Malaysia-based low-fare carrier AirAsia plans to phase out its foreign pilots as part of the carrier’s goal to employ an all-Malaysian workforce and to cut costs. The exercise would happen gradually with the expiration of the pilots’ respective contracts.
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.
Policy-making paralysis over much-needed reforms and liquidity concerns raised by the grounding of Kingfisher Airlines has deterred investors, vendors, lessors and suppliers from doing business in India’s air transport sector, according to delegates attending last month’s Asia-Pacific Airlines Association Assembly of Presidents in Kuala Lumpur. Association calculations show that average profits among Indian airlines amount to just $1 per passenger.
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.
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.
Budget long-haul airline AirAsia X is eyeing a stock market listing and fleet expansion to spread its wings across the globe. The Malaysia-based carrier’s chief executive, Azran Osman Rani, has been in talks with institutional investors about a flotation in the next year or two to fund growth.
Asia accounts for 25 percent of the world’s air traffic, a figure expected to grow to more than 30 percent in three years, largely thanks to the proliferation of low-cost carriers. With cheap fares, easy online bookings and direct connections to previously sleepy backwaters, budget carriers are bringing air travel to the masses in this part of the world.
Malaysian discount-fare airline AirAsia finally chose an engine type for the 60 Airbus A320s it ordered in two batches last December and in March. CFM International will supply its CFM56-5B as specified under a firm order signed here yesterday for 120 engines and nine spares valued at some $750 million at list price.