Discount carrier AirAsia hopes to emulate Dubai’s success in connecting the world, but in a low-cost format in Bangkok and Kuala Lumpur as it looks to put its tumultuous pandemic years behind it and expand.
Founder Tan Sri Tony Fernandes envisages funneling connecting passengers through Bangkok and Kuala Lumpur airports en-route to the various destinations AirAsia and its long-haul arm AirAsia X
serve. Fernandes said AirAsia’s sweet spot was flights that were between an hour and a half and six hours long.
"What I’m trying to do, which will be the first time in the world, is to create a hub in Kuala Lumpur and Bangkok like Dubai and Qatar,” he said in an interview in the Thai capital. "Bangkok has kind of a hub, Singapore obviously has, but these are premium hubs. No one has really done a low-cost hub.”
AirAsia was hard hit by the pandemic and was forced to restructure debt, lay off employees and return some aircraft to lessors. The carrier’s parent Capital A Bhd. dropped plans to list via a blank-check firm and will instead merge with sister unit AirAsia X Bhd. and reduce its share capital by $1.4 billion to exit the Malaysian stock exchange’s financial distress classification.
Fernandes predicts a full recovery next year and forecasts that 2026 will be the industry’s "golden year”. Geopolitical headwinds have helped AirAsia, with more travelers choosing to fly within Asia rather than heading to the US or Europe, Fernandes said.
"We had five years of hell. But we’re back and we’re looking to grow,” Fernandes said. The company says it has rehired all the 2,600 employees it fired during the pandemic, and now employs 23,000 people.
Along with bringing connecting traffic through the planned hubs in Bangkok and Kuala Lumpur, Fernandes also expects to grow by adding more traffic to secondary cities, citing the example of flights from Chiang Mai to China. Last week, AirAsia X’s commenced its maiden foray into the African continent - as it looks beyond Asia for growth. - Bloomberg
