Wednesday 29 February 2012

AirAsia Indonesia predicts 21% bump in passenger growth

Budget carrier AirAsia Indonesia (AAI) says it is planning for a 21 percent increase in passenger numbers this year due to the arrival of 5 new planes.

“We are expecting to carry 6.2 million passengers this year, up 21 percent from last year’s nearly 5.1 million passengers,” AAI spokeswoman Audrey Progastama Petriny told The Jakarta Post recently.

Audrey said that the airline saw a 27 percent jump in passenger numbers in 2011 over 4 million passengers in 2010.

AAI is expecting 5 Airbus A320s to arrive throughout the year, with the first arriving last month.

“After the arrival of one new Airbus last month, we are operating 17 units of Airbus A320s,” she said.

AAI also operates 4 Boeing B737s on its local and foreign routes.

The aircraft upgrades were part of plans to phase out AAI’s Boeings in favor of an all-Airbus fleet, Audrey said.

The company would focus on strengthening its domestic routes by launching new service between Jakarta and Semarang, Central Java; Bandung, West Java, and Surabaya, East Java and Surabaya and Denpasar, Bali, in 2012, she added.

“We will launch the first flight on the Jakarta – Semarang route on March 9,” she added.

The other routes were launched on Feb. 14. The airline offers two flights a day on the Jakarta – Semarang route and one flight a day on the Bandung – Surabaya and Surabaya – Denpasar routes.

On Feb. 10, national flag carrier Garuda Indonesia also launched Bandung – Surabaya service, using a Boeing 737-500 with 12 business-class seats and 84 economy seats, versus AAI’s Airbus A320s with 180 seats.

Audrey said that AAI was not afraid to compete with Garuda as the airlines catered to different market segments.

She said that the potential for flights serving Bandung, Semarang, and Denpasar was very promising due to the rise in tourism and the meeting, incentives, conference, and exhibitions (MICE) sector in the country.

The Transportation Ministry previously forecast that the number of airline passengers would increase by 15 percent in 2012, spurred by robust economic growth, new carriers and the expansion of existing operators.

According to the ministry, the nation’s airlines transported almost 65 million passengers in 2011, up 12 percent from 59 million in 2010. (nfo)

Thai AirAsia eyes Myanmar capital

February 29, 2012 by
BANGKOK, 29 February 2012: Low-cost Thai AirAsia says it will start a service to Myanmar’s capital, Naypyidaw by year-end and add around five destinations during the first half of the year from three bases in Thailand.
Thai AirAsia CEO, Tassapon Bijleveld confirmed new services to Chongqing and Chennai, 23 March. So far, the airline has announced five new destinations for the first half of the year; of which two are domestic — Trang (15 Janaury), Nakhon Phanom (15 February).
The others are regional flights starting with Colombo in Sri Lanka, (1 March).Other regional services are planned from its bases in Bangkok, Phuket and Chiang Mai during the second half of the year.
Mr Tassapon said the airline should add around the same numbers of destinations as in the first half of the year, but declined to name them except to say one was to Naypyidaw, the new capital city of Myanmar.
(from left) Ambassador Extraordinary and Plenipotentiary of the People's Republic of China to the Kingdom of Thailand, Guan Mu; Thai AirAsia CEO, Tassapon Bijleveld and Ambassador Extraordinary and Plenipotentiary of India to Kingdom of Thailand, Anil Wadhwa were present at the official announcement of the new Chongqing and Chennai services.
“We are in the process of acquiring permission to operate flights to Naypyidaw..
The service should be able to commence this year,” he said.
Naypyidaw International Airport opened in December 2011, capable of handling up to 3.5 million passengers a year, although at present the only services are domestic flights from Yangon, Mandalay and Heho.
“It (Naypyidaw) is the administrative centre of government so there will be a growing demand for direct travel as the country opens to investors,” added Mr Tassapon.
He is also looking at destinations in India and China, but has reduced the flight time radius to 3.5 hours due to high fuel costs.
“Longer range flights are not feasible as long as fuel costs remain high,” he said.
Before the airline set the limit at four hours, but due to rising fuel costs it was forced to end its services to Delhi and Mumbai.
“The fuel price will remain volatile and we cannot just simply resume when the price drops or cancel with it rises.”
Airlines serving India are subject to a substantial aviation fuel tax of around 23%, which is crippling the country’s domestic airlines and was a factor in Kingfisher’s current financial troubles.
“We are looking at Mekong Region secondary cities,” commented Mr Tassapon who identified Danang, Nha Trang and Hue in Vietnam; Sihanoukville in Cambodia; Mandalay in Myanmar and Pakse in Laos as having potential.
Also, there have been requests to fly to Kunming, Hong Kong and Macau from its Chiang Mai base and to Indian cities such as Chennai and Bangalore from Phuket.
Phuket is now a popular destination for Indian weddings.
This year Thai AirAsia will add three more A320s to be delivered in addition to the two that arrived earlier in the year.
The airline targets 8 million passengers by the end of this year. Last year, it flew 6.8 million passengers, slightly off its 7 million target.

