Monday, August 23, 2010

AirAsia to Increase KL - Brunei Flight; Promo Fares from RM29

14 July 2010

AirAsia is to increase its frequency to twice daily on the route between Kuala Lumpur and Brunei from 25 August 2010.

To celebrate, AirAsia is offering all-in-fares from as low as RM29 one way for travel between 25 August 2010 and 8 May 2011. Travellers can book the special fare between 14 and 25 July 2010.

Kathleen Tan, Regional Head of Commercial, AirAsia said, “Increasing the frequency for flights to Brunei reiterates our commitment to enhance connectivity in the ASEAN region and to continue in our efforts of increasing traffic, promoting tourism, boosting trade and stimulating the growth of the traveling market between the two countries and around the region. The introduction of this additional morning flight to Brunei will enable business travelers to have the convenience of a day trip to Brunei for meetings and vice versa, thus fuelling the economy expansion of both Brunei and Malaysia and increasing foreign direct investments (FDI). Places of interest in Brunei such as The Royal Regalia Building, Jerudong Park Playground and Jame’ Asr Hassanil Bolkiah mosque will continue to draw in visitors, complemented by greater connectivity via AirAsia.”

AirAsia also flies daily to Brunei from Kota Kinabalu, Sabah.

AirAsia completes New Skies

11 July 2010

PETALING JAYA: AirAsia has completed the implementation of its new reservation system, New Skies.

The public can now carry out online booking through, as well as purchases through AirAsia sales offices, counters and the call centre, it said in a statement yesterday.

“All check-in services via the web, mobile and kiosks at the airport are functioning normally along with self-manage options online,” it said.

Among the new features included in the system is the Low Fare Finder where guests will have the convenience of viewing the lowest fare available according to their destination and date of travel.

Guests can also book seats for multi-cities in one transaction now.

AirAsia regional head of commercial Kathleen Tan said guests could look forward to greater savings with the new and more efficient system.

The Star

Air Asia and Lotus Racing partnership takes off

10 June 2010

AirAsia X officially announced a partnership with Lotus Racing, during the world famous British Grand Prix held at the home of British Motor Racing, Silverstone from 9 – 11 July.

AirAsia X CEO, Azran Osman-Rani and Lotus Racing CEO, Riad Asmat were on hand for the photo call at the Lotus Racing garage along with drivers Jarno Trulli and Heikki Kovalainen. Next to them was the Lotus Racing T127 displaying the freshly placed AirAsia logos on the car.
This announcement is very timely, given that AirAsia X flies directly to a number of destinations where races take place in the current Formula 1™ calendar such as the UK (via Stansted), Melbourne, Malaysia and Shanghai (via Hangzhou). Soon, Korea and Japan can be added to the list as the destinations are soon to be a part of the airline’s rapid growth.

Commenting on the partnership, Azran states, "Teaming up with Lotus Racing is an exciting step for AirAsia X. We admire Lotus Racing as a team which always strives for excellence, a trait similar to that of AirAsia X. Furthermore, as we expand our route network, it is essential that we build our global platform, and a great way to do so is via involvement in Formula One™. Particularly in our upcoming markets of Korea and Japan later this year, and France in early 2011, all of which host legs on the Formula One™ calendar.

“There were people who once doubted AirAsia X’s low cost long haul model, questioning whether it could survive in the current global travel market. We proved them wrong by becoming one of the best in the world! Lotus Racing too had their fair share of skepticism. No one thought the team could even make it to the grid in such a short period of time, let alone be worthy contenders on the track. But they silenced the critics not only by producing the cars on time for the race season, but also by becoming serious contenders in the competition. There’s a lot that we can learn from each other, and we look forward to this relationship with Lotus Racing, taking AirAsia X further into the realms of sports sponsorship,” Azran said.

Riad Asmat, Lotus Racing CEO, added his thoughts, saying: “We are extremely proud to welcome AirAsia X into the Lotus Racing family and are very excited about working together in partnership over the coming seasons. We are both growing fast, and the natural synergies between our two companies will provide us with many very exciting opportunities for Lotus Racing fans and AirAsia X passengers alike – frankly, we can’t wait to get started!”

Partnerships such as with the UK British MotoGP in June (the inaugural AirAsia British Grand Prix), also held at Silverstone, is another example of how powerful sports sponsorships can be as both branding and commercial tools for AirAsia.

AirAsia X's relationship with sports sponsorship began in 2009 with the announcement of being 'Proud Sponsors' of the Oakland Raiders, one of the most prolific teams in the National Football League (NFL) in the United States. The airline also sponsors the Gold Coast Airport Marathon which took place earlier this month, with CEO Azran leading a team of 20 staff runners, as well as providing sponsorship to two runners from Cambodia and Singapore in a bid to enhance the accessibility of Australia to all ASEAN communities through use of their sister airline, low-cost short-haul AirAsia.

