AirAsia to have own airport

AirAsia announces plans for own airport outside Malaysian capital KUALA LUMPUR - BUDGET carrier AirAsia said on Thursday it will shift to its own US$460 million (S$681.4 million) airport outside Kuala Lumpur, and abandon its overcrowded terminal next to the main international airport.

The move has thrown into doubt the national airport operator's plans to build a new Low Cost Carrier Terminal next to Kuala Lumpur International Airport (KLIA), to replace the existing facility that opened in 2006.

'We believe in lowering our business costs, it is the key to our success,' AirAsia founder Tony Fernandes told a press conference.

'The new airport which will be known as KLIA East will provide more capacity for aircraft and passengers, and enable us to bring down fares,' he said, adding that costs could be lowered by 30 per cent.

Mr Fernandes rejected criticism that KLIA has more than enough capacity to handle AirAsia's growth plans, and that the sprawling city has no need for what would be its fourth airport.

'I think we know what we need, we are not silly,' he said. 'There is nothing here (at the old terminal) to add value to our passengers. Allow us to take our destiny in our own hands.' Mr Fernandes said the new airport would be exclusively for AirAsia, and designed to handle up to 30 million passengers annually. Construction could begin within six months with a completion date of March 2011.

The new airport would be linked by new train and road links, and be about 30 minutes' drive from the city centre - less than the journey to KLIA.

Malaysian conglomerate Sime Darby had said it has won government approval to begin the project, which is to be the centrepiece of its new development at Labu in Negri Sembilan state.

'We have a fantastic partner, it will enhance tourism. We will also have a theme park, it will be like Orlando airport where Disneyland is located,' Mr Fernandes said.

AirAsia has dramatically outgrown its rough-and-ready terminal adjoining KLIA, which has no rail links with the city or the main airport, and has become increasingly crowded and unpleasant for passengers.

The terminal was completed in just nine months, with a capacity for 10 million passengers and a provision for expansion to 15 million passengers.

The expansion of the current low-cost terminal is due to be completed by March, but by then AirAsia will already have exceeded its enlarged capacity with some 15.7 million passengers a year.

AirAsia Launches Regional Sale

AirAsia Launches Regional Sale

KUALA LUMPUR, Jan 5 -- AirAsia, Asia's pioneering low cost airline, has launched a regional sale offering airfares starting as low as RM9 excluding airport taxes, administration fees and applicable for one-way travel for domestic and international routes.

The low fares offered are available to all of its Asian destinations departing from its hub from Kuala Lumpur, Kota Kinabalu, Kuching, Johor, Bangkok, Jakarta and Bali, it said.

The sale will be from Jan 6-18 for travel from Feb 9 to June 30, this year, AirAsia said in a statement here Monday.

"With over 100 routes to choose from, we believe we cater to leisure and business travellers, giving them more choices and flexibility with our unbeatable low fares and extensive flight frequencies," its regional head of commercial, Kathleen Tan, said.

A closer look at the proposed KLIA East@Labu

THERE are some reservations over the proposed new terminal at KLIA East@Labu.

After all, there is already the KLIA and the LCCT.

But let’s look at the bigger picture.

The new terminal will allow AirAsia and AirAsia X to grow and strengthen Malaysia’s position as a global air transport hub.

It’s actually going to be an exciting project.

Let’s look at it with the full statistics.

Latest figures show that in 2008, KLIA attracted 27.4 million travellers, far lower than the 37.8 million at Changi Airport and the 41.7 million at Bangkok International Airport.

The present LCCT is overcrowded and was never intended to be a permanent terminal.

But with a strong terminal, Malaysia will unseat Singapore by 2013 with 55 million air travellers compared with slightly over 51 million in Singapore.

Thailand will still hold the top position with an estimated 57 million travellers going through Bangkok.

This scenario will only happen if a new low cost terminal is built.

The present LCCT is overcrowded and was never intended to be a permanent terminal.

