that the carrier has contributed significantly towards improving domestic flights frequency particularly for the state.

On the tourism front, Wong said that tourist arrivals had increased in the last two years.

"Our visitor arrivals for last year is 2.65 million, an increase of 11.97 percent over 2.37 million in 2003," he said.

He said that Sarawak's main markets were Brunei (1.3 million), West Malaysia and Sabah (409,783) Indonesia (401,552), UK and Ireland (44,498), Singapore (41,566) and Australia and New Zealand (29,509)

However, the number of long haul visitors to Sarawak was still low due to inadequate promotion of the state as among the nation's tourism destinations, limited airlinks and small marketing budget, Wong said.

Apart from that, he said that airfare was also a factor, which resulted in the lesser long haul visitors as it was expensive for travellers to extend their journeys from Kuala Lumpur and Singapore to Sarawak.

To increase visitor arrivals, Wong said that marketing efforts would be intensified in Peninsular Malaysia, Singapore, Brunei and Kalimantan through strategic marketing programmes.

Such programmes would be cheaper and allow the local tourism industry to be well prepared for the more demanding long haul visitors, he said.

-- BERNAMA

Airbus 320...The 1st wil be delivered to AirAsia on next December.

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AirAsia Selects CFM56-5B To Power A320s In RM2.85 Bln Order
June 14, 2005 15:15 PM



KUALA LUMPUR, June 14 (Bernama) -- AirAsia, the leading low-fare airline in South East Asia, has unveiled its engine choice for its 100-aircraft Airbus A320 order, of which 60 are firm order and 40 purchase rights.

The airline has selected CFM International's CFM56-5B engine to power the A320s scheduled to begin joining the AirAsia fleet as early as December this year.

The purchase agreement for the firm engine order, which covers a total of 120 engines plus nine spares, is valued at about US$750 million (RM2.85 billion) at list price, AirAsia said in a statement.

An official signing ceremony was held between both parties at one of largest aerospace events of the year, the 2005 Paris Air Show at Le Bourget.

The purchase agreement was signed between CFM president and chief executive officer Pierre Fabre and AirAsia Bhd group chief executive officer Tony Fernandes.

The ceremony was witnessed by Deputy Prime Minister Datuk Seri Mohd Najib Abdul Razak and Transport Minister Datuk Seri Chan Kong Choy.

"The decision (by AirAsia) reaffirms the CFM56-5B's position as one of the most reliable engines in the world," Fabre said.

CFM, a joint venture company between Snecma and General Electric Company, is the world's leading supplier of commercial aircraft engines, with more than 15,000 in service worldwide.

"We believe in aligning ourselves with the best. While cost is of an essence to the nature of our business, there's no denying that the beauty of the CFM56 engines lies not only with its high reliability and long on-wing life, but also its ability to complement the A320," Fernandes said.

"These attributes, coupled with CFM's reputation as one of the leading suppliers of commercial aircraft engines, would only serve to drive AirAsia's cost structure downwards and effectively give consumers a very good product and value for their money," he said.

More than 1,700 CFM56-5B engines have been delivered to date, and the fleet is growing at a rate of about 20 engines per month.

AirAsia operates a fleet of 26 Boeing 737-300s powered by the CFM56-3 engines, serving more than 51 domestic Malaysian and regional routes.

The new A320-200s will support the its aggressive growth and expansion, the airline said.

AirAsia, due to become the single largest Airbus A320 operator in the Asia-Pacific region with its recent aircraft order, will operate a mixed fleet during the transition from Boeing 737-300s to the Airbus A320.

The 180-seat A320s will enter the fleet from 2005 until 2011.

-- BERNAMA

AirAsia to offer wider range of products online
Updated : 29-06-2005
Media : Business Times




BUDGET carrier AirAsia Bhd aims to offer a wider range of products online by year-end upon the completion its website upgrading exercise.

AirAsia regional information technology (IT) director Lau Kin Choy said in Kuala Lumpur yesterday that the exercise, which will be carried out by local IT solutions provider The Media Shoppe Bhd (TMS) in three phases, will further enhance the ease and delivery of its customer online experience.

However, he gave an assurance that the upgrading process will not cause any disruption to the airline¡¦s online transaction.

AirAsia will opt for TMS¡¦ award-winning enterprise knowledge portal (tmsEKP) solution to replace the existing portal and facilitate the administration of a multi-lingual content website at higher levels of efficiency.

The usage of the tmsEKP solution will enable the airline to improve their e-marketing offerings by adding e-cards, e-calendars, image galleries and an online shopping cart.

TMS chief executive officer Chris Chan said the company is happy that its homegrown technology is able to support and encourage further expansion and development of another successful homegrown company.

¡§The tmsEKP will be used to increase AirAsia¡¦s thriving growth to revamp their content management system and initiate a new implementation of collaborative and interactive portal,¡¨ he said.

With over three million hits a month, AirAsia¡¦s own www.airasia.com is one of the most widely surfed booking engines on the World Wide Web and voted as the most popular website for shopping in the 11th Malaysia Internet User Survey conducted by AC Nielsen Consult.

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AirAsia Puts On Hold Plan To Impose Fuel Surcharge
Updated : 30-06-2005
Media : Bernama



AirAsia, one of the largest low-cost carriers in Asia, has put on hold its plan to impose fuel surcharge pending the government's decision on the rationalisation of domestic air services.

AirAsia's group chief executive officer Tony Fernandes said even if increasing fuel prices make it tougher for company to keep operation costs low, the carrier would still wait for the outcome of the rationalisation exercise before making any decision on the fuel surcharge.

Recently, the Transport Ministry said that it was working towards the rationalisation of domestic air services which involved the routes serviced by Malaysia Airlines (MAS) and AirAsia.

"We hoped the rationalisation will come soon. The fuel prices have continued to rise," he told Bernama Thursday after presenting a keynote address at the National Human Resources Summit 2005 here.

Fernandes said the rationalisation of domestic routes is important to AirAsia as the company now has to bear the cost of escalating fuel prices while MAS has its domestic route operations being subsidised by the government.

AirAsia had notified the government in April of its plans to impose fuel surcharge on all flights, including domestic and regional routes, with the charges reported to be less than 10 percent.

However, the carrier, which had registered five million passengers last year, has so far not imposed any fuel surcharge either on domestic or regional routes.