Sports sponsorship is very important to AirAsia and AirAsia X, being the most homogeneous mass market which unites countless communities. Through sports sponsorship, AirAsia and AirAsia X is able to not only fulfill the larger vision of the airline by making dreams come true, but also to establish its brand’s equity value - a significant part of its branding effort, enabling AirAsia to become a household brand.

AirAsia to launch new booking system on Sunday

08 July 2010

PETALING JAYA: AirAsia Bhd that has invested RM10mil for its new booking system, will see the increase of its booking capacity and more creative marketing promotions post-implementation of the new system effective July 11.

Its regional head of commercial Kathleen Tan said the new system would allow the airlines to book up to almost a million segments a day against the current capability of 480,000 segments a day or 20,000 per hour. A segment constitutes of a booking of one route for instance Kuala Lumpur-Bangkok.

“Commercially, the new system will allow us to do creative marketing for different types of targeted customers such as promotions for senior citizens, buy one free one, multi currency services and free seat log in during normal hours,” she told StarBiz.

AIRASIA BHD REGIONAL HEAD OF COMMERCIAL KATHLEEN TAN: "The new booking system will allow us to do creative marketing."

Presently, Tan added that all booking were done in Malaysian ringgit and free seat log was normally done at midnight.

Apart from innovative sales and marketing campaigns as well as product and service offerings tailored to guests’ preferences, the new system will also enhance self-service facilities, including direct access to their credit shell accounts. The new system will be available starting 6pm (local time) on July 11.

By Sharidan M.Ali

The Star

Sunday, August 22, 2010

AirAsia to put in place new booking system

07 July 2010

Current system to be shut down for three days

KUALA LUMPUR: AirAsia's current booking system will be shut down from Friday to Sunday to allow a new, state-of-the-art system to be put in place.

The new system will be available from 6pm, Sunday, and is touted to be a huge improvement over the current booking system, allowing up to one million bookings daily.

"AirAsia's investment in technology is part of its commitment to give the best services to its guests. We have managed to stay ahead of the pack by smartly using advanced technology to enhance our products and services, and to meet the needs of today's tech-savvy air travelers," said AirAsia Regional Head of Commercial Kathleen Tan in a media statement Wednesday.

"The new and improved system will spell for AirAsia's guests countless benefits, including savings that will come as a result of the more efficient operational processes created by the new system," she added.

As part of the system implementation process, AirAsia's booking services will be temporarily unavailable from 1pm Friday to 6pm Sunday. The airline has notified its customers about the new system implementation.

While AirAsia implements its new system, passenger will not be able to book seats online, at AirAsia sales offices and counters, and through the call centre. They also will not be able to self check in – through the web, by mobile and at the kiosks – or self-manage their booking online. AirAsia will only be accepting cash for purchase of any ancillary product at the check-in counters, including excess baggage fees, during this period.

During the three days, AirAsia passengers will be manually checked in by the airline's staff at the airport check-in counters. Travellers are advised to check in at least three hours before departure to avoid missing their flights.

Hotel bookings and reservations for tours and activities on will remain available throughout the AirAsia system upgrade.

For regular updates, check, and

The Star

Thai Airways, AirAsia and Air China stocks surge

07 July 2010

Thai Airways and Thai AirAsia’s parent, AirAsia Bhd, gained considerable ground again yesterday, rising by 6.5% and 5.6%, respectively.

See related report: Thai Airways gains as tourism outlook improves

Air China upgraded, ANA benefits from Shanghai Expo

Air China advanced 4.1% yesterday on the same day Daiwa lifted its target price to HKD10.40, with an unchanged “Outperform" rating, noting the airline will benefit from an “aggressive fare increase”. The carrier is raising premium fares for 43 domestic routes from 15-Jul-2010.

Meanwhile, All Nippon Airways (ANA) stated its international passenger numbers surged 29.1% to 362,066 in May-2010, citing last year’s influenza outbreak (which depressed May-2009 figures) and strong demand for China-bound traffic amid the Shanghai World Expo. The number of ANA passengers to Asian destinations surged 35.4%, while US numbers rose 28.6%.

See CAPA Hot Issue on Traffic & Capacity

Asia Pacific selected airlines daily share price movements (% change): 06-Jul-2010

Source: Centre for Asia Pacific Aviation, Reuters & Financial Times

AirAsia announces launch of services to Hyderabad

04 July 2010

New Delhi AirAsia announced the launch of services from Hyderabad from July 20, 2010.

The launch is also supplemented by an exclusive offer for the local market that provides seats for an amazing low fare.

Talking about the new service, Jasmine Lee Sze Inn, Head of Commercial, AirAsia said, “We are glad to add yet another chapter to our success story in India

. As a gesture of gratification, we have introduced a special limited period offer for the local market here.”

