KUALA LUMPUR: On September 8 2001, a long-cherished dream of Tan Sri Tony Fernandes to own an airline came true when he and a group of like-minded friends took over the ailing AirAsia Bhd from DRB-HICOM Bhd.
When the new management announced its plan to create a low-cost carrier so that everyone in Asean can fly, it was a dream promised to the region’s 600 million population.
Today, that dream has come true.
AirAsia transformed air travel across a swathe of Asia over the past decade, creating a network of local franchises such as Indonesia AirAsia and a new market for budget cartravel in a region.
AirAsia flew more than 200 million guests over the last 14 years, not just across Asean but the wider Asia-Pacific region, and it continues to increase its route network by the day. Across the region, the group flies nearly 170 flights to more than 120 destinations.
Budget airlines account for over 25 per cent of Asia’s total passenger traffic, compared with just nine per cent in 2006, and AirAsia group is one of the largest of such carriers in the world.
Fernandes, meanwhile, became something of a celebrity during the group’s expansion.
He hosted an Asian version of the television show “The Apprentice”, where contestants competed for a job at one of his companies. He also bought English soccer club Queens Park Rangers and for a period owned and operated a Formula One race-car team.
AirAsia group’s rapid success was, however, greatly blighted when Indonesia AirAsia’s Flight QZ8501 went missing yesterday.
AirAsia, through its investment arm AirAsia Investment Ltd, owns 49 per cent in Indonesia AirAsia. The remaining 51 per cent is owned by Indonesian shareholders including closely held PT Fersindo Nusaperkasa.
Indonesia AirAsia posted a seven per cent increase in revenue to 1.72 trillion rupiah (RM484 million) in the third quarter ended September 30 2014. Its operating profit stood at 76.12 billion rupiah, down 33 per cent year-on-year (y-o-y), allowing the associate to record a net profit of 1.68 billion rupiah, down 30 per cent y-o-y.
Indonesia AirAsia’s number of passengers had dropped by 10 per cent to 1.85 million due to the cutting of non-profitable routes.
However, thanks to the 18 per cent increase in average fare together with the 22 per cent increase in ancillary income per pax to 166,540 rupiah, the carrier still managed to post a good increase in revenue with a strong load factor of 79 per cent.