MAS, on the other hand, has raised its fuel surcharge for long haul international flights from RM50 (US$13.15) to RM76 (US$20), and for regional flights from RM15 (US$3.95) to RM38 (US$10), beginning May 1.

In the domestic sector, for flights between Peninsular Malaysia and Sabah or Sarawak, the surcharge imposed was RM15 (US$3.95) while for flights within the peninsula and the states, it was RM7.50 (US$1.97).

AirAsia Seeks Speedier Decision On Rationalisation Of Domestic Routes
Updated : 01-07-2005
Media : Bernama



AirAsia Bhd has sought for a speedier decision from the government on the rationalisation of domestic air services which involves the routes serviced by the low cost carrier and premier airline, Malaysia Airlines.

Chairman of AirAsia Datuk Pahamin A. Rajab said AirAsia had submitted a memorandum to the Ministry of Transport on the rationalisation of the domestic routes.

But it has yet to receive any response from the government.

AirAsia reiterated that a fast decision on the rationalisation of domestic routes was important to AirAsia as the company was now bearing the cost of escalating fuel prices.

Group chief executive officer of AirAsia, Tony Fernandes, was quoted as saying that the airline had put on hold its plan to impose fuel surcharge pending the government's decision on the rationalisation of domestic air services.

When asked on the cause of the delay in formalising the decision for the rationalisation, Pahamin said, "I wish I have the answer."

Pahamin was speaking to reporters at the sideline of the launching of direct debit service of AirAsia tickets via Maybank2u.com, here Friday.

He added that that although AirAsia had the advantage of time, the low cost carrier could not sustain in terms of managing the cost in the long run.

He said AirAsia was competing in other markets, such as in Cambodia, Vietnam, the Philippines, China, adding that, "We do not want to compete, but rather co-exist with MAS."

Similar to that of Tiger Air which is being strongly supported by the Singaporean Government, Pahamin said AirAsia also needs to be seen being supported by the government since they had made Malaysians proud by being the pioneer in the low-cost travel field.

Maybank2u.com, AirAsia To Offer Direct Debit Service
July 01, 2005 19:42 PM



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KUALA LUMPUR, July 1 (Bernama) -- Maybank2u.com and no-frills airline, AirAsia Bhd Friday launched a new partnership, where customers can use Maybank2u.com to make direct payments for AirAsia flights.

Using the direct debit service, customers can now directly reserve and purchase their flights at AirAsia's portal at www.airasia.com and pay directly from their accounts via Maybank2u.com at AirAsia's website.

In a joint conference Friday, both parties said the new service was expected to further boost and drive internet sales for the airlines, whilst adding to the growing transaction from Maybank2u.com customers.

Group chief exective officer of AirAsia, Tony Fernandes said at present, 56 percent or about 30 million of AirAsia's bookings were done online via the Internet, but was limited to credit card users.

"But this new debit service with Maybank opens up a new and huge market for us. We hope online booking will touch 70 percent of the total bookings not in the distant future," Fernandes said.

"But this would also depend on how well we promote this service to both customers," he told reporters at the launching of the service here, today.

Also present were chairman of AirAsia Datuk Pahamin A.Rajab and senior executive vice president, Head, Retail Financial Services Group of Maybank Datuk Johar Che Mat.

The debit service had todate, shown tremendous response from Maybank2u.com customers, recording about 30,000 transactions since its introduction two and a half weeks ago.

Meanwhile, Johar said Maybank would also look at the possibility of offering payment service for AirAsia tickets via Autoteller Machines (ATM) as what was being provided to Malaysia Airlines customers.

"There is a possibility (of offering such service for AirAsia customers). It is part and parcel of our agenda in the long run," he added.

Updating on the number of users of Maybank2u.com, Johar said Maybank2u.com remained the most popular internet banking portal.

"When we started, we had about 300,000 registered customers, but today, our registered customer base has grown a remarkable 600 percent to over 1.8 million registered users," he said.

According to Johar, Maybank2u.com registered a monthly average of over 3.6 million transactions online while the average value of its monthly transactions was about RM0.7 billion.

Maybank2u.com also celebrates its 5th anniversary Friday.

-- BERNAMA

Malaysia AirAsia Forecasts Regional Budget Air Consol -FT
Updated : 04-07-2005
Media : Dow Jones



SINGAPORE (Dow Jones)--The head of AirAsia Bhd. (5099.KU) is forecasting a wave of consolidation in Asia's fast-growing budget airline sector as rising fuel prices and firmer aircraft leasing rates put pressure on new entrants, the Financial Times reports on its Web site Monday.

Tony Fernandes, chief executive of the Malaysia-based group, said in an interview Sunday that many new no-frills ventures face much tougher operating conditions.

"I think business plans are looking quite different, and I think there's going to be a rationalization for sure. I think it's inevitable," Fernandes is quoted as saying. The comments come less than a week after Valuair and Jetstar Asia, two discount airlines based in Singapore, announced they were in talks that could lead to an alliance or merger.

The negotiations are a sign that the industry could be set for a shake-out after a period of rapid growth, with a host of new low-cost carriers having been set up across southeast Asia and India in the past three years.

"At US$25 jet fuel [a barrel], with aircraft leasing where it was and people seeing how well we were doing, there was a herd mentality, with many people chasing what they thought was easy money," Fernandes said.

"I think their business plans have obviously changed dramatically, with jet fuel now at $75 [a barrel] and a hardening in aircraft [leasing] pricing," he added, according to the report.

AIRASIA IN TALKS TO BUY SINGAPORE'S VALUAIR - REPORT
Updated : 20-07-2005
Media : AFX




SINGAPORE (XFN-ASIA) - Malaysian budget airline AirAsia is in discussions to buy Singapore rival ValuAir, a move that could block a merger between Valuair and JetStar, another Singapore-based budget carrier owned by Qantas Airways, the Business Times newspaper reported.

The newspaper said AirAsia chief executive officer Tony Fernandes and Valuair chairman Lim Chin Beng met yesterday evening in Singapore.

But Valuair executive vice president Arthur Lim declined to confirm or deny that Fernandes and Lim met.

Citing unnamed sources, the newspaper said Fernandes had proposed to buy ValuAir's operations for 20 mln sgd. Fernandes is also believed to have proposed the leasing of two of ValuAir's planes by Airasia as well as cutting costs by dropping Valuair's unprofitable routes.