Tuesday 28 February 2012

AirAsia Philippines Facebook



About 43K Fans at 12 noon 29/2/12. For an airline with only 2 destinations, it's a great achievement.

http://www.facebook.com/AirAsiaPhilippines

Local AirAsia unit seeks permits abroad


The company has submitted applications to Singapore, Malaysia, China, Thailand, Hong Kong and Macau for airport slots and flight permits two weeks ago, Marianne B. Hontiveros, AirAsia Philippines’ president and chief executive, said in a briefing.
“I think it would take two to six months,” she said.“For instance, it would depend on the diplomatic agreement between countries,” she added.
Flights will be immediately launched should papers be completed, Ms. Hontiveros said.
This, after the airline bagged on Feb. 7 a critical permit from the Civil Aviation Authority of the Philippines that would enable them to apply for permits to other countries.
The company fulfilled additional requirements such as data on its aircraft, proposed initial training for crew, documentation of maintenance system, among others.
In the meantime, AirAsia Philippines said it will start operating domestic flights on March 29 in Clark, Pampanga with two flights per week going to Davao and Kalibo.
The carrier is a joint venture between AirAsia Bhd. which owns 40%, and Philippine businessmen Ms. Hontiveros, Antonio O. Cojuangco III and Michael L. Romero.
The firm’s entry poses competition to local carriers Cebu Pacific and Philippine Airlines which likewise operate routes from the Philippines to elsewhere in the region.
AirAsia Philippines’ parent has been flying to the country since 2005 from Kuala Lumpur and Kota Kinabalu
In the last quarter of 2011, AirAsia Philippines had been granted seat allocations by the Civil Aeronautics Board for flights to Malaysia, Cambodia and Japan.
The carrier was granted seats on the Clark to Kuala Lumpur route.
It was also granted allocations for flights on Clark to Cambodia route.
AirAsia Philippines was also granted flights either on the Clark-Osaka route or Clark-Nagoya route.
The company expects to serve 857,000 passengers for its first full year of operations by offering the lowest possible rates and matching cheap flight offerings of rival carriers.
In August last year, the carrier’s first aircraft, a 180-seater Airbus A320, arrived at its hub in Clark.
Its second aircraft, meanwhile, was delivered latter part of 2011.
She also said that the company would be adding two more airbuses in the second half the year, while it is eyeing to have 14-16 airbuses in its fleet in the next five years. -- Cliff Harvey C. Venzon

Thursday 23 February 2012

AirAsia Reports 2011 Financial Results

http://www.asiatraveltips.com/news12/232-AirAsia.shtml


AirAsia reported its fourth quarter and full year results for the financial year ended 31 December 2011 on Wednesday.

The company posted a record revenue of RM4.47 billion, up 13% from a revenue of RM3.95 billion reported in 2010. Operating profit was reported at RM1.20 billion, up 12% from an operating profit of RM1.07 billion reported in the previous year. Core net income for the same period was RM880.78 million, up 18% from a core net income of RM749.32 million in 2010.

Group CEO, Tan Sri Dr Tony Fernandes said, “We are proud to achieve an increase of 12% in operating profit and increase of 18% in core net income for FYE 31 December 2011. This is remarkable in an environment where macroeconomic factors such as fuel prices have impacted us and every other airline. Average fuel prices have substantially increased 36% over the year. Even though fuel costs make up 50% of our total cost, our resilient business model, focus on cost control, and an efficient operation has enabled us to sustain high EBITDAR and EBIT margins.”

AirAsia reported an EBITDAR margin of 41% and EBIT margin of 27% for FYE 31 December 2011. Cost, measured by cost per available seat per kilometer (“CASK”) was reported at 12.56 sen, a slight increase of 6% y-o-y. However, CASK, ex-fuel, stood at 5.99 sen, a remarkable reduction of 13% y-o-y.

