Reaching any point in Asia with just one stop
AirAsia is today Asia’s biggest player in the low-cost airlines business with eight affiliates. Do you still have dreams?
Tony Fernandes: I still have dreams of course. We managed over the years to build up a network of a true pan-Asian airline group which provided people in Asia with an opportunity to fly, thanks to affordable fares. But now, what we have been trying to do over the last two years is to provide the possibility for anyone to reach any point in Asia just with a single stop either in Bangkok, Kuala Lumpur, Jakarta, and tomorrow with India and Japan. India will open indeed the market to the Middle East; Japan can in the long term help us to open the market to the US West Coast. We then will be the only airline offering an unmatched number of Asian destinations with just one stop. Thanks to the AirAsia Group, the Asian continent is shrinking. And this is also my dream.
AirAsia X left Europe just a year after launching flights. Could you be back there again?
TF: Our economic model is valid for flights not exceeding a range of 8 to 10 hours, what I would qualify as “medium-long haul.” We could definitely fly out of Bangalore, our Indian base, to Europe. London-Bangalore could then be a possibility.
Why are you back to Japan?
TF: Our first joint venture in 2011 for AirAsia Japan was done in partnership with All Nippon Airways. However, the cultural gap between both of us was abysmal. ANA is an excellent carrier, but as a corporation it lacked the flexibility to get a new approach to business. We had, of course, a different vision of the airline’s development due to our different background. However, I was convinced that Japan had an enormous potential. First, because Japanese has a high purchasing power, one of the highest in Asia, and they like to travel. Second, because Japan fascinates other Asians who are keen to explore this country and its pop culture. The fact that the Japanese government recently simplified entry conditions into the country is fueling a boom from and to Japan. It made sense to be back.
How will the new AirAsia Japan then work?
TF: This is our second AirAsia Japan, and I have the feeling there will be no third version of it. We found this time the perfect new partners, which are outside the airline field but share the same passion that we do, such as the Japanese e-commerce giant Rakuten, that everyone knows in Asia, which is entering our venture with an 18% share. We remain committed to get a large slice of the Japanese air market as demand is strong while low-cost airlines’ penetration remains very low, at only 3%. We do not know yet what will be our first base. We are due to start next year with first domestic routes before venturing into international regional destinations in China, Korea, or Taiwan.
What are your wishes today to facilitate the development of air transport and particularly of the AirAsia group?
TF: I still believe that some airports continue to behave as monopolies. They still do not understand that these are airlines which bring passengers and business and not the contrary. Some airports such as in Malaysia or Macau have been very pro-active, creating synergies with airlines and offering financial incentives to attract airlines as well as lowering their taxes. Some others remain very expensive. For example in Thailand, the airports’ authority has been slow to react for re-launching passenger traffic following almost a year of turbulences. I believe also that Singapore should be more proactive due to increased competition as well as Indonesia, where the weakening Rupiah is depressing demand.
Where do you see new potential?
TF: The ASEAN economic community at the end of next year will certainly help to move faster. And I definitely like Myanmar.