The leasing of Valuair's planes to AirAsia is a win-win situation for the two parties as this will help augment AirAsia's capacity shortage as well as reduce Valuair's losses, the newspaper cited industry sources as saying.

SINGAPORE PRESS: AirAsia May Be Making Bid For Valuair
Updated : 20-07-2005
Media : Dow Jones
Story By : Carolyn Lim




(Dow Jones)--Malaysia's AirAsia Bhd. (5099.KU) may be in talks to take over Singapore-based rival Valuair, the Singapore Business Times daily reports.

AirAsia Chief Executive Tony Fernandes is understood to have made a presentation to Valuair shareholders late Monday, the paper reports, noting that Fernandes and Valuair shareholders were both spotted in the same building late Monday.

AirAsia is Southeast Asia's biggest low-cost carrier, or LCC, in fleet size terms and the region's only publicly-traded LCC.

The paper quotes sources as saying AirAsia has laid out a plan for Valuair shareholders to completely exit their unprofitable investment for about S$20 million.

The report also says that Fernandes believed he could stem Valuair's red ink within two months of taking over. Other measures Fernandes is believed to have proposed include dropping Valuair's unprofitable medium-haul routes. Valuair flies to Perth, Hong Kong, Bangkok and Jakarta from Singapore.

The paper cites Valuair Executive Vice President Arthur Lim as not confirming nor denying a meeting with AirAsia. An AirAsia spokeswoman also couldn't comment whether a meeting had taken place when contacted by Dow Jones Newswires Wednesday.

The report follows earlier newspaper articles that said Valuair and Jetstar Asia are again discussing a possible merger.

Valuair and Jetstar Asia, in which Australia's Qantas Airways (QAN.AU) has a 49% stake, are under pressure to consolidate amid intense competition and soaring fuel costs.

Malaysia AirAsia Won't Rule Buying Singapore Valuair
Updated : 20-07-2005
Media : Dow Jones





(Dow Jones)--AirAsia Bhd. (5099.KU) won't rule out buying Singapore rival Valuair, Raja Azmi Raja Razali, chief financial officer of the Malaysian low-cost carrier, or LCC, said Wednesday.

"Yes, we have not ruled out (this acquisition)," Raja Azmi said when asked whether AirAsia is still considering the possibility of buying Valuair.

AirAsia is Southeast Asia's biggest low-cost carrier, or LCC, in fleet-size terms, and the region's only publicly-traded LCC.

Still, Raja Azmi couldn't say if and when AirAsia might buy Valuair. "It's still too premature; I cannot comment," he said.

Earlier Wednesday, a Valuair spokesman said he could "neither confirm nor deny" reports about possible interest from AirAsia.

Singapore's Business Times daily reported Wednesday that AirAsia may be in talks to take over Valuair.

AirAsia Chief Executive Tony Fernandes is understood to have made a presentation to Valuair shareholders late Monday, the paper said, noting that Fernandes and Valuair shareholders were both spotted in the same building late Monday.

The paper quoted sources as saying AirAsia has laid out a plan for Valuair shareholders to completely exit their unprofitable investment for about S$20 million.

The report also said Fernandes believed he could stem Valuair's red ink within two months of taking over. Other measures Fernandes is believed to have proposed include dropping Valuair's unprofitable medium-haul routes. Valuair flies to Perth, Hong Kong, Bangkok and Jakarta from Singapore.

The report follows earlier newspaper reports that Valuair and Singapore-based Jetstar Asia are again discussing a possible merger.

Valuair and Jetstar Asia, in which Australia's Qantas Airways (QAN.AU) has a 49% stake, are under pressure to consolidate amid intense competition and soaring fuel costs.

AirAsia undertaking due diligence on Valuair, say sources
By Doreen Leong, 20 Jul 2005 10:00 PM




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AirAsia Bhd is believed to be undertaking a due diligence on Singapore-based rival Valuair Ltd, which may pave the way for the Kuala Lumpur-based low-cost carrier (LCC) to take over the latter, say sources.

It has been reported that AirAsia’s chief executive officer Tony Fernandes made a presentation to Valuair shareholders on July 18, on plans to turn around the loss-making company.

Singapore’s Business Times reported on July 20 that the proposal included a plan for Valuair shareholders to completely exit Valuair for S$20 million (RM45 million).

Currently, Valuair flies to Perth, Hong Kong, Bangkok and Jakarta from Singapore. Fernandes could not be reached for comment.

Quoting AirAsia’s executive director Kamarudin Meranum and chief financial officer Raja Azmi Raja Razali, news wires yesterday reported that AirAsia was not ruling out buying Valuair and that any deal depended on what offer was on the table.

Analysts viewed any move by AirAsia to buy Valuair positively as it will be more beneficial to have fewer players in the region’s “overcrowded” skies.

They said industry players were under pressure to consolidate amid intense competition and soaring fuel prices. “With the new operation landscape, LCCs need to re-focus their strategies to consolidate.”

One analyst said concerns lingered over the high oil prices, which are expected to hover between US$50 (RM190) and US$60 per barrel and not likely to return to the low levels of about US$30 per barrel.

He said AirAsia’s move did not come as a surprise as there were always “sparks” pointing towards consolidation in the aviation industry.

However, one analyst said there were concerns on how AirAsia would structure the acquisition of Valuair.

“I don’t think AirAsia has the financial muscle. It does not have the cash capacity. So the possibilities will be either via equity (in AirAsia for Valuair shareholders) or for the company to raise debt.”

Maintaining a RM1.48 fair value for AirAsia, the analyst said additional funding for the acquisition would “stretch its operations” as it has committed to taking delivery of up to 100 Airbus planes over the next eight years.

AirAsia Won't Partner Valuair, Says Fernandes
July 22, 2005 19:11 PM
From Shanti Ayadurai




HONG KONG, July 22 (Bernama) - AirAsia would not be going into a partnership with Singapore's Valuair, said Datuk Tony Fernandes, CEO of the Malaysian no-frills airline, Friday.

He said the business approach of the two entities was different and they would not be able to fit.

"Our approach has been strictly no frills," he said, citing one of the factors for AirAsia's success has been its disciplined approach.

He made these remarks to reporters after having signed a sponsorship deal with Manchester United as the club's official low fare airline here Friday.

Manchester United are currently on an Asian tour here. The ceremony was also attended by English soccer legend Sir Bobby Charlton, a one-time England and Manchester United player, and currently a director with the club.