“The decline in profit after tax was primarily due to the unrealised foreign exchange losses on translation, which is required for reporting purposes under the accounting standards. Our full year results indicated that we were on the right path – that is, we managed matters that were within our control. Furthermore, there was a deferred taxation in 2011 due to the balancing charge on capital allowances and investment allowances as a result of the sale of 5 aircraft to AirAsia Indonesia in compliance with the Indonesian regulations to maintain their AOC,” Fernandes added. “Non-operating items such as deferred taxation, foreign exchange gains/losses and fair value gains/losses on derivative financial products are included to derive the profit after tax due to FRS139. These are only accounting entries and should not be included when evaluating the performance of the company. Profitability for a company like AirAsia, that has USD-denominated borrowings but has financial statements in Ringgit, should be measured at the core net income level which has shown an increase of 18% y-o-y.”

“2011 was a momentous year for AirAsia. We celebrated our 10th year of delivering our brand promise of low fares, living up to our pledge of “Now Everyone Can Fly” to more than 135 million passengers across the region. We flew into new destinations expanding our route network and increased frequencies on high demand routes, reaffirming our leading market share. We achieved our target load factor of 80% underpinning the strong demand for air travel. Results so far are beyond our expectations and thus, we rewarded our loyal shareholders with a maiden dividend payout of 3 cents per ordinary share last year. AirAsia also placed a historic firm order of 200 A320 NEOs with Airbus in line with the huge potential growth, the biggest order in the region,” said Fernandes.

He further added, “Our gearing at the end of the year was 1.43 times with a healthy cash balance of RM2.02 billion. This is a sign of operational health and it also provides ammunition in times of financial need. We have done well managing our capital spending and fleet expansion last year, evidenced by our positive free cash flow.”

On ancillary income, Fernandes said, “Ancillary is up in all three of our operations for FYE 31 December 2011: MAA at RM45 per pax (up 2% y-o-y); AirAsia Thailand at THB383 per pax (up 29% y-o-y); and AirAsia Indonesia at IDR136,650 per pax (up 11% y-o-y). Although the increase in MAA’s ancillary income per pax is minimal due to the reclassification of AirAsiaGo as a share of profits from associates, ancillary income will continue to be the driving force for AirAsia to grow further as we roll out more exciting initiatives this year.”

Fernandes also said “Last year we expanded our adjacency businesses and ventured into businesses with established partners which allowed us to keep our focus on our core business. We are pleased to recognise profits from Asian Aviation Centre of Excellence (“AirAsia-CAE”) and also AAE Travel (“AirAsia-Expedia”) in their first six months of operations.”

On the associates, AirAsia Thailand posted revenue of THB15.87 billion, recording a growth of 33% y-o-y attributed to higher passenger volume, a higher contribution from ancillary income and improving yields for FYE 31 December 2011. Operating profit was reported at THB1.94 billion, up 5% y-o-y albeit a 61% y-o-y increase in fuel expenses. For the same period, AirAsia Thailand increased its profit after tax to THB2.03 billion from THB2.01 billion reported in 2010.

As for AirAsia Indonesia, it posted a 34% rise in revenue of IDR3,705.30 billion, supported by a 28% increase in number of passengers carried, reflecting a strong demand environment for FYE 31 December 2011. Operating profit decreased to IDR149.65 billion for the same period due to the hike in fuel prices and also the provision for early return of aircraft. In the fourth quarter of 2011, the migration to a fully A320 fleet and also its recent move to Terminal 3, amongst others, have helped lower its CASK (ex-fuel) by 19%.

Outlook

On the outlook for 2012, Fernandes said, “Since the start of this year, we have announced 7 new routes (including 4 new destinations: Trang, Nakhon Phanom, Chongqing and Semarang) and increased frequencies on some routes across the group ensuring better connectivity for our guests and there will be more exciting news to come. This, supported by the delivery of 20 new A320 Classic in 2012, of which 17 aircraft comes from our firm orders with Airbus, will maintain our status on the top of the list of leading low-cost carriers in the region. With financing secured on all these deliveries and the establishment of our own training centre (AirAsia-CAE) that will contribute positively to our vast expansion plans, we will be flying ahead of the flock in the coming months and years. We also look forward to the listing of AirAsia Thailand and AirAsia Indonesia this year.”

