AirAsia Resumes Domestic Flights in Malaysia; Philippines and Thailand Next

AirAsia resumed scheduled domestic flights in Malaysia on Wednesday.

The airline will also resume domestic flights in Thailand on 1 May, Philippines on 16 May and possibly Indonesia on 7 May 2020, subject to approval from the authorities.

The resumption of services will initially be on key domestic routes, which will increase gradually to include international destinations around the region, once the situation improves and governments lift borders and travel restrictions.

Executive Chairman of AirAsia Group, Datuk Kamarudin Meranun, said, “Flexibility remains the key to our business model. Our strong foundation coupled with robust relationships with suppliers and partners have enabled us to return to service stronger amid these unprecedented challenging times. We do not intend to take any new aircraft deliveries this year with the target to end 2020 with 242 aircraft, a net reduction of 1 aircraft from last year. We are relooking at our order book with Airbus. The decision to sell and lease our aircraft in late 2018, has provided us greater flexibility to scale back growth than owning aircraft today. We were also able to lock in the best price for those aircraft at prime market conditions while eliminating the residual risk of owning aircraft.

“We have also restructured a major portion of the fuel hedges with our supportive counterparties and are still in process of restructuring the remaining exposure. This will help deal with the excess of hedged volume against expected fuel consumption post-COVID19 and reduce the hedging losses if fuel price remains at today’s prices. Further measures in managing and containing cost include both the management and senior employees of AirAsia Group volunteering a  salary sacrifice, re-negotiating contracts and deferring all non-essential expenditures. We expect all these initiatives to result in at least a 30% cost reduction YoY in 2020. We hope to continue to sustain the 1.3 million jobs and counting in the sector in the region, directly and indirectly, and double our economic contribution to ASEAN’s GDP from US$15.3 billion in 2018 to US$35 billion in 2030.”

See also: Thai AirAsia to Resume Domestic Flights on 1 May, Thai Lion Air to Resume Domestic Flights on 1 May and Bangkok Airways to Resume Samui Flights on 15 May.

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