The deal makes AirAsia as Asia's first low cost airline to have successfully associated itself with one of the biggest soccer clubs in the English Premier League.

In signing the sponsorship deal here Friday with Manchester United's Commercial Director Andy Anson, Fernandes said the agreement would include global above and below the line advertising and sponsorship activity from next month.

The Manchester United team will be used to promote the low cost airline both in Asia and as far as Europe.

The advertising will also cover AirAsia's associate companies Thai AirAsia and AWAIR in Indonesia.

Fernandes said one of the reasons for the sponsorship would be to expose AirAsia to the European market to promote the low cost airline as a way to travel around the Asian region at very low cost.

Although declining to provide details on the value of the sponsorship, he said the deal would be of great value, with a lot of exposure for the airline during Manchester United's football matches via television airtime.

To a question if Air Asia was planning to strike a deal with the Hong Kong airport authorities following its first direct flight to Hong Kong today, Fernandes said that he would be meeting them for "talks today", but declined to give details.

He, however, added: "If we get the landing rights in Hong Kong, it would be good, but if we don't, we would be happy flying to Macau."

AirAsia, together with its associate companies, carried over 11 million passengers since its low-cost approach came into being in 2001.

It has an extensive network that covers Malaysia, Thailand, Indonesia, Macau, China, Singapore and the Philippines serving 52 destinations, making it the largest low cost carrier in the region in terms of destinations.

Fernandes said one of the reasons for the partnership with Manchester United was the club's similar trail to success.

"Like Manchester United which started small but went on to become the world's biggest football club, we too started with only two planes and 200,000 passengers. Next year, we expect to record eight million passengers," he said.

-- BERNAMA

AirAsia higher on hopes of savings on ringgit float
Updated : 22-07-2005
Media : AFX
Story By : Alice Chia


(XFN-ASIA) - Budget carrier AirAsia Bhd was higher in early trade on hopes that it will see substantial cost savings if the ringgit strengthens following the removal of the seven-year peg, dealers said.

The stock was up 0.14 rgt or 8.43 pct at 1.80 on volume of 5.78 mln shares.

The central bank late yesterday scrapped the ringgit's seven-year old peg to the dollar and moved to a managed float against a basket of currencies with immediate effect.

The New Straits Times quoted AirAsia's chief executive officer Tony Fernandes as saying that if the ringgit does strengthen, it will result in a cost-saving of between 6 and 10 pct for the company.

AirAsia Plays It Cool Over Orange Star 'Threat'
Updated : 28-07-2005
Media : Bernama



SINGAPORE, July 28 (Bernama) -- AirAsia, Asia's leading low- fare airline, is playing it cool over the competition it is facing from Orange Star, the new player in the regional low-fare market.

Orange Star emerged on the scene last weekend as a result of the merger between two Singapore-based low-fare airlines -- Jetstar Asia and Valuair.

AirAsia's chief executive officer Tony Fernandes said he did not think that there will be any change in the competitive landscape.

"I think Jetstar Asia would be competitive whether or not they have Valuair. It would be facetious to say there's no threat. I mean, they have a lot of money," he told the Business Times newspaper.

AirAsia reportedly offered S$20 million (RM45 million) for Valuair but it was Jetstar Asia that clinched the deal with Valuair, reportedly for a S$60 million (RM135 million) in capital injection.

Aviation analysts described the joining of forces between Jetstar Asia and Valuair as a signal that the low-fare industry was consolidating in the face of an extremely competitive Asian market made more painful by the escalating fuel prices.

Among the low-fare players in Asia, Orange Star has the most extensive routes, serving destinations like Hong Kong, Jakarta, Bangkok, Chengdu, Manila, Perth, Xiamen and Taipei.

Fernandes said the deal with Valuair was something "that AirAsia looked at and that we walked away from". He told the Business Times that AirAsia was not interested in going for bidding war.

"What I think we would have done is that we would not have pumped in as much cash but we would have pumped in all the cost savings that add up effectively in cash," he said.

But he added that the deal nevertheless gave AirAsia a good insight into the island state's low-fare industry -- that it was "a very hard industry to make money".

Strengthening Of Ringgit Against Us Dollar Helps AirAsia Reduce Cost
Updated : 02-08-2005
Media : Bernama




AirAsia is bullish that the strengthening of the ringgit against the US dollar will help reduce the company's operational expenses.

Its chief executive officer, Datuk Tony Fernandes said as most of AirAsia expenses are quoted in US dollar such as aircraft purchase, maintenance expenses and fuel charges, a one percent-10 percent changes in the dollar would have substantial saving to the company's overall cost.

However, there could also be some impact to the current rising fuel prices.

"While we may experience the increase in fuel prices, we think we could still manage to stay competitive in the industry," he said on the sidelines of the Asian SME Convention 2005, here Tuesday.

He said the rising fuel prices would limit the entry level of new low cost carriers (LCCs) in the industry and thus give the established carriers a better edge.

AirAsia according to Tony, is also looking at opportunities for potential tie-up with other operators of LCCs regionally.

This will enable AirAsia to spread its wings further in the aviation industry and capture a bigger market share.

AirAsia not worried about competition
Updated : 04-08-2005
Media : The Edge
Story By : Malar Velaigam




AirAsia Bhd chief executive officer Datuk Tony Fernandes has shrugged off concerns about competition from other low-cost carriers (LCC) when the LCC terminal at KLIA is operational by April 2006.

Fernandes said he was not worried about potential cannibalisation of AirAsia¡¦s market share once the ¡§hub¡¨ was fully functional.

Instead, he said the LCC terminal should lead to higher demand, and AirAsia was preparing to expand its fleet from the current 18 aircraft to about 30.

¡§We will be getting our first airbus this December, which has an extra 32 seats,¡¨ said Fernandes. ¡§We hope to have about five Airbus aircraft by the time the (LCC) terminal is ready,¡¨ he added.

Fernandes was speaking to reporters after visiting the LCC terminal at the KLIA in Sepang. Also present at the site visit were Transport Minister Datuk Seri Chan Kong Choy and Malaysia Airports Holdings Bhd managing director Datuk Seri Bashir Ahmad.

Chan said the LCC terminal was one of the measures taken by the government to help local airlines. He said the government had also extended the war risk insurance indemnities for both Malaysia Airlines and AirAsia for another year.

