Regardless of soaring oil prices and weakening currencies, the outlook for aviation stays constructive as a result of “extraordinarily sturdy” demand, mentioned Tony Fernandes, CEO of AirAsia mother or father firm Capital A.
“We’re wanting so as to add 20 extra plane to the fleet for the primary time in a protracted, very long time even earlier than Covid,” he advised CNBC’s “Squawk Field Asia” on Friday.
What can be a “drawback,” nonetheless, is getting the aviation group’s fleet again out of upkeep, Fernandes added.
“In AirAsia we’ve 205 aircrafts and in AirAsia X we’ve about 20 aircrafts … getting slots and clearly getting them prepared for service has been an enormous problem.”
The constructive outlook comes despite detrimental market reactions to Fernandes’ resignation as AirAsia X’s Group CEO this week. AirAsia X is the long-haul price range flight arm of AirAsia.
AirAsia X shares dropped after the Oct. 31 announcement, and losses because the growth nonetheless stood at about 5% as of Friday morning.
“Sadly, no matter I do will get blown out of proportion. I went in there [AirAsia X] for a brief interval … I simply went in there to kickstart an airline that will have been closely restructured and was in hibernation,” Fernandes mentioned.
AirAsia X slipped into PN17 standing in October 2021, a designation issued by Bursa Malaysia to financially distressed corporations. These corporations might be delisted, ought to their monetary place fail to enhance.
“I believe we’re popping out of PN17. Whereas I used to be very in opposition to it, I believed it was harsh to place us into PN17 … really we have turned a detrimental into constructive.”
In his four-month tenure, Fernandes created a cargo enterprise in AirAsia X, which he mentioned has contributed “about 20% to the airline’s revenue in the course of the pandemic” and can proceed to play a significant position in its restoration.
He added that AirAsia X now has “very sturdy footing” and higher price construction.
Fernandes advised CNBC that he’s now specializing in the bigger Capital A group and “unlocking its actual worth.”
He added that there can be a newly shaped holding firm “very quickly,” which might comprise all aviation companies, together with its engineering firm Asia Digital Engineering, restaurant model Santan and its consulting arm.
“My job now’s to ensure we ship profitability, good money circulate development, have the precise funding on all of those and from the place we had been … the sky appears actually good,” Fernandes mentioned.
Even because the economy tightens, Fernandes mentioned he’s “not anxious” as Capital A will profit as a “worth supplier.”
“I have been by means of many slowdowns within the financial system and folks will go to the best-value operator,” he added.
As well as, the pandemic has offered an enormous alternative with the boom in e-commerce, which Fernandes mentioned is right here to remain.
“Even in logistics, it is a fantastic time for us to develop. For the primary time in our historical past, we have taken three cargo planes.”
He added: “It nonetheless takes a very long time to ship merchandise even from Kuala Lumpur to Singapore. [At] AirAsia, we do it in a day now. And so we’ll do point-to-point logistics, change the entire mannequin, and we see an enormous alternative for us.”