Fernandes was excited about the latest development on AirAsia Philippines and AirAsia Japan which had obtained their respective Air Operating Certificates. He said, “AirAsia Philippines and AirAsia Japan shall commence their inaugural flights in H1 2012 and H2 2012 respectively. We remain positive for both ventures as Philippines, not just with its archipelagic geographical nature which is highly conducive for air travel but also the full support from the government to expand tourism in the country and Japan, with its low LCC penetration rate, presents a significant LCC opportunity. Our proven track record and strong brand of low fares shall pave the way for exponential growth in both markets. With the addition of these two new ventures, our playground can be expanded further.”

FYE2011

Revenue

Malaysia : RM4.47 Billion (up 13% y-o-y)
Thailand : THB15.87 Billion (up 33% y-o-y)
Indonesia : IDR3,705 Billion (up 34% y-o-y)

Operating Profit

Malaysia : RM1,199 Million (up 12% y-o-y)
Thailand : THB1,943 Million (up 5% y-o-y)
Indonesia : IDR149,654 Million (down 53% y-o-y)

Core Net Income

Malaysia : RM880.78 Million (up 18% y-o-y)
Thailand : THB1,908.69 Milion (up14% y-o-y)
Indonesia : IDR94,905 Million (down 61% y-o-y)

Deposits, Bank and Cash Balances

Malaysia : RM2,020 Million (up 34% y-o-y)
Thailand : THB1,211 Million (up 105% y-o-y)
Indonesia : IDR32,191 Million (down 20% y-o-y)

Ancillary Income per Pax

Malaysia : RM45 (up 2% y-o-y)
Thailand : THB383 (up 29% y-o-y)
Indonesia : IDR136,650 (up 11% y-o-y)

Passengers

Malaysia : 18.0 Million (up 12% y-o-y)
Thailand : 6.9 Million (up 20% y-o-y)
Indonesia : 5.0 Million (up 28% y-o-y)

Net Gearing Ratio : 1.43x (reduced from 1.74x y-o-y)

Wednesday 22 February 2012

AirAsia Q4 profit declines 56pc on fuel costs

http://www.btimes.com.my/Current_News/BTIMES/articles/20120222212126/Article/index_html

AirAsia Bhd, the region’s biggest budget carrier, posted a fourth straight drop in quarterly profit as fuel costs eroded gains from carrying more passengers.

Net income dropped 56 per cent to RM135.7 million (US$45 million), or 4.9 sen per share, in the three months ended Dec 31, from RM311.1 million, or 11.2 sen, a year earlier, the Sepang, Malaysia-based carrier said in an exchange filing today. Revenue rose 9 per cent to RM1.27 billion.

The company will take delivery of three Airbus SAS A320 aircraft in the first quarter of this year and will start two new routes from Malaysia, AirAsia said.

The carrier may start a low-cost airline in the Middle East and form ventures in South Korea and Vietnam as it seeks to expand to new markets, chief executive officer Tony Fernandes said this month. Services in the Philippines will begin as early as March.

“Passenger demand in the first quarter for the Malaysian, Thai and Indonesian operations remains positive,” AirAsia said in the statement today. “Load factors achieved in the month of January were higher than the prior year in Malaysia and slightly lower in Thailand and Indonesia, with average fares higher in all three countries.”

AirAsia fell 1.4 per cent to RM3.65 at the close in Kuala Lumpur, before the earnings announcement. The stock has declined 3.2 per cent this year, while the FTSE Bursa Malaysia KLCI Index has gained 2 per cent.

Fuel expenses at AirAsia jumped 62 per cent to RM475 ringgit in the fourth quarter from a year earlier. A charge of deferred tax more than doubled to RM198 million.

AirAsia flew 9 per cent more passengers in the quarter from a year earlier. Average fare per passenger rose 4 per cent to RM196.

AirAsia’s long-haul arm last month said it will stop flying to London, Paris and India because of the introduction of a European carbon-emissions levy, a tax increase in the UK and slowing demand.

Largest shareholders of AirAsia, including CEO Fernandes, last year swapped a stake in the carrier for shares of Malaysian Airline System Bhd, the nation’s biggest long-haul carrier.

