The bid by Malaysia’s AirAsia to launch a low-fare airline in India with the Tata Group has hit some unexpected turbulence as Singapore Airlines prepares to launch a joint venture with the very same investors.
Malaysia’s AirAsia has unveiled plans to launch a new domestic airline in India by the fourth quarter of 2013. Under the terms of a deal announced on February 21, the largest low-fare carrier in Asia will hold a 49-percent stake–the maximum holding permitted by the Indian government for a foreign investor–in the new airline. AirAsia is partnering with major Indian industrial groups Tata (to carry a 30-percent stake) and Telestra Tradeplace (21 percent).
AirAsia, the largest low-cost airline in Asia, has placed a new order with Airbus for 100 more A320-family narrowbodies, Airbus announced Thursday. The contract covers another 64 A320neos and 36 current-generation A320s, raising Air Asia’s single-aisle order count from Airbus to 475.
AirAsia is locked in negotiations with Airbus over an order for between 50 and 100 aircraft that the Malaysia-based operator wants to buy to fill gaps in its aggressive expansion plans before it takes delivery of its first new A320neo narrowbody in 2016.
AirAsia X, the Malaysian budget long-haul affiliate of Air Asia, is consolidating business in its core markets of China, Australia, Japan and Korea, according to CEO Azran Osman-Rani, who was speaking to AIN at the Low Cost Airlines World conference in Singapore last week.
Even as Asia Pacific airlines survived a testing 2011, overcapacity as a result of increased fleet orders is still concerning investors, who are already less willing to finance procurements in the current debt-laden environment. This was the message from Sydney-based thinktank the Center for Asia Pacific Aviation (CAPA) at the Low Cost Airlines Asia summit in Singapore last week.
AirAsia X, long-haul subsidiary of Malaysia’s AirAsia, the largest Asian budget carrier, plans to withdraw 11 weekly services to Mumbai and Delhi in India and 10 weeklies to its only European destinations—Paris and London—from its Kuala Lumpur hub.
Asian air transport rebel Tony Fernandes, chief executive of low-cost pioneer AirAsia, will soon join the industry establishment, assuming his planned acquisition of a 20.5-percent stake in failing flag carrier Malaysian Airline System (MAS) proceeds. Last week, his Tune Group agreed to become a significant minority shareholder in MAS in return for Malaysia’s sovereign wealth fund Khazanah Nasional taking a 10-percent holding in AirAsia.
AirAsia has selected a suite of Rockwell Collins avionics for 60 new Airbus A320s, with options for 40 more. AirAsia X, its low-cost affiliate, selected the same avionics for 15 Airbus A330 aircraft.
Under terms of the agreement, Rockwell Collins will provide maintenance support at a set price per flight hour for 15 years. Previously, the avionics firm announced a service-and-support contract with AirAsia for 100 A320 aircraft.