“The service between Kuala Lumpur and Hyderabad has a lot of significance considering large amount of outbound travelers to Malaysia from this region.”, Jasmine Lee Sze Inn added.

AirAsia started their operations in India in the year 2009 with launching services to Trichy and in a very short span, they have extended their operations to Trivandrum, Kochi, Chennai, Kolkata, Mumbai and Bangalore. Hyderabad will be their 8th destination in the country which will be followed by the launch of services in the national capital in early August. AirAsia is committed to providing the best services at low fares. They have also been selected as the World’s Best Low-Cost Airline for two consecutive years by Skytrax in their annual World Airline Survey for providing the best services .

Guests flying on this new Kuala Lumpur – Hyderabad route will have the chance to experience the comfortability on the brand new A320 aircraft which is renowned for its reliability, unparalleled comfort and efficiency. This development is set to distinguish the world’s most successful low-cost airline as a distinctive leader in the market, further bolstering the brand as the advocates of innovation and excellence.

AirAsia’s operations are anchored in its mission to democratise travel, encapsulated in its tagline “Now Everyone Can Fly”. AirAsia’s vast route network in Asia and beyond offers great network and connectivity to the frequent fliers from the city of Hyderabad. They fly to over 70 destinations which stretches across 132 routes servicing a network stretching across all ASEAN countries like China, India, Bangladesh, Sri Lanka and Australia.

Air China stepping up domestic capacity with order for 20 B737-800s

28 June 2010

Air China's shares closed steady on Friday after it agreed to purchase 20 new B737-800s to meet rising demand. Air China stated the aircraft would be delivered between 2013 and 2015 and would “strengthen the fleet capacity of the company with an increase of approximately 5%”. The carrier added the transaction would “reinforce the company's market share in the domestic market, and will also increase frequency of flights for a number of domestic and neighbouring international routes."

China Southern Airlines, China Eastern Airlines and Hainan Airlines fell 2.7%, 1.7% and 1.5%, respectively.

See related report: China’s second tier airports: It’s where the action is!

Elsewhere, Asia Pacific airline stocks were mostly lower on Friday, with Skymark, Malaysia Airlines, Air New Zealand and AirAsia all falling by 2-3%.

Kingfisher gained 2.1% as the airline stated future oneworld partner, Finnair is looking to partner with the Indian carrier for sales to more Indian destinations, such as Mumbai. Finnair suspended Helsinki-Mumbai service in Apr-2008, but operates daily to Delhi.

Asia Pacific selected airlines daily share price movements (% change): 25-Jun-2010

Source: Centre for Asia Pacific Aviation & Reuters

Does it matter where AirAsiaX lists?

26 June 2010

Yes, but the full answer may not be what AirAsiaX or you think it is

THERE is this perception that you get more value for a company depending on where you list it. Investment bankers, especially foreign ones, have sent out sorties to entice Malaysian companies to list overseas through this perverse logic that listing in a more developed and active market will get you better value.

But we will show that such a premise is not true. Those who fall for that fallacious argument do so at their own peril. They not only will NOT get extra value, they are likely to lose a lot of goodwill, and I am not talking accounting goodwill here.

Let’s take the example of AirAsiaX. Both its CEO Azran Osman-Rani and its prime mover and entrepreneur behind it, Datuk Seri Tony Fernandes, have talked about listing the infant airline overseas.

Analysts have blithely alluded to AirAsiaX obtaining better liquidity and valuations if they are listed overseas in markets such as London, Hong Kong or New York but they don’t explain how that is possible.

If they are to be believed, Bursa Malaysia is a market of little or no consequence, the markets here are illiquid, it is not open to investment by foreign funds, world markets are terribly imperfect and valuations here are generally lower than valuations overseas. But all of these are patently untrue.

Malaysia’s bourse is a small one but not insignificant and it has foreign funds invested in it. Some companies are majority owned by foreign funds and investors, and AirAsia – the low cost short-haul airline unlike its cousin AirAsiaX which is long-haul – is probably one of them.

In a world which has become virtually borderless, any fund in the world can invest anywhere and in any listed company. Bursa Malaysia is as open as any other market in the world. So there is no question that any fund will not have access to AirAsiaX if it were listed here. There is no question of liquidity.

Markets, because of their openness, reflect the value of companies listed on them. It does not matter where the companies are listed, their value depends entirely on their operations, future prospects and how they are perceived by the investing public.

In fact, studies have shown that companies better reflect their value when they are listed on their home markets simply because they are better understood and known there, more analysts are likely to follow them and there is likely to be greater interest in the companies if they are good.

Questions: Is AirAsiaX likely to be known better if it is listed in Malaysia or in New York or London or Hong Kong or even Singapore? Is anyone going to think that AirAsia X is English if it is listed in London?

