Vietnam is an important market for AirAsia in Southeast Asia.

Tony Fernandes - owner of low-cost airline AirAsia - said Vietnam is still an important market for AirAsia, operating 314 weekly flights.

Mr. Tony Fernandes, currently CEO of Capital A - AirAsia's parent company - shared with VnExpress the quarterly business results; strategy for the ASEAN market in general and Vietnam in particular...

- Can you share AirAsia's revenue and profit in the past 9 months?

- Last time - on August 29, we reported business results. In the second quarter of 2023, the core business helped Capital A generate cash flow worth one billion Malaysian ringgit (US$210 million). All four segments (aviation, aviation services, logistics, logistics) "skyrocketed": Ebitda (earnings before interest, tax, depreciation and amortization) reached 462 million ringgit (US$9,702), up 325% year-on-year; revenue increased to 3.2 billion ringgit (US$672 million), up 115% compared to 2022.

The upturn in international tourism boosted aviation revenue to 2.9 billion ringgit ($609 million) and Ebitda to 405 million ringgit ($8,505). Also in the second quarter, AirAsia recovered 77% of its passenger volume and 74% of its capacity compared to the second quarter of 2019. The average fare was 205 ringgit ($43.2), down slightly 4% year-on-year (due to increased capacity), but still 15% higher than the second quarter of 2019.

To date, we have successfully taken 175 aircraft out of storage, with 180 expected to return to service by the end of Q3. AirAsia’s target is to have a total of 200 aircraft back in service by the end of this year. I also expect passenger numbers to peak in Q4, and I am excited about the increase in ancillary revenue per passenger, which is expected to reach US$358 million in the second half of the year, up 27% from pre-Covid-19 levels.

AirAsia has increased its control of AirAsia Philippines to 100%. After 21 years, we have gathered four short-haul airlines under AAV: AirAsia Malaysia, Thai AirAsia, Indonesia and the Philippines. This merger contributes to reducing costs for aircraft maintenance, airports, staff salaries... With the above results, analysts and investors will have a clearer view of our financial capacity.

In June, my colleagues and I received good news: Skytrax honored us as "World's Best Low-Cost Airline", surpassing 325 other airlines, marking 14 consecutive years of winning this award.

According to Mr. Tony Fernandes, AirAsia is successful because it provides high-quality flight services at the best cost, while putting both staff and passengers first. Photo: NVCC

- What factors have helped AirAsia be honored by Skytrax for 14 consecutive years?

- It's heartwarming to win a major title for the 14th year in a row, given the challenges global airlines have faced over the past few years of the pandemic, especially without government support.

Thanks to the relentless dedication of our team and our leadership, transparency in all our operations, AirAsia has overcome all the fluctuations over the past two decades such as: 9/11 terrorist attacks, SARS pandemic, weather incidents, financial crisis, Covid-19... In the face of difficulties, we advocate building a strong, tangible team culture, motivating each other to move forward. In particular, "providing the best value, choice and excellent customer service" is the key to our success.

Typically, during Covid-19, we did not stand still, but used the downtime to review all aspects of operations, accelerate our digital transformation strategy to come back stronger. In "danger" there is always "opportunity", they always turn every crisis into an opportunity. Over the years, I have advocated building a solid foundation to compete in core markets, especially ASEAN - where AirAsia is strongest.

We recovered faster than our competitors because we were in the right segment, market (low cost, focusing on the growing ASEAN), offering the best fares in the short and medium-haul category.

In 2022, I decided to restructure the company, changing the name to Capital A, but the flight division will still be AirAsia. In addition, I will operate a super app that can book tickets, hotels, taxis, food and provide many other fintech services.

Mr. Tony Fernandes said that his group is not only dependent on airline tickets, but has built a flexible business model, with more than 10 products and services supporting each other. In the future, non-aviation digital businesses will bring more profits to airlines. Photo: AirAsia

- AirAsia's business strategy in the coming time?

- People are at the heart of everything we do and AirAsia puts our staff and passengers first, regardless of culture, religion or gender. As I said above, aviation is still attacking ASEAN. AirAsia Cambodia - our 5th market in the region - will take off in November.

In particular, Vietnam remains an important market. The group currently operates 314 weekly flights to and from Vietnam, including 6 routes to Thailand and 7 routes to Malaysia, ensuring travel needs.

We also aim to open routes that are not served by any other airline, serve new customers, and strive to provide the best and most consistent fares, regardless of fluctuations. We will maintain the 25-minute arrival and return flight service and launch a series of discount programs, 0 VND.

The recently launched no-delay insurance policy is one of many excellent policies for guests and will continue to improve. We have also introduced a biometric facial recognition system to ensure a seamless, contactless travel experience. With FastPass, you can bring up to 14 kg of carry-on luggage and access priority immigration lanes (applicable for international flights departing from and arriving at Klia2, Malaysia).

- How does AirAsia serve flights arriving and departing in 25 minutes without errors and how does it compensate for losses with a 0 VND promotion?

- High aircraft utilization and a quick turnaround time of 25 minutes are the key points of our low-cost model. We demonstrate this capability from day one and always keep a close watch on every step.

Specifically, AirAsia focuses on improving efficiency throughout its operations - from network planning, flight scheduling, pilot training, in-flight catering to ground support. When the team is in agreement and each step runs smoothly, flights are guaranteed to arrive and depart within 25 minutes, without any errors.

Like other low-cost airlines, we regularly offer promotions to stimulate tourism. A typical example is the zero VND rate on October 16. Obviously, not all seats on all flights are sold at the lowest price. Once those tickets are sold out, the higher price is immediately applied.

As demand for travel nears, fares tend to increase. It all comes down to supply and demand. The key to ensuring you get the lowest fares is to plan ahead and book early.

AirAsia staff undergo continuous training to ensure smooth operations and improve the passenger experience. Photo: AirAsia

- Looking back on 21 years of running the airline, what do you remember and are most proud of?

- I have always dreamed of creating affordable air travel for the masses of Asians. In my autobiography Flying High , I recounted my journey of buying a failing airline for the nominal sum of one ringgit and turning it into one of the world's largest and leading low-cost carriers over the past 21 years.

Every new airline faces challenges and has many obstacles to overcome, thanks to which it becomes strong and successful. There are so many things I remember and am proud of in that long journey. From just 2 initial aircraft, we now have more than 200 aircraft, in the future we will have 300 aircraft and 150 destinations. In 2 years, we transformed from an airline to a leading OTA, a one-stop digital travel and lifestyle platform in ASEAN. A special milestone for us was bringing back all employees who were laid off due to Covid-19.

Hieu Chau

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