AirAsia plans strong growth in Southeast Asia with new A320 jets
AirAsia plans strong growth in Southeast Asia with new A320 jets
Carolyn Lim, Associate Press, Kuala Lumpur
Malaysia's AirAsia, the No. 1 budget airline in Southeast Asia
by revenue, plans to rapidly expand services in the region next
year as it takes delivery of new Airbus A320 jets, chief
executive Tony Fernandes says.
The airline has ordered 60 of the 182-seater A320s with the
option to buy another 40. It took delivery of its first A320
earlier this month, with the rest to be delivered over five
years.
AirAsia has grown rapidly in recent years, tempting many
first-time and budget air travelers in the region with cheap
seats to popular destinations throughout Asia. The purchase of
the new jets would make the upstart airline the region's largest
budget carrier by fleet size.
Fernandes, a former record industry executive, said in a
recent interview with Dow Jones Newswires that the new A320s will
allow the Malaysian airline to overcome capacity constrains and
focus on developing a strong regional network to stay above
growing competition, including Singapore Airlines spinoff Tiger
Air and Thai Airways' Nok Air.
By June 2006, AirAsia's fleet will grow to 41 planes including
seven A320s, up from 35 now, allowing it to beef up the
operations of its Thai and Indonesian affiliates, he said.
"Thailand's domestic (routes) for example are doing well, so
we're pumping that up," Fernandes said. The company's 49 percent-
owned Indonesia AirAsia affiliate also seeks to double passenger
traffic to 1.3-1.4 million next year, he said.
"The inter-ASEAN market is where our focus is going to be," he
added.
In 2006, AirAsia plans to fly from Kuala Lumpur to Ho Chi Minh
City, Vietnam and to Myanmar and Laos. Those would be added to
new routes to Indonesia's Balikpapan and Solo, and Cambodia's
Siem Reap that will be launched late December to early January.
Fernandes said AirAsia will also explore new destinations to
China from Thailand and Malaysia's Kota Kinabalu on Borneo
island. Its 49 percent-owned Thai AirAsia associate now flies to
southern China's Xiamen from Bangkok.
Apart from regional expansion, he said AirAsia is also ready
to expand within Malaysia by taking over any domestic routes that
will be discarded by loss-making national carrier Malaysian
Airline.
The two rivals are in talks, at the government's behest, about
the possibility of sharing domestic routes as part of plans to
help the flag carrier return to profit.
"I'm optimistic the restructuring of (Malaysian Airline)
domestic network is on the cards," Fernandes said. "If we can
take one chunk of network off their hands, they can focus (on
medium- to long-haul routes)."
Relinquishing part of its loss-making domestic routes to
AirAsia will also allow Malaysian Airline to consolidate its
fleet and boost its efficiency, he added.