No matter where AirAsiaX is listed, any analyst worth his salt, and in this day and age the better ones have to be, will look at where its operations are, how it is run and its prospects. Then the risk is priced in accordingly. You cannot change the risk of a company by switching its listing, you have to switch its operations.

And do overseas markets have better valuations? This question is irrelevant because as we have pointed out it is the business that counts and not where it is listed but let’s answer it anyway.

The FTSE Bursa Malaysia KLCI, the key Malaysian index, trades at a P/E multiple (total market price divided by net earnings, a measure of value. The higher the P/E, the higher the valuation.) of over 17 times according to Bloomberg data. That’s higher than London’s FTSE 100 index at 13.8X, New York’s Dow Jones (14.2X), Hong Kong’s Hang Seng (15X), and Singapore Straits Times Index (13.3X).

Going by the perverse logic given by some of those roving investment bankers intent on getting AirAsiaX listed overseas, Malaysia gives the best valuation of any of these key markets, which means the company should be listed here!

Surely smart people like Azran and Fernandes are not going to be taken in by these false claims that better value is obtained by listing overseas. That means they have something else in mind when they talk about overseas listing.

If I have to have to speculate, I would say it’s a bargaining process – trying to get the best deal for AirAsiaX to list here. And the people at both AirAsia and AirAsiaX drive a very hard bargain indeed. But sometimes things can boomerang – you may get more than you bargained for.

I am willing to bet that they will NOT make the move to list overseas simply because the best value (loosely speaking that is), and importantly the best goodwill from their customers and the Government, will be obtained by listing here.

Yes, it matters where AirAsiaX lists. It will stand to gain more overall by listing here in Kuala Lumpur than anywhere else.

l Managing editor P Gunasegaram says a company creates value by, well, creating value and showing that it has. What better place to do that if not at home?

By P Gunasegaram

The Star

Malaysia AirAsia Considering Dividend Payout

24 June 2010

Malaysian budget carrier AirAsia is looking into the possibility of paying dividends, its chief executive said on Thursday.

AirAsia has not had a dividend policy since it was listed on the Malaysian stock exchange in 2004. It previously said it wants to reinvest profits for future capital requirements.

"The board is actively looking at it... we are in a much better position (than last year) to be considering a dividend," Tony Fernandes told reporters after the airline's shareholders meeting.

No decision has been made on the dividend and Fernandes declined to give a timeline or guidance.

AirAsia also plans to offer 30 percent of its Indonesian and Thai units to the public in listings in their respective stock exchanges next year, said Fernandes.

AirAsia, Asia's biggest budget carrier by fleet size, is trading at some of the lowest multiples in the industry as its high debt keeps the stock under pressure, analysts said.

Citigroup estimates that AirAsia is trading at just 6.2 times its expected 2010 earnings, one of the lowest ratios of any listed airline. That is well below its P/E ratio projection of 13.6 for rival Tiger Airways and 11.4 for Virgin Blue.

AirAsia is also one of the most indebted carriers with Morgan Stanley estimating the company's net debt to equity ratio at 249 percent at the end of 2010 and Citigroup predicting 255 percent.

Fernandes said he expects the carrier's gearing to continue falling. He did not elaborate.


AirAsia X becomes first LCC to offer low-cost flatbed seats, as expansion rolls on

24 June 2010

AirAsia X becomes first LCC to offer low-cost flatbed seats, as expansion rolls on
AirAsia X CEO, Azran Osman-Rani

AirAsia X has become the first LCC to offer flatbed seats on its long-haul route network, with the low-cost long-haul carrier claiming that its product "combines the comfort of premium travel with the affordability of no-frills flying". The new Premium FlatBed and economy class seating product was installed this month on its A340 aircraft operating on the Kuala Lumpur-London sector, ahead of a fleet-wide roll out.

AirAsia X premium product

London Stansted Commercial and Development Director, Nick Barton, called the product the "next evolution" of low-cost flying, adding that it would revolutionise air travel "between Europe, Asia and beyond".

To have highest-density configuration on both A340 and A330 equipment in the region

The new configuration for the AirAsia X A340 is 18 flatbed seats (30 currently) and 309 economy seats (256 currently), for a total of 327 seats (286 currently), which will make it the highest-density A340 configuration in the region (compared to mid-range at present). The carrier also upgraded its economy class seating, to feature reclineable seats at 31” pitch equipped with adjustable headrests. The airline also decided to move away from traditional black leather to a mix of red and grey.