AirAsia’s venture in Japan with All Nippon Airways Co. will begin flying in August, while the long-haul affiliate AirAsia X Sdn is considering a new hub in Australia. -- Bloomberg

Sunday 19 February 2012

AirAsia to launch 4 domestic, 6 int'l routes this year


By Mary Ann Ll. Reyes, The Philippine Star

http://www.abs-cbnnews.com/business/02/19/12/airasia-launch-4-domestic-6-intl-routes-year

MANILA, Philippines - AirAsia Philippines is set to launch four domestic and six regional destinations this year.
The country’s newest budget carrier is 40 percent owned by Malaysia-based AirAsia Berhad, considered the world’s most successful low-cost carrier, while the rest is owned in equal shares by Antonio “Tonyboy” Cojuangco, port operator Michael Romero and former broadcast journalist Marianne Hontiveros.
Hontiveros, AirAsia Philippines chief executive, told The STAR that they currently have two new Airbus 320s and plan to lease two more within the year.
She revealed that they are scheduled to mount flights from Clark to Kalibo and Clark to Davao anytime soon.
The Civil Aviation Authority of the Philippines (CAAP) earlier granted AirAsia Philippines its airline operating certificate (AOC) that would allow it to fly commercially out of the Diosdado Macapagal International Airport (DMIA) in Clark, Pampanga.
Hontiveros earlier said that they plan to mount flights from Clark to Singapore, Hong Kong and Macau.
Aside from the three international destinations, the carrier plans to fly to Kalibo in Aklan province, Puerto Princesa in Palawan province, Incheon in South Korea, and Bangkok in Thailand.
Other than Singapore and Hong Kong, Hontiveros said that they are still waiting the necessary approvals, such as airport slots, among others, to be able to fly to other regional destinations.
She could not say when they are scheduled to mount their first commercial flight but said this will be soon.
In the last quarter of 2011, AirAsia Philippines had been granted rights by the CAB to fly to Malaysia, Cambodia and Japan.
The carrier was granted 1,260 seats a week on the Clark to Kuala Lumpur route, CAB has previously said.
It was also granted seven flights per week on the Clark to Cambodia route.
Moreover, AirAsia Philippines was granted six flights per week that it can utilize either on the Clark-Osaka route or Clark-Nagoya route.
The carrier unveiled plans for a $25-million capital expenditure in December 2010.
Its parent has been flying to the country since 2005 from Kuala Lumpur and Kota Kinabalu.
AirAsia Philippines had planned to commence operations as early as October last year but failed to do so, pending the receipt of the necessary permits from regulators.
AirAsia Philippines in August last year had already received a temporary operating permit from the Civil Aeronautics Board.
Last year, the carrier’s first aircraft, a 180-seater Airbus 320, arrived at its hub in Clark. Its second aircraft, meanwhile, was delivered later in 2011.
===================================================

19/2/12 Cebu and Puerto Princesa added to the destination choice

Saturday 18 February 2012

Asian budget carriers set for price war


By Shin Hyon-hee
The Korea Herald/Asia News Network
Saturday, Feb 18, 2012

Competition between Asia's low-cost airlines is poised to heat up this year as carriers from Japan and China are lining up to launch new routes to Seoul, seeking to gain an upper hand in one of the world's fastest growing aviation markets.

That will bring fresh challenges to Korea's two full-service airlines, which are already being pummeled by volatile fuel prices, lower cargo demand and a weaker local currency.

Though they own or hold stakes in budget carriers, Korean Air and Asiana Airlines will inevitably see their slices shrivel in the aviation market, experts say.

More and more budget-conscious tourists are willing to surrender some comfort in return for lower fares.

The number of Koreans using low-cost airlines topped 10 million for the first time last year, up a staggering 32.5 per cent from 2010, according to the Transport Ministry.

The combined market share of the country's five low-cost airlines ? Jeju Air, Air Busan, Jin Air, Eastar Jet and T'way Air ? rose to 16.5 per cent last year, up 3.3 percentage points.

The five together control more than 41 per cent of domestic traffic.

The no-frills carriers operate 25 international itineraries. More than 1.8 million Koreans flew overseas with them last year, doubling their collective market share to 4.3 per cent.

Yet that portion could reach 20 per cent in the coming years, forecasts analyst Joo Ik-chan at Eugene Investment & Securities.

"It doesn't have much impact on big players at this point because they fully dominate lucrative North American and European routes. But in the long term, budget carriers will bite into their stakes," he says.

Newcomers

Tapping the Korean market are AirAsia Japan, Jetstar Japan and Peach Aviation from Japan as well as Spring Airlines of China.

They are expected to offer cheaper tickets and more choices of destination than their Korean peers, officials say.

Peach, which is set up last year by All Nippon Airways, is set to launch daily flights between Incheon and Osaka in May.