Repeat – a temporary structure.

It was built as a cargo terminal.

Even recent plans to expand the LCCT to accommodate 15 million passengers a year will not help AirAsia much.

Indeed, its expansion will not be able to sustain AirAsia’s passenger volume within a year.

The airline’s growth estimates show that AirAsia will carry 12.3 million passengers in 2009; 15.7 million in 2010; 19.4 million in 2011 and 30 million by 2013.

The current LCCT also has a severe shortage of aircraft parking bays and this could impede the growth of AirAsia.

There are 33 bays for A320s and three bays for A330/A340.

By next year, there will be a shortfall of six bays for the airline that has ordered a fleet of new aircraft.

By 2010, the shortfall will grow to 16 bays.

Malaysia Airports Bhd has said that it will be able to build a new LCCT by 2014.

By this time, the shortfall of parking bays will be 41 and there will be a 12 million shortfall at the present LCCT.

Little wonder then that the Cabinet, Finance Ministry and Economic Planning Unit officials endorsed the plan to build KLIA East@Labu last week.

The reality is that the current LCCT has outlived its usefulness and with the Government facing the reality of a worldwide economic slowdown, funds are tight to build a new facility.

The plan put forward by Sime Darby Bhd and AirAsia involves private sector financing.

Sime Darby will set aside a sliver of the huge tract of plantation land it owns in Labu and its property arm will build KLIA East@Labu by 2011 at a cost of RM1.6bil, minus land cost.

The multinational will then sell the terminal to either AirAsia or a consortium led by AirAsia.

It’s not difficult to understand why Sime Darby is involved in the venture.

It wants the terminal and its ancillary facilities to become a catalyst for its Vision Valley development.

This Vision Valley master plan of housing, recreational, wellness and health facilities is aimed at meeting the needs of the Klang Valley population which is set to grow to 10 million by 2025.

Two of the main supporters of the KLIA East@Labu have been the Negri Sembilan and Malacca state governments.

Both these states know that they will benefit from the economic activity generated by the terminal while Malacca is likely to get a stronger inflow of tourists.

Sources said several other sites for the new LCCT at the present KLIA site were proposed but were found to be unsuitable.

The site at KLIA North was not suitable because the height of the ERL track makes it impossible to develop it there while the swamp soil condition at KLIA West is too costly and time consuming to develop.

How will KLIA and KLIA East@Labu be connected?

·A 7km branch road will be built to link KLIA East@Labu to KLIA and the North South Expressway.

·A 7km ERL link is proposed from KLIA to KLIA East.

·A bus hub will be built at KLIA East

·A 3km KTM Komuter railway line is being proposed from the railway station in Labu.

All the costs for building the airport, road and rail links will be privately financed.

Where is KLIA East@Labu?

About 8.6km from the KLIA main terminal building.

By road, the distance from KL’s Golden Triangle to KLIA East is 50km, compared with a distance of 78km to KLIA.

With the new terminal, flying low cost carriers will never be the same again. It can only get much better.

AirAsia X keeps hiring as London route seats snapped up

Malaysian budget carrier AirAsia X said it can weather the storm of a sharply deteriorating global economy and is hiring pilots to expand its routes to China, India, South Korea and Japan.

Chief Executive Azran Osman Rani said that while it was a challenging period for the aviation industry as many countries slip into a recession and carriers go bust, there were "a lot of business opportunities for us."

Bookings for its direct London flight on its leased Airbus 340-300, due to begin March 11, were overwhelming, he said, with 30,000 seats sold.

Demand was great as ticket prices cost about 2000 ringgit (A$838), less than half the price of a regular non-budget flight.

AirAsia X will fly five times a week between the Malaysian capital Kuala Lumpur and Stansted Airport on the outskirts of London.

Azran said AirAsia X was looking to expand its routes in 2009 into northern India including New Delhi, Amritsar and Mumbai, and to Beijing. In 2010 it aims to target South Korea and to Tokyo, Hokkaido in northern Japan and Kyushu in the south.