Asia Pacific carriers’ A340 seating configurations: Jun-2010


Aircraft Type


In Service


China Eastern Airlines





SriLankan Airlines





SriLankan Airlines





Air Tahiti Nui





Air China





China Eastern Airlines





AirAsia X





Hainan Airlines





Safi Airways





Cathay Pacific





China Airlines





Thai Airways





Philippine Airlines





Thai Airways





Singapore Airlines








Refurbishment process to be competed by Jul-2011

AirAsia X is currently upgrading its entire fleet with the new seats in stages for all long-haul flights to Melbourne, Gold Coast, Perth, Taipei, Hangzhou, Tianjin, Chengdu, London, Mumbai and New Delhi.

The refurbishment process is expected to be completed by Jul-2011 and will allow AirAsia X’s A330 to have a seat configuration of 12 flatbed premium seats (28 currently) and 365 economy seats (355 currently), for a total of 377 seats (compared to 383 currently on five of its six A330-300s in service). With the new configuration, AirAsia X will remain the highest-density A330 operator in the region, giving it a 20% unit cost advantage over its nearest rival, Vietnam Airlines on seating density alone. Add in higher utilisation rates and the advantage could be 30-50% over rivals flying the same aircraft type.

Centre for Asia Pacific Aviation

AirAsia X unveils low-cost flatbed seats

23 June 2010

Good news for long-haul travellers who fly on a budget – AirAsia X has just become the first low-cost carrier in the world to offer flatbed seats on its long-haul route network.

The airline, which runs daily flights to Kuala Lumpur from London Stansted Airport , claims that its product combines the comfort of premium travel with the affordability of no-frills flying.

With fares starting from £649 one-way its new offering will be out of reach for many, but for those who simply want a comfy seat without the bells-and-whistles it could be perfect.

Seasoned business travellers will immediately pick out the low-cost elements of the new product, which lacks backseat TVs and includes a meagre 15kg checked baggage allowance.

But AirAsia X is right to hail its product as revolutionary. The £649 price-tag is a fraction of what legacy carriers at Heathrow charge for similar comfort, and the seat's ergonomic design allowed our 6ft 3in correspondent to lie outstretched in the fully-reclined position without impediment.

Universal power sockets, adjustable headrests and privacy screens add to the air of luxury premium travel, though it's the groundbreaking flatbed option that puts this seat in a league of its own.

Speaking at the official launch, AirAsia X chief executive Azran Osman-Rani commented: "As frequent flyers ourselves, we understand the great need for comfort especially for long-haul flights. Both business and leisure travellers can now enjoy greater low-fare connectivity than ever before."

Nick Barton, Stansted's commercial and development director, called the product the "next evolution" of low-cost flying and said it would revolutionise air travel "between Europe, Asia and beyond".

AirAsia X is increasing its London Stansted to Kuala Lumpur route to nine weekly flights in November. The airline offers onward connections to destinations such as Australia, Thailand and China via its parent brand AirAsia, which operates more than 400 daily flights in the region.

AirAsia offers extra low fares to India

23 June 2010

PETALING JAYA: AirAsia will be offering extra low fares to eight India destinations from as low as RM169 (all-in fares) one way from Wednesday to next Wednesday.

The travel period for the promotion is from July 1 to Sept 24 this year.

The destinations included are Kuala Lumpur to Tiruchirappalli; KL to Kochi; KL to Kolkata; KL to Trivandrum and Penang to Chennai.

Other destinations are KL to Bangalore; KL to Mumbai; KL to New Delhi.

AirAsia regional head of commercial Kathleen Tan said, with the promotion, the airlines hoped to promote Malaysia and bring in more Indian nationals into the country in line with Tourism Malaysia’s target of 650,000 Indian tourists for this year.

“We are delighted to see the increase of our load for the Indian sectors and announce this promotional offer so that more can travel and explore the myriad attractions that India has to offer.

“Furthermore, our guests who utilise our Kuala Lumpur and Penang hubs can have more options for their travel plans,” she said.

She said passengers could also complement their travel plans with online hotel deals and tour packages via at www., where they could choose tours, activities and holiday lodgings from over 70,000 hotels worldwide including ground transfers and personalised activities.

by Ng Cheng Yee

The Star

Low-cost hotel to offer London rooms for a penny

22 June 2010

Tune Hotels, the low-cost hotel chain from budget airline AirAsia, announced June 21 that it is to celebrate the opening of its new hotel in London with rooms from one penny.

The hotel, which will be Tune Hotels' first expansion outside of Asia, is set to open in Westminster, London this August.

To celebrate, Tune Hotels is offering rooms from one penny on certain days from June 29, bookable online at the group's website,

There will be 1,000 rooms available in the promotion, to be released on "TuneDays" through June and July.

Following the low-cost model of its sister airline, Tune Hotels claims to offer the basics - a bed, a shower and security - but charge for the extras normally provided in hotels.

Eight hotels under the Tune Hotels brand are currently in operation in Malaysia and Indonesia from RM 8 (€2) per night, and the chain says that its prices in London will average £35 (€41) per night but promotional rooms will be available from £9 (€10.77).