The terminal was designed primarily to AirAsia¡¦s specifications, and was based on conditions such as a simplified baggage system, no aerobridges and allowing aircraft to turn around within 20 minutes.

Fernandes said the LCC terminal was expected to boost AirAsia's efficiency significantly, although he did not have any figures yet in terms of cost savings.

Bashir said work on the LCC terminal was about 2% ahead of schedule. ¡§It is about 16.7% complete, compared to the planned 14.8%,¡¨ he added.

The LCC terminal, scheduled for completion by April 2006, will be able to handle 10 million passengers annually, and the capacity can be expanded to 15 million if need be.

¡§It will be the second largest airport in Malaysia, after KLIA, and will be able to park up to 30 aircraft,¡¨ said Chan.

The LCC terminal is expected to handle three to four million passengers per annum ¡§straight away¡¨, according to Bashir, but it would probably reach its capacity of 10 million in about five to six years.

AirAsia May Consider Rising Fares
Updated : 10-08-2005
Media : Bernama





AirAsia Bhd may consider increasing its fares to deal with the current rise in oil price, said chief executive officer, Datuk Tony Fernandes, here Wednesday.

"A RM1 or RM2 rise doesn't change much in elasticity. Our fare is still very low but it (fare hike) will help us very much in covering the extra cost," he told reporters when met at an award presentation to RHB Bank for the RHB AirAsia MasterCard Programme.

The bank received a Gold Award for the Best Chip Card Programme.

Jet fuel represents 43 percent of total operation cost for AsiaAsia.

Oil prices hit an all time high of US$64 per barrel on Monday.

"We are pro-active in cutting cost. We want to keep the fares low as that is very important for us. It is getting tougher and tougher to keep the fares down with fuel (prices) where it is now," he said.

"For us a RM5 or RM10 rise will make a big different. We can cover a lot of our cost and I don't think it will affect our demand so much. Even at this high fuel prices, we still can give very attractive fares.. so we have just continued doing it," he said.

Besides increasing the airfare, Fernandes said that there were many other ways of covering fuel surcharges.

"We can sell more seats at low fares. Our load factor is now about 70 percent. If we can go up to 80 to 90 percent, it will cover a lot of the cost even if the fare is low," he said.

Fernandes is confident that the budget carrier could deal with the current higher fuel prices.

"We have to be more aggressive in advertising and promotion. We are spending about two to three percent of our sales but depending on the markets and routes," he said.

Asked on possible margin squeeze, Fernandes said "not necessarily."

"Obviously, if we have a high load-factor, if we can up the prices a little bit, it won't make a huge difference to the consumers but a big difference to us," he said.

Looking forward, Fernandes said there will be a lot of upside in AirAsia. "Most of our routes are brand new routes and the routes take time to develop. We have another 30 percent seats to sell," he said.

As for further acquisition, Fernandes said that if there are such opportunities the company will look at it but "we have our hand pretty full at the moment."

Pertaining to the Valuair deal, he said that AirAsia did not see any value in it "so we did not go for it."

And on new destinations, Fernandes said that AirAsia hoped to fly to Brunei, Cambodia and Vietnam within the next six months.

Fernandes expects the carrier to fly about 8.0 million passengers next year.

AirAsia can handle fuel hike, says Fernandes
Updated : 10-08-2005
Media : The Edge
Story By : Alfean Hardy





AirAsia Bhd is still able to handle the current high oil prices despite the fact that aviation fuel has hit US$75 (RM281.10) per barrel, said the group's chief executive officer Datuk Tony Fernandes.

Oil is something that all airlines have to deal with, not only AirAsia, and we will find ways to increase income and reduce costs. The key is keeping the fares down,¡¨ he said.

Fernandes, who was speaking to reporters in Kuala Lumpur on Aug 10, admitted there was the temptation to raise prices in order to cover the recent high prices.

We are under a lot of pressure to tweak them up but one to two ringgit rise doesn¡¦t change much in terms of elasticity but it helps us, dramatically, in covering the extra costs,¡¨ he said.

We do want to keep the costs down; that¡¦s very important for us. We want more and more people to fly,¡¨ he added.

Fernandes said at US$64 per barrel of crude, AirAsia would still levy a fuel surcharge with the charge dependent upon the destination. However, he said his airline's margins have yet to be squeezed.

Not necessarily. If we can increase our load factor, if we can tweak our fares a bit¡K our costs are so low and our volume is high, so a little bit tweaking can cover quite a bit.

There are many ways to cover fuel surcharges. You can sell more seats at lower prices. Our load factor is about 70% and if we can go up to 80% to 90% that can cover a lot of our costs,¡¨ he added.

All was not doom and gloom, however, and Fernandes said there was a ¡§silver lining¡¨ behind the high fuel prices.

At US$75 per barrel for jet fuel, there are fewer people raring to get into this industry and the competitive side of the business has definitely been a plus for AirAsia going forward,¡¨ he said.

Meanwhile, Fernandes said within the next six months, AirAsia would be flying to Brunei, Vietnam and Cambodia.

RHB AirAsia MasterCard hits 100,000 users (Updated)
By Alfean Hardy, 10 Aug 2005 9:35 PM





The RHB AirAsia MasterCard, a co-branded credit card issued by RHB Bank Bhd, has within a year of its launch performed far beyond expectations by capturing 100,000 users and winning an award for Best Chip Card programme under the MasterCard Asia/Pacific Marketing Leadership Awards 2005.

The annual awards saw more than 200 financial institutions in 13 countries vying for 18 categories that range from Best Commercial Card to Regional Award for Marketing Excellence.

Speaking to reporters in Kuala Lumpur on Aug 10, RHB Bank executive vice president and consumer banking division head Michael Lor said he was very happy with the performance of the card. “We did it in less than a year, in the 11th month. We wanted 30,000 cards; we got 100,000,” he said.

“In this period, we grew 150,000 cards (in total), of which the AirAsia card accounts for two-thirds,” he added.

RHB currently has six cards in the market with the 150,000-user RHB EVO MasterCard being the most popular. Lor said the bank currently had about 550,000 cards in the market, holding a 7.1% market share domestically.

AirAsia Bhd group chief executive officer Datuk Tony Fernandes said: "I believe we will have one million cards one day. We’re 10% of the way."

“Next year, we will carry eight million people and the rewards get better and better and as the consumers get more educated as to the benefits, more people will want one,” he added.

