Turning around an airline with a $40 milion debt and just two planes isn't the easiest of jobs. In seven years, Tony Fernandes, CEO, AirAsia, has made this bankrupt Malaysian airline into the fastest-growing low cost carrier( LCC) in Asia, serving 110 routes with 72 A-320s. He telss he now has his eyes set on India:
What is AirAsia's success mantra?
Discipline, focus and a fierce determination to change things. We marketed our brand well and sell everything at the lowest cost good seats, food, extra luggage space. We used to sponsor Manchester United and now, referees from England and the Williams F1 team. And from this month, we'll be offering half-a-million free tickets. We have the highest utilisation each plane does an average of eight flights daily and flies about 14 hours. We do new routes mainly, like Kuala Lumpur-Tiruchy, which was started on December 1, 2008.
Why Kuala Lumpur-Tiruchy? Was a market survey done?
I've never done a market survey. All one needs is a city of 50,000 people to make a new route work. Some 19 million people flew my airline in 2008. I send teams to supermarkets, airports, etc, and get a feel of what people want. And i have never gone wrong. The Tiruchy route, our first in India, happened while i was attending a funeral and someone told me that all Malaysians were flying to Tiruchy. Today, it has 94 per cent occupancy. We'll fly to Chennai, Delhi and Mumbai next. In a country of over a billion people, if i can't fill up an A-320, i shouldn't be in this business.
Are low-cost carriers in India really low-cost?
No, they aren't. Even Air Deccan, which came closest to it, had a variety of planes turboprops, ATRs, A-320s. That means separate crew, training, seating plans, maintenance, etc. This complicates matters and translates into more costs. AirAsia, for example, has only A-320s. Simplicity is the mantra for an LCC's success. Also, most LCCs are owned by rich men, who want to like it themselves, with some add-ons. The LCC model is a basic and good product, with no space for frills. AirAsia's motto `Now everyone can fly', which i got while taking a shower, is as simple as it can get.
We've an efficient and fit cabin crew who clean the plane themselves, saving time. They're also given incentives like better salaries than the national carrier, and 5 to 10 per cent commission on whatever they sell.
Will AirAsia want to buy a stake in a domestic carrier in India? Which would it be?
Yes, i would be interested. My father was an Indian citizen and i would love to be in India. But i don't want to plan till regulations permit.
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