The brand is aiming for 100 hotels in operation by 2015 (including a further 15 across Greater London), which will see it compete directly with EasyHotel, the global brand associated with low-cost airline EasyJet.

EasyHotel recently opened its 12th property in Berlin, offering an opening deal of €10 per night for a room in the Hackescher Markt.


Air Asia X to more than triple revenue in 5 yrs

16 June 2010

AirAsia X, the Malaysian long-haul budget airline, aims to more than triple revenue in five years as it adds more planes and destinations, Chief Executive Officer Azran Osman Rani said.

The airline, which has a fleet of eight Airbus SAS planes currently, plans to increase that to 20 by 2015, Azran said in a phone interview today. AirAsia X posted a profit of 87 million ringgit ($27 million) in 2009 on revenue of 720 million ringgit.

The carrier is also planning to fly to new destinations such as South Korea and Japan this year, after taking delivery of three more planes, he said.

- Bloomberg

Business Times

AirAsia bags world's best cargo industry newcomer award

15 June 2010

is the best newcomer in the air cargo industry!

AirAsia bagged the Air Cargo Industry Newcomer of the Year Award 2010 in the ACW World Air Cargo Awards held Wednesday in Shanghai. AirAsia is the first low-cost airline to win the award.

The award was given by Air Cargo Week, a respected UK-based publisher of a weekly newspaper for the air cargo industry. The awarding ceremony was held during the Air Cargo China 2010 global exhibition and conference, which attracted air cargo professionals from around the world.

AirAsia won the award after emerging first in a global survey that polled industry peers and shippers.

Sathis Manoharen, Regional Head of Cargo, AirAsia, said, "This award signifies the growing confidence and belief in the AirAsia cargo product and service. Having industry peers and shippers giving us this recognition is certainly a boost to us as we steadily grow our footprint in the cargo market. With the recent introduction of the web-based cargo booking and tracing system, we hope to grow from strength to strength in our service offering and continue to provide value opportunities to our clients."

AirAsia identifies cargo as a major revenue-generating channel. It is optimizing the potential of its otherwise empty belly space to bring in cash by offering cargo services at rates considerably lower than its competitors' and by tapping AirAsia's extensive network and flight frequencies to reach more destinations and achieve faster delivery time.

AirAsia is strengthening cargo operations in part to protect its bottom line against fluctuations in fuel prices.

Asia's largest low-cost carrier has been tying up with more cargo agents and large export-import firms in the markets that AirAsia flies to. It is also reaching markets beyond its current route network through other airlines with which AirAsia has special pro-rate agreements.? These major airlines extend AirAsia's reach to more cities in East Asia, the Middle East and Africa.

AirAsia's most popular cargo are perishables, machine and car parts, electronics, shoes and apparels.


Vietjet Air still grounded

14 June 2010

VietNamNet Bridge – The private airline Vietjet Air will be unable to take off as promised because it still has not completed all the necessary procedures. The airline needs to find another name for the joint venture Vietjet Air – Air Asia that can be accepted.

Vietjet Air has contacted Civil Aviation Administration of Vietnam (CAAV), requesting that it allow them to delay operation off until October 2010, because the airline needs some more time to settle problems relating to its sale, brand, personnel and fleet.

Vietjet Air previously planned to provide commercial flights under the name “Vietjet-AirAsia” after it sold 30 percent of the company to AirAsia. The name, however, is a matter of controversy. Many aviation experts claim that the name may lead to misunderstandings and travelers may mistake the air carrier for Air Asia. They also believe that the name does not reveal that this is a Vietnamese airline.

The case is reminiscent of the Jetstar Pacific case, in which the airline was told not to use the orange star and Jet logo because it could be mistaken for an Australian airline.

CAAV told Vietjet Air to rethink its brand and not to use logos and brands that might create misunderstandings.

A representative of Vietjet Air admitted to VnExpress that the biggest problem is branding. The air carrier has hired consultants to design a logo and brand, and this will take time.

“This is the main reason why we still cannot take off as planned,” he observed.

The Vietjet Air agreement to sell 30 percent to a foreign airline also raised protests. Two weeks after Vietjet Air announced the sale, Vietnam Airlines, the national flag air carrier asked the Government not to approve the deal.

According to Vietnam Airlines, AirAsia’s investment in Vietjet Air should be seen as a threat to Vietnam’s market.

According to Vietnam Airlines, with 30 percent in Vietjet Air, AirAsia will be able to join the board of directors and manage the airline anyway it sees fit.

Vietjet Air is the first private airline granted a license (in December 2007). Its two main shareholders are Sovico Group and HD Bank. The airline initially planned to begin commercial flights in late 2008. However, the airline decided to delay for four months, because fuel prices sharply increased.