“If the market feels it’s worth getting, it should be really quick (to reach one million cards). It may be a lofty target but three years ago, when we carried 200,000 guests, eight million seemed impossible.,” he added.

Fernandes said the RHB AirAsia card was not his company’s first as AirAsia has 25,000 co-branded cards in Singapore and 50,000 co-branded cards in Thailand, for “close to 200,000 cards in Asean” within a year and a half.

Meanwhile, MasterCard Asia/Pacific Pte Ltd vice president and Malaysia and Brunei senior country manager Jim Cheah was optimistic about the growing success of MasterCard in Malaysia.

“There are seven million credit cards in total in circulation in Malaysia and we have four and a half million cards on issue in the market place,” he said.

“We don’t give forecasts but we are optimistic about the market because it looks pretty positive,” he said.

So much to read! I guess I will ask it now, hehehe... I saw the prices from KLIA to Macau is around RM100+ one way... is that the price I pay on the same day I fly? I heard I have to book it for that price like 6 months before departure??? Please let me know how much it is because I am taking my parents to HK this October :D:D

AirAsia's CEO Comments on Hong Kong Flights
Wednesday August 10, 7:31 am ET

SEPANG, Malaysia (AP) -- Budget carrier AirAsia will not fly to Hong Kong because of high landing costs, the company's chief said, and warned that the airport there risks losing out to rival hubs unless it sheds its "arrogant" attitude and welcomes low-cost airlines like his.

Malaysia-based AirAsia Bhd., the region's biggest no-frills airline by fleet size, also remains years away from operating in India, but plans to launch flights to Cambodia, Laos and Vietnam by mid-2006, chief executive Tony Fernandes said in an interview with The Associated Press Tuesday.

Air Asia currently has routes covering Malaysia, Indonesia, the Philippines, Thailand and Macau, Hong Kong's neighbor. Its joint venture with Thailand's Shin Corp., Thai AirAsia, began flying between Bangkok and Xiamen, China, last year, making it the first foreign low-cost carrier to fly to mainland China.

AirAsia's discussions to gain an entry into Hong Kong ended abruptly last year. Its talks with Hong Kong Airport Authority resumed last month but apparently ended in a deadlock.

Fernandes said AirAsia's chances of flying to Hong Kong are "zero right now."

"I don't think they're serious," he said. "They're not doing anything, they're not trying to understand what we want," he said, adding that Hong Kong's airport demands ground handling service fees that are "many, many more times" what AirAsia pays in Macau.

He declined to provide specific figures.

The Hong Kong Airport Authority, responding to Fernandes' comments, on Wednesday denied that it discriminates against budget airlines, stressing that its airport charges are "transparent and equitable to all."

Seven carriers that operate low-fare flights currently use the Hong Kong airport, the authority said in a statement, adding that it would "continue to work with all potential business partners, be they full service carriers or low-fare airlines."

Fernandes said the airport's refusal to lower costs was "typical of an arrogant, old-fashioned airport," and accused its top management of acting like an "old colonial."

Fernandes said AirAsia is asking for reduced rates because its planes spend relatively little time on the tarmac thanks to quicker turnarounds. The airline is also willing to operate during off-peak hours and use parking bays and check-in counters that are less popular.

Meanwhile, airports in Macau and mainland China, which are a short ferry ride away from Hong Kong, are "hungry for business" and eager to embrace budget carriers, Fernandes said.

"The competition around them is waking up real fast," he said. "You miss the boat and your competitors catch up."

While the airline plans to expand routes in Southeast Asia, it will stay away from India, a massive market that has seen a proliferation of budget carriers despite lack of infrastructure, Fernandes said.

"We're not ready (but) we will be one day," he said. Fernandes confirmed AirAsia will receive its first Airbus A320 planes in December, adding that they would probably be used initially for routes on Malaysia's eastern states on Borneo island.

The airline, which plans to phase out its current fleet of Boeing 737-300s over the next five years, signed a purchase order for 60 Airbus aircraft last March.

Ahh... I found how they price the air tickets liao. The earlier you book, the cheaper will the price be... How do I know if I got holidays or not in 3 months ni? sigh...

Ahh... I found how they price the air tickets liao. The earlier you book, the cheaper will the price be... How do I know if I got holidays or not in 3 months ni? sigh...

I am going to Kuching in October and I booked since March :D

Not only that it is cheaper the earlier you booked......but it also depends on wether it is weekend or not. If it is like Friday,Saturday or Sunday flight....or if it is a public holiday or not...no matter how many months ahead also it would be expensive. ;)

So technically the cheapest would be like on a Wednesday 8 months from now :D

Im leaving for Bangkok this November. Booked it last February :lol:
Cheap cheap..Yes. The price change everyday

AirAsia to use brand, expertise to expand
Updated : 13-08-2005
Media : Business Times




AIRASIA plans to take advantage of its brand and expertise to expand its low-cost carrier business model to other countries in the region.

"All in due time. What is important is to make sure you can cope with the expansion and that the expansion is within our own capabilities," chief executive officer Datuk Tony Fernandes said.

In a statement, he said it is a challenge for AirAsia when its sees opportunities and competition coming.

"But I think we have got that critical mass and we don't need to grow at that great speed anymore," Fernandes said. "We have got a great name 'AirAsia' that allows us to go to a lot of places."

Fernandes said AirAsia has no plans to increase prices in response to higher fuel costs, and hopes that fuel surcharges will eventually be removed.

"Our fuel surcharges are the lowest in the world and with the ringgit peg coming off, that's a saving for us. The fuel surcharges hopefully won't be there in the long run. Ultimately AirAsia fares are still pretty low," he added.

Fernandes said it is also not entirely true that quality is being compromised as a result of low air fares.

"Quality of service is circumstantial. If you want a 6-star airline, you are not going to get that, we are a 3-star product. That doesn't mean our planes are not safe and we do not treat you nicely on the plane.

"We may not give you food, we may not give you an assigned seat but our services are as good as anyone else once you get on board," he said.

Fernandes said AirAsia believes that additional services such as in-flight entertainment are things that its passengers may not need and would prefer to have lower fares.

On the emergence of more low- cost carriers in South-East Asia being a threat to AirAsia, he said the struggle they are facing shows that this is not an easy business.