Azran said it was taking on new staff for its expansion. "We are still hiring pilots and cabin crew despite the tough economic outlook next year," he said.

AirAsia X, which currently flies to Australia's Gold Coast, Perth and Melbourne, and Hangzhou in China, will end the year with about 362 million ringgit in sales.

It aims to expand sales tenfold to one billion dollars by the end of 2010, despite the global slowdown.

Azran said the main challenge amid the uncertain global outlook was "to effectively scale up the scope of our business while keeping the lid on costs."

He said that oil prices, which have sunk sharply in recent months, were not expected to surge in the short and medium term.

The carrier currently has three A330-300 aircraft, one of which is leased. It has placed an order for 25 more by 2013, of which Airbus has delivered two.

Richard Branson's Virgin Group has taken a 20 per cent stake in the airline and the British billionaire has vowed to ensure that it turns a profit.

Airasia's New Call Centre To Be Ready By Feb 15

KUALA LUMPUR, Dec 30 -- AirAsia expects its world-class integrated call centre in Kuala Lumpur, currently under construction, to be up and ready for service by February 15 next year.

The centre will cater to all its operations in the country and will be capable of dealing with any crisis situation, the low cost carrier company said in a statement here Tuesday.

"As we are presently undergoing migration, our call centre is operating with limitations and thus you may find the lines to be heavily congested," said its group chief executive officer Datuk Seri Tony Fernandes.

The airline's present call centre receives an average total of 15,000 calls a day.

Amid the congestion, AirAsia is encouraging its customers to utilise its website at AirAsia.com where they will be able to perform a host of tasks and transactions related to their flight bookings.

"We sincerely apologise for the frustration caused by our call centre congestion. I assure you that you will have a whole new experience with our new international call centre when it's up and running in six weeks," Fernandes said.

Tony Fernandes named Tourism Personality Best Tourism Transportation Award for AirAsia

Dato’ Sri Tony Fernandes (far left), accepting the Tourism Personality of the Year award from Deputy Secretary General of the Ministry of Tourism Malaysia, Datuk Ab Ghaffar A Tambi (second from left). Accompanying them are Managing Director of Kumpulan Karangkraf Sdn. Bhd., Dato’ Hussamuddin Yaacob (second from right) and Libur Magazine Editor, Azli Halim (far right).

AirAsia received another recognition when AirAsia Group CEO, Dato’ Sri Tony Fernandes was named Tourism Personality of the Year at the Libur Tourism Awards 2008 held in Kuala Lumpur Wednesday. The Awards was organized by Libur, a Malay language travel magazine.

The Tourism Personality Award was aimed at honouring organizations and individuals for their endeavors in promoting and developing the country’s tourism industry.

AirAsia was also recognized with the Best Tourism Transportation Award in the airline category, for its contribution in transporting millions of tourists each year into Malaysia. With its extensive network in South East Asia with over 100 routes and covering over 60 destinations, the airline has carried over 55 million passengers since it started operations in 2001.

Dato’ Sri Tony in his acknowledgement speech said, “We always see Malaysia as an important tourist destination. When we first started, we made every effort to bridge all places in Malaysia by setting up an extensive domestic network. There are various places of interest that this country offers, so it is very important to provide easy access and of course, affordable fares, so that tourists will be motivated to return for their holidays.”

“AirAsia has garnered multiple awards internationally, but nothing beats the recognition given by our local tourism industry as it a mark of acknowledgement to our efforts for Malaysia, which will definitely inspire us further, as an ASEAN airline, to bring Malaysia to the forefront as one of the best travel destinations in the world,” he concluded.

The awards were presented by Datuk Ab Ghaffar A Tambi, Deputy Secretary General of the Ministry of Tourism Malaysia, representing Minister Dato’ Sri Azalina Othman Said.