In March 2009, Vietjet Air again decided on a delay to October, and then agreed to another delay for five more months, until May 2010. Due to branding issues, the airline initially reported that it would not begin operation until August. In the latest news, the airline will now not open prior to October 2010.

To date, three private airlines have been licensed to operate in Vietnam, including Vietjet Air, Indochina Airlines and Mekong Aviation. Of these three, Indochina Airlines has gradually disappeared after one year of operation.

The third private airline, Mekong Aviation also plans to provide flights in 2010. The air carrier will have 10 aircrafts to fly domestic routes, including Hanoi-Phu Quoc, Hanoi-Nha Trang, Hanoi-Can Tho.

According to CAAV, by 2015, Vietnam will have 149 aircraft and provide 33 million seats.


AirAsia to launch KL - Myanmar Flights; Promotional Fares from RM 29

14 June 2010

AirAsia is to launch direct daily flights to the beautiful city of Yangon in Myanmar. The new route will commence services from 20 July 2010.

To celebrate the introduction of this new route, AirAsia is offering all-in-fares between Kuala Lumpur and Yangon from as low as RM29 (US$10) one way. Booking starts from today, 14 June 2010 until 20 June 2010, for travel between 20 July 2010 and 8 May 2011. Promotional seats are limited and available on a first-come, first-served basis. Terms and conditions apply.

AirAsia’s foray into South East Asia’s largest country, Myanmar, from its Kuala Lumpur hub completes the ten countries under the ASEAN (Association of South East Asian Nations) network. AirAsia already flies to Yangon from its Bangkok hub with daily flights.

Ms Kathleen Tan, Regional Head of Commercial AirAsia said, “Myanmar will see a big boost in their tourist entries with this new direct daily flight from Kuala Lumpur to Yangon, as our guests from Europe, China, India, Australia and around the ASEAN region utilizing our Kuala Lumpur hub now has a more affordable option to travel to Myanmar. AirAsia’s affordable fares will also enable the Burmese workforce in Malaysia to return home and visit their families more often. Avid travelers and backpackers looking for the Asian experience can now add Myanmar to their list, as AirAsia’s entry into this market offers greater connectivity options from our Kuala Lumpur hub at a much lower fare.”

The city of Yangon is home to mesmerising Buddhist pagodas of diverse architectural style and structures, such as the Swedagon Pagoda, the most sacred and honourable pagoda in Myanmar, made from eight tonnes of gold and adorned with precious gems like diamonds, rubies, sapphires and emeralds. Other must-see attractions in Yangon include the Sule Pagoda, Botahtaung Pagoda, the National Races Village, National Museum, War Memorial and Yangon Zoological Garden.

Myanmar’s southern uninterrupted coastline facing the Bay of Bengal and the Andaman Sea provides beach lovers with unspoilt beaches such as the breathtaking Ngapali, Ngwe Saung (Silver Beach) and Chaungta.

This new route will be serviced by Airbus A320 aircraft with a 180 passenger capacity

AirAsia X denies it may list in HK or US

10 June 2010

AirAsia X, a Malaysian long-haul budget carrier, denied a Star newspaper report it is considering selling shares on the Hong Kong or New York stock exchanges.

“We haven’t considered the destination. There’s no size of the floatation, no adviser has been hired yet,” chief executive officer Azran Osman Rani said in a phone interview today.

“We are not in a preparation mode for listing yet.”

-- Bloomberg

EVA Air, China Airlines fall, MAS and AirAsia gain

10 June 2010

Asia Pacific airline stocks were mixed again yesterday, with Taiwan’s EVA Air (-4.0%) and China Airlines (-3.5%) weaker despite EVA’s very strong May-2010 traffic report.

EVA Air’s passenger numbers rose 18% year-on-year last month to 552,587, while passenger load factor surged 11.2 ppts to 79.3% and passenger yield jumped 20.8% to USD 6.75 cents. Cargo volumes climbed 55.8% to 75,539 tonnes and cargo yield soared 46.2% to USD 25.65 cents.

Malaysia’s AirAsia (+4.7%) and Malaysia Airlines (+5.1%) closed higher ahead of today’s unveiling of the tenth Malaysia Plan by Prime Minister Datuk Seri Najib Tun Razak.

Elsewhere, Singapore Airlines, Qantas and Cathay Pacific fell 0.4%, 1.2% and 2.8%, respectively.

See the CAPA Hot Issue page on Asia Pacific Aviation.

Asia Pacific selected airlines daily share price movements (% change): 09-Jun-2010

Source: Centre for Asia Pacific Aviation & Reuters

AirAsia X listing under study

10 June 2010

Analysts say long-haul low-cost business model not yet proven

PETALING JAYA: While the listing of AirAsia X Sdn Bhd (AAX) is deemed necessary, some analysts are still studying the viability of its business model as the long-haul low-cost model has yet to chart an established flight path.