"It is silly to say there's no threat at all as both, Tiger and Jetstar have very deep pockets. But the reality is how long would you continue running a loss making business? and how long the parent company is willing to fund it," he added.

Fernandes will speak on "Globalising and sustaining an Asian Brand - The AirAsia Story" at the Global Leadership Forum (www.glf2005.org) next month.

The forum will be held on September 6 and 7 2005 at the Kuala Lumpur Convention Centre.

AirAsia Will Get US$1.2 Bln Financing For 33-Airbus Fleet
Updated : 12-08-2005
Media : Bernama



AirAsia Bhd Friday said it had received favourable responses at competitive prices to its request for financing its Airbus aircraft acquisition.

In a filing to Bursa Malaysia Friday, the budget carrier said the initial financing will be limited to the first two year aircraft deliveries from December 2005 to December 2007 for 33 aircraft.

AirAsia has a firm order of 60 Airbus A320-200 aircraft and purchase rights for a further 40 of the same aircraft and the selection of CFM 56-5B6/P engine to be installed and as spare engines for the fleet.

The total size of the deal is valued approximately US$1.2 billion, all of which will be funded by loans from financial institutions, AirAsia said.

It said the board of directors had approved the proposed financing structure and the proposal was currently awaiting the approval from the relevant authorities.

Further announcements will be made upon approval by the relevant authorities, it added.

AirAsia Expects More Transactions Via Mobile Phones
Updated : 23-08-2005
Media : Bernama



Low-cost airline AirAsia Bhd expects mobile phones to be one of the main conduit for its business transactions in three years, said its chief executive officer Datuk Tony Fernandes Tuesday.

"It is easy to use and we will get better and better with it. In three years time, most transactions will be done through mobile phones," he said at the launching of mobile.airasia.com here Tuesday, by Minister of Science, Technology and Innovation Datuk Seri Jamaludin Jarjis.

The launch of mobile.airasia.com makes AirAsia as the first airline in the world to offer total comprehensive booking system, targeting mobile phones and wireless devices.

Fernandes recalled that many were sceptical of AirAsia when it used the internet as a marketing platform since it started operations several years ago.

However, at present 56 percent of the company's business is done through internet.

"Everyone stays connected through mobile phones. Once we start using, they will see how easy it is to do transactions through mobile phones," he added.

Fernandes said they would add more functionality to their mobile service.

"Right now we are only using credit card. But like on our website, we do transaction through Maybank2U, and a few other banks will be joining the system," he said.

He also said that it was possible for AirAsia to come out with a prepaid card concept to make purchasing air tickets easier.

Earlier, Jamaludin said utilising mobile phone as a business platform was something new in Malaysia. "We have not migrated to it for corporate initiatives," he said.

However, he said the country needed to move into the global scene of information communications technology (ICT) in a big way, adding that the future growth in Malaysia was in mobile-commerce (m-commerce).

"There is much potential for cellular access to internet," he said.

On the same note, Jamaludin also threw a challenge to ICT-related manufacturers to come out with an affordable device, in narrowing Malaysia's digital gap.

"I challenge the manufacturers to come out with a device which cost RM500," he said, adding that most communication devices were expensive and available to certain segment of the society in big cities only.

AirAsia: Wireless delivery system to boost business
Updated : 24-08-2005
Media : The Star
Story By : ELAINE BOEY



AIRASIA Bhd (AirAsia) expects its latest delivery channel, mobile.airasia.com กV a booking system designed for access via mobile phones or wireless devices กV to generate the bulk of its business in the next three years.

กงAs Malaysiaกฆs cellular penetration rate at 60% is much higher than its Internet penetration rate of 13%, AirAsiaกฆs new delivery channel can reach out to even more customers while reducing operating cost,กจ chief executive officer Tony Fernandes told a press conference in Petaling Jaya yesterday.

Currently, the low-fare airlineกฆs main delivery channel is its Internet booking system, which contributes 56% of its business.

According to Fernandes, the delivery channel is accessible by customers in any location around the world and would allow AirAsia to enter markets with a low Internet penetration rate such as Cambodia.

กงWe plan to expand to Cambodia soon. This country has a high cellular penetration rate, so we will be offering this service for customers there to book their flights,กจ he said, but added that issues such as payment methods would be considered later.

The system currently accepts credit cards but Fernandes added that more payment methods would be developed in future.

The company did not make a capital outlay to develop this system as it is based on an application service provider model, whereby AirAsia would pay a fee for every customer transaction.

Fernandes said AirAsia would invest in aggressive marketing efforts to promote this new delivery channel, much like the way it had encouraged customers to use the Internet to book its flights. He said operating cost was expected to drop as the technology used to develop this service is scaleable.

กงCompared with other delivery channels like call centres, this system will not require a lot of investment to scale upwards when an increasing number of customers start accessing it,กจ Fernandes said, adding that such cost-saving measures were necessary to mitigate high fuel prices.

He said oil prices were expected to increase further but the company was prepared to meet this challenge while keeping fares low by expanding its market.

AirAsia calls on MAS to work together
By Surin Murugiah, 29 Aug 2005 5:37 PM




AirAsia Bhd has called on Malaysian Airline System Bhd (MAS) not to enter into a price war with the low-cost carrier (LCC), but rather work together for mutual benefits.

AirAsia chief executive officer Datuk Tony Fernandes expressed dissatisfaction over the current level of cooperation between the two airlines.


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He said AirAsia had never asked to take over MAS’ domestic routes. He said MAS should not blame AirAsia for its losses as the national carrier was already running at a loss and making restructuring plans four years ago.

Fernandes said AirAsia had sought tax waiver, insurance incentives and the LCC terminal to be more competitive. “MAS and Transmile (Group Bhd) have tax incentives, we don’t.”

He was speaking at a press conference called by AirAsia to clarify its position in domestic operations in response to a statement made by MAS chairman Datuk Dr Munir Majid on Aug 26.

Munir was reported to have said: “Our position overall on the domestic segment is deregulate. The regulations mean a few things. We fly certain routes because we are told to do so, certain frequencies because we are told to do so; we charge a certain price because we are told to do so.

“Now when you say deregulate, don’t tell us which route we can fly, how often and how much we should charge. There are perhaps interests people want to protect... maybe one is to make sure that AirAsia does not fail.”


http://www.theedgedaily.com/cms/storage/images/com.tms.cms.image.Image_19909b90-cb73c03a-c5577c00-f389f17a/1/mas_logo_big.gif


In response, Fernandes said: “We have, since our inception, approached MAS to work together. Wouldn’t it better to have one premium airline and one LCC, giving passengers more options?”