With AirAsia X, a long-haul low-cost airline as its subsidiary, it provides additional links to Malaysia for tourists from Australia, China and Europe, contributing to the already solid passenger traffic into the country via the Low Cost Carrier Terminal (LCCT).

AirAsia-Jetstar merger brewing

Airlines’ bosses mulling over idea

PETALING JAYA: Something may be in the air between Qantas Airways Ltd and AirAsia Bhd. If things work out, a merger between AirAsia and the Australian carrier’s units Jetstar and JetstarAsia may be in the offing.

The talks are still in preliminary stages and it is learnt that AirAsia’s boss Datuk Seri Tony Fernandes and Qantas new chief executive officer Alan Joyce have been mulling over it. They last talked on the issue last week, a source said.

This comes at a time when Malaysia Airlines (MAS) is also in talks with Qantas for a possible alliance, but any alliance between Qantas and MAS will be between the network airlines.

Last week Qantas and British Airways announced the calling off of plans to merge into a mega carrier after failing to agree on key terms. The merger could have created an A$8bil plus carrier by market value with a fleet of about 500 planes.

The end of talks with BA opens new doors for other players such as MAS and AirAsia to search for synergies with Qantas. Now the brewing merger involves the low-cost carriers – AirAsia, Melbourne-based Jetstar and Singapore-based JetstarAsia.

Fernandes, when contacted yesterday, told StarBiz that “we are always talking and looking at ways to strengthen AirAsia into a global brand. If there are opportunities of equals which will enhance the brand, then it is something worth considering.’’ He declined to comment further.

Qantas’ Joyce was not immediately available for comment.

Datuk Seri Tony Fernandes

But a Qantas spokesman, in an e-mail response to a query from StarBiz, said: “We talk to airlines all the time about possible partnerships, relationships and cooperative agreements.’’

Jetstar’s Australian operation is wholly owned by Qantas but is managed separately and operates independently. Jetstar’s intra-Asian operation – JetstarAsia – is a Singapore-based partnership between Qantas (49%), local businessmen Tony Chew (22%) and FF Wong (10%), and Temasek Holdings (19%). JetstarAsia officials declined to comment when contacted yesterday.

In an economic downturn when passenger traffic is on a decline, airlines look to cooperate by forming code shares, alliances, strategic partnerships and even mergers to sustain operations. If a merger shapes up, it could possibly involve a share swap, a source said.

“A possible merger of Jetstar, JetstarAsia and AirAsia would mean that the operations of the airlines will be merged to create a stronger airline which could potentially be known as AirAsia/Jetstar with a larger network, a bigger aircraft fleet and wider access to many more markets.

“There are synergies by combining AirAsia and Jetstar. With a merger, passengers from Asia will have wider choices to fly to Asia, Australia, New Zealand, India, China and even Honolulu (via Jetstar),’’ he said.

The Kangaroo route (from any Australian point to KL and on to Europe) is a possible route that these airlines will capitalise on. Jetstar stopped flying the Sydney-KL route in September due to the economic slowdown.

Qantas and MAS talks were still progressing, another source added. He said the alliance would be modelled alongside the KLM/Air France structure. That model allows MAS to retain its identity.

MAS first began talking to Qantas a year ago.

Yesterday Qantas also announced that it has reduced its international and domestic fuel surcharges for the third time in recent months because of falling oil prices.

The new surcharges apply to tickets bought on, or after, Dec 23. Qantas executive general manager John Borghetti said the group’s fuel bill this financial year would still be A$400 million higher than in 2007/08. The surcharge has been cut by A$20 to A$35 for shorter-haul Asian destinations such as Bali.

The fuel surcharge for a one-way ticket from Australia to the United Kingdom and Europe has been cut by A$30 to A$160.

Qantas joins the league of airlines that are reducing fuel surcharges since crude oil prices have fallen over 70% from its July height of US$147 a barrel.