It is also on this note that they feel AAX’s listing will have minimal impact on AirAsia Bhd. Not everybody will sell their shares in a proven model such as AirAsia’s for AAX’s relatively new model.

“The success of budget airlines has always hinged on flights not exceeding four hours. Long-haul flights mean that margins will be thinner. Efficiency is also compromised with facilities for inflight entertainment. However, as AirAsia has continuously amazed the market, I won’t be surprised if it succeeds (with AAX),” said an aviation analyst.

An RHB analyst in his report said AAX’s use of wide-body aircraft with a seating capacity of about 400 (versus 180 seats for a narrow-body aircraft) meant it was also harder to fill the plane during off-peak periods.

Nonetheless, the listing is necessary as AAX has placed orders for 17 A330 and 10 A340 aircraft, which are scheduled to be delivered progressively in the next few years.

Without an appropriate equity portion in its balance sheet, it would be difficult for AAX to secure attractive financing for these aircraft, which will cost billions of ringgit.

This listing will also see AAX eventually taking over employment of its own pilots, cabin crew and ground staff, and maintaining its own commercial and marketing teams.

Last year, AAX paid AirAsia RM57mil for a host of airline services.

This will now stop, except for the continued use of the AirAsia brand, its website and the use of the AirAsia academy and training facility.

As no breakdown was provided for these charges, it is uncertain what each service costs. The loss of revenue to AirAsia will, however, be minimal.

On the timing of the initial public offering (IPO) by the second half of 2011, analysts said this suggested that the group would put in extra efforts to churn out better financial numbers to ensure the success of AAX’s listing.

“We believe the group will keep the good news flowing to attract investors’ attention,” said an aviation analyst.

While it is still uncertain how much AAX is planning to raise from the IPO exercise, the recent IPO of budget carrier Tiger Airways on the Singapore Exchange raised S$247.7mil (RM583.5mil). Tiger Airways shares were offered S$1.50 (RM3.53), which values the company at 12.6 times price earnings ratio of its March FY2011 earnings.

AirAsia’s IPO in 2004 raised RM863mil, with its stock priced at RM1.25 for institutional investors and RM1.16 for individual investors.

“On a historical basis, we expect the proceeds to be raised by AAX would be between RM500mil and RM900mil. We believe this would be sufficient for AAX to start on its aircraft expansion,” said an analyst from MIDF Research.

AirAsia presently has a 16% stake in AAX and an option to increase it to 30%. AAX’s other shareholders are Aero Ventures Sdn Bhd (48%), the Virgin Group (16%), Bahrain-based Manara Consortium (10%) and Japan-based Orix Corp (10%).

Aero Ventures is owned by Datuk Seri Tony Fernandes, Datuk Kamarudin Meranun, Datuk Kalimullah Hassan, Lim Kian Onn and former Air Canada chairman and CEO Robert Milton.

By Tee Lin Say

The Star

AirAsia forms Koolred

10 June 2010

AIRASIA Bhd has formed a new subsidiary called Koolred Sdn Bhd that will offer a premier travel social networking website to users.

Through the website, users can build their own communities and offer each other travel advice, support and share travel information.

The directors of Koolred presently are Phua Sheau Wei and Lau Kin Choy.

The company has an authorised share capital of RM100,000.

Business Times

AirAsia launching tax-only fares

08 June 2010

Budget carrier AirAsia X is offering return fares from Australia to the UK from under $240 as part of a 48-hour sale.

The tax-only fares apply on routes across the entire AirAsia X network covering Malaysia and beyond.

The booking period for 'The World’s Best Sale' promotion runs for 48 hours only from June 9 to 10 for travel between October 11 and November 14, 2010. The online sale starts at 2am EST Wednesday June 9, 12.01am WST.

AirAsia X says the sale celebrates it's being named the 2010 World’s Best Low Cost Airline in the annual World Airline Survey by Skytrax, for the second consecutive year.

Fares include London (Stansted) via Kuala Lumpur and back from the Gold Coast from $217, from Perth from $235 and from Melbourne from $240.

These total fares to London and back to Australia are available by purchasing one way sale fares in each direction from either Gold Coast, Perth or Melbourne to Kuala Lumpur, then from KL on to the UK.

From just $10 passengers can also fly one way from Kuala Lumpur to a range of other destinations including Hangzhou, Tianjin, Taipei, Mumbai and New Delhi.

“This is undoubtedly The World’s Best Sale from the World’s Best Low Cost Airline but it’s only for 48 hours so you’ll have to get in quick,” AirAsia General Manager Australia Darren Wright said.

“Guests will have to pay only the taxes on these seats, making flying to London and back just as cheap as, or even cheaper than, a return domestic flight at home."