“In many ways we see us as being positive to MAS. We are a three-hour airline, and can fly to all domestic routes, if necessary. By rationalising through cooperation, MAS can divert excess capacity to other destinations,” he said.

“You can have all the contracts and policies in the world, but if there is backbiting, we are not moving forward.”

He added that MAS’ Super Saver Fares was hurting the national carrier as well as the LCC, explaining that to operate at such levels would mean MAS losing revenue.

Fernandes added that if MAS were to do away with the Super Saver Fares, AirAsia’s pricing would improve.

AirAsia chairman Datuk Pahamin A Rajab said there was no one in particular who had a vested interest in protecting the LCC, explaining that as a public listed company it was incumbent upon it to strive for profitability.

“MAS’ problems were not caused by us. Everybody wants us to be successful and is happy when we do well. We get no more preferential treatment than what MAS gets,” he said.

“Even the then Prime Minister Tun Dr Mahathir Mohamad was happy that finally, more Malaysians could fly at low prices and thereby travel more.

Pahamin said it took good management to ensure the success of AirAsia, as not all LCCs were profitable. He also questioned as to how much business MAS had lost as a result of competition from the LCC, saying MAS should be transparent in giving the breakdown.

Fernandes said AirAsia would not be increasing its fuel surcharges for the time being, even though crude oil prices hit US$70 (RM263.88) per barrel yesterday.

He said many other airlines, unlike AirAsia, suffered because their business models were devised when oil prices were in the forty to fifty dollar ranges.

Malaysia AirAsia: July Passenger Traffic Up 35% On Yr
Updated : 02-09-2005
Media : Dow Jones
Story By : Carolyn Lim




(Dow Jones)--Malaysia's AirAsia Bhd. (5099.KU) Friday said passenger traffic in July grew a robust 35% on year due to contributions from its newly-acquired Indonesian associate.

AirAsia's 49%-owned PT AWAir associate carried 56,256 passengers in July, more than seven months after the Malaysian low-cost carrier bought a stake in the Indonesian airline.

AirAsia is Southeast Asia's biggest low-cost carrier in terms of fleet size, and its only publicly-listed one.

The airline's Malaysian operations showed a 25% on-year rise in passengers to 395,667 in July. Its 49%-owned Thai AirAsia associate reported a 16% rise in traffic to 148,953 passengers that month, AirAsia said in an e-mailed statement.

Total passenger traffic in July for the entire company stood at 600,876, AirAsia said.

The strong traffic rise isn't surprising as AirAsia more than doubled the number of passengers it carried in the year ended June 30 to 6.29 million, analysts said.

http://img.photobucket.com/albums/v730/Greg8000/MAS.jpg

AirAsia Bhd is expanding its wings to two new international routes - Chiang Mai in Thailand and Phnom Penh in Cambodia.

Daily services from KL International Airport to Chiang Mai will start on Oct 20, while daily flights to Phnom Penh will begin on Nov 1.

In a statement on Sept 27, AirAsia said to commemorate the expansion, 10,000 seats to each of the destinations would be offered at an introductory fare.

"We are thrilled with our latest expansion to Indo-China. AirAsia would be the first and only airline to offer direct flights between Kuala Lumpur and Chiang Mai.

"This destination marks the 4th major city in Thailand for AirAsia, after Bangkok, Phuket, and Hat Yai," said AirAsia chief executive officer Datuk Tony Fernandes.

"Thai AirAsia's upcoming venture into Vietnam on Oct 17 via flights to Hanoi from Bangkok, signals that the AirAsia Group has all but covered most of the major cities in Southeast Asia.

"We will continue to strive to add more points and connect more dots while offering low fares for a fraction of the costs, so that more people can fly," he said.

AirAsia keen on Indon flights from Malacca
Updated : 28-10-2005
Media : The Star
Story By : Lee Yuk Peng and Christina Tan in Malacca



AirAsia is keen to fly to Indonesia from the Batu Berendam Airport once the expansion of its runway is completed for Boeing 737 and Airbus A320 aircraft to land.

Currently, the runway was too short for big aircraft and expansion work costing RM120mil was scheduled to start in the first quarter of next year, Transport Minister Datuk Seri Chan Kong Choy said.

The expansion project was expected to be completed in two years, he added.

AirAsia Bhd CEO Datuk Tony Fernandes said the company would be interested in flying from Malacca to several destinations in Indonesia, but he did not specify the destinations.

Fernandes said AirAsia was now focused on the Asean and China routes.

He said AirAsia had also received landing rights in Cambodia, but had yet to fly to the country.

Both Chan and Fernandes were at the countdown ceremony of the delivery of 100 A320 Airbus aircraft to AirAsia at Composites Technology Research Malaysia (CTRM), a wholly-owned subsidiary of Ministry of Finance Inc, which manufactures parts for A320's wing panels.

'The A320s will mark a new chapter for AirAsia, as our operations will have one of the most modern and sophisticated aircraft in our service and we are the youngest airline fleet in Asia,' said Fernandes.

Last December, AirAsia signed a deal with Airbus for the purchase of 100 A320, which would be delivered in the next five years, beginning this December.

CTRM's participation in the Airbus 320 programme started in 2001.

In July 14 last year, it was awarded an extension for the A320 contract, worth RM800mil, for a five-year period from 2006 to 2010.

All AirAsia passengers travelling over the weekend and during the back to back Deepavali and Hari Raya holidays are advised to arrive at the KL International Airport as early as 3 hours before thier flights, to avoid missing a flight or connections, due to long queues at the check-in counters and congestion at immigration during the “balik kampung rush”.

AirAsia check-in counters open three hours before the scheduled departure time for International sectors and two hours for domestic.

Check-in counters will be closed 45 minutes prior to a flight’s scheduled departure.

Meanwhile, for the festive season, AirAsia has added an extra flight from Kuala Lumpur to Surabaya to meet demands. The extra flight is applicable between 20th–31st October.

AirAsia notes that many of its flights are already sold out as there is a huge exodus of people heading home during the festivities.

Nevertheless, due to AirAsia's increases in capacity and frequency of domestic flights, the airline still has some seats available for last-minute travellers.

cool