AP Interview: AirAsia's Tony Fernandes flies high - with feet
AP Interview: AirAsia's Tony Fernandes flies high - with feet firmly on ground[ AP Photos KL104-106[ By VIJAY JOSHI= Associated Press Writer= KUALA LUMPUR, Malaysia (AP) -
Flying high -- with his feet firmly on the ground
Vijay Joshi Associated Press/Kuala Lumpur
Tony Fernandes is as no-frills as his airline.
AirAsia's boyish CEO with a ready grin dislikes suits and comes to work in T-shirt and baseball cap. He drives himself to office ("I just feel very odd sitting in the back of the car"), gets on AirAsia flights once a month to serve passengers drinks, and his speech is generously sprinkled with the catch-all "cool."
It is a style befitting the 41-year-old Malaysian businessman who became the poster child of Asian entrepreneurship after buying bankrupt AirAsia less than four years ago for 1 ringgit (25 U.S. cents) and turning it into the region's most profitable budget carrier now worth nearly US$1 billion.
The slightly chubby Fernandes even used to help load and unload baggage from planes until recently when he hurt his back heaving suitcases on a flight to Indonesia.
"On Indonesia flights they generally bring their house and their neighbor's house," Fernandes said with a chuckle in an interview at his cramped, windowless office at Kuala Lumpur International Airport.
Fernandes' character epitomizes the philosophy of AirAsia, the region's first no-frills airline that revolutionized air travel in Asia by breaking the stranglehold of national airlines and drastically reducing fares.
Much of the airline's success lies in its cost-cutting strategies: no free food, faster turnarounds at airports to save on parking fees, flight crews clean the planes, Internet reservations to eliminate booking offices and new, fuel-efficient aircraft.
The company's headquarters, an area smaller than a football field, is reached after a long walk across the tarmac, past idling jetliners and airport vehicles.
At the far end of the office is the Fernandes' cubbyhole, which consists of an old L-shaped desk, two chairs for visitors, a safe, two aircraft models, a notebook computer and a collection of baseball caps hanging on the wall behind him.
"I have the worst office in the world for a CEO of a billion- dollar company," said Fernandes, an ethnic Indian.
His dream of running an airline was sparked when as a boy his father told him he could not join his mother on a flight to Singapore because they couldn't afford two tickets.
"I didn't want to be a pilot or anything like that," he said.
"One thing that is consistent from 5 years old to now was that I wanted to own an airline that would make it affordable to fly." Three decades later, Fernandes owns an airline whose slogan is, "Now Everybody Can Fly."
Fernandes was educated in the United Kingdom in finance, and joined Virgin Group after graduating in 1987. He moved to Warner Music International in London in 1989, and appointed Warner Music Malaysia's Kuala Lumpur-based chief 1992 at age 28, the youngest person to hold that post.
A music buff -- he plays the keyboards and the drums -- Fernandes excelled, and Warner CD sales jumped. But Fernandes says relations with his superiors deteriorated after Time- Warner's merger with AOL. Office politics and egos began suffocating him, making him want to leave.
It was during this time that he saw a broadcast on TV about easyJet, a British budget carrier, and thought such a venture might work in Asia as well.
He got together three other investors, mortgaged his house, took out his savings and made a pitch for the badly managed, money-losing AirAsia, then owned by DRB-Hicom, one of Malaysia's biggest conglomerates.
Wasn't that a crazy idea, especially with a wife and two children to support?
"Yeah it was!" Fernandes says. "But I didn't want to sit there at 55 and say I should have done it. I don't mind failure. I have never been one to be scared of failure. But I hate having regrets."
Fernandes says it wasn't easy giving up the perks of the Warner job -- "fly first class everywhere, stay in the best hotels, dinner with Madonna, lunch with another artist." "But I was so, so fed up," he said. "Warner drove me to set up my own business."
Fernandes signed an agreement on Sept. 8, 2001, to buy AirAsia and its two planes and assume its 40 million ringgit (US$10.5 million) in debt.
Three days later, New York and Washington were hit by the terrorist attacks.
"Just as a I got home I saw (on TV) the second tower collapse," he said, referring to the World Trade Center. "And I am like, 'Christ, this is the last thing we need!"'
But AirAsia coasted through the crisis. It was profitable from the first day of operations in January 2002. Today, it has 1,600 employees and a fleet of 21 Boeing 737s, operating over 100 domestic and international daily flights in Malaysia, Thailand, Indonesia, Philippines, China and Macau.
And in a clear sign of Fernandes' ambitions, AirAsia has signed an agreement to buy 60 new Airbus A320s over the next five years for more than US$1.5 billion.
The company does not have a rigid hierarchy, evident in the way junior workers came into Fernandes' office to talk to him about operational matters during the interview.
"We trust our people. We give them a job to do and they got to do it," he said. "We develop talent. We never let talent down. We will never kill a spirit."
Fernandes says he has no intention of making AirAsia a full- service, long-haul airline. Instead, he wants to expand regionally, focusing on China.
He derives pleasure in proving wrong critics who had predicted AirAsia would go bust.
"If I drop dead tomorrow no one can take away the fact that if anyone here started a revolution in Asia, it was AirAsia. No one can take that away from us (even if) we go bankrupt tomorrow," he said.
"I think that's cool."
GetAP 1.00 -- SEP 11, 2005 07:38:30