Its price-focused strategy surprised the Japanese aviation industry by setting the rates for domestic flights at a third of what its parent ANA charges.

"Although everything else is charged for, we guarantee that fares won't disappoint you," Kim Woo-geol, chief of Peach's Seoul office, recently told a local travel magazine. The company is planning to introduce a promotional round-trip fare of 10,000 won ($8.90) to mark the inauguration of its latest route.

AirAsia Japan, a joint venture between ANA and AirAsia, is gearing up to fly from Tokyo to Incheon and Busan starting October.

AirAsia X, the long-haul affiliate of Asia's largest low-fare airline, began services between Kuala Lumpur and Seoul in August 2010.

Jetstar Japan, which is owned by Japan Airlines, Mitsubishi Corp. and Qantas Airways, aims to begin operations out of Tokyo in the second half, while Shanghai-based Spring Airlines is reportedly preparing to enter the Korean market by the end of this year.

"The recent inroads by foreign carriers, coupled with the robust performances of local ones, prove that there is clearly a market for budget travel," says Martin Song, an analyst with Woori Investment & Securities.

"Despite persistently high jet fuel costs, air travel demand is improving, underpinning their business. Competition is unavoidable in such an up-and-coming market ? the thing is how to sustain growth."

Attack and defense

To cope with stiff competition and ensure a larger source of revenue, Korea's five low-cost airlines are also reinforcing their international networks.

Jeju Air, the country's largest budget carrier, has two new Japanese routes slated for March ? to Nagoya and Fukuoka ? and one to Ho Chi Minh in Vietnam for April.

That will raise the number of its international destinations to 14 from 11, also including Hong Kong, Bangkok and Osaka.

The company currently runs eight units of Boeing 737 aircraft and will add four to its fleet this year. It targets 360 billion won in sales, up 40 per cent from last year.

"We anticipate fierce competition in the aviation markets surrounding Korea and Japan this year with the launch of Peach here," a Jeju Air official says.

"We'll make utmost efforts to firm up our position as a leading LCC in Northeast Asia."

Air Busan, whose largest stakeholder is Asiana Airlines, is planning to initiate a flight next month to Qingdao in China.

It and Jin Air, which is set up in 2008 by Korean Air, each have six international destinations including Shanghai and Tokyo.

Eastar flies to Tokyo, Sapporo and Kota Kinabalu, while T'way launched its maiden flight to Bangkok in October.

Korean Air and Asiana, meanwhile, will stay focused on long-haul flights and freight operations.

Korean Air, the world's second-largest cargo carrier, unveiled its new Boeing 747 and 777 freighters on Tuesday, which it says consume less fuel, make less noise and cut emissions by up to 17 per cent compared with the existing ones.

Freight accounts for about 30 per cent of the company's sales.

The flag carrier also saw a 41 per cent increase in the number of business-class passengers on long-haul routes in the last quarter of 2011.

Asiana's upcoming new planes will enable daily services of its all North American routes this year. Although its cargo volume remained flat, its passenger revenues rose almost 14 per cent in that quarter, driving a 45.4 per cent surge in operating profit to 54.9 billion won.

Lingering concerns

Some skeptics worry that overheated competition could erode the profitability. Rumors are swirling that two of the five budget carriers are looking to put themselves up for sale due to mushrooming losses.

"Japanese and Chinese airlines will likely focus on routes to metropolises such as Osaka and Shanghai as Korean carriers do currently. That will saturate the market and all of them in turn might end up eating away each other rather than making profits," an industry official says, declining to be named.

Rep. Chung Hee-soo of the ruling Saenuri Party also points out that budget carriers are more prone to accidents, flight cancellations and delays owing to their hectic schedules.

"LCCs have small fleets so they keep on running the same planes over and over again," he says. "That may cause a lack of proper maintenance and eventually a major accident."

The number of trips by a single jet averages at 6.5 per day for Korean budget airlines, versus Korean Air's 3.6 and Asiana's 4.6, according to the Transport Ministry. Air Busan had the highest figure of 8.1.

Friday 17 February 2012

All Nippon Airways Plans New Grp Formation To Lift Profits

http://online.wsj.com/article/BT-CO-20120217-704169.html

-- All Nippon Airways to boost international capacity by 22% in fiscal 2013 compared with fiscal 2011

-- To launch Narita-Seattle, Tokyo-San Jose routes

-- Says it aims to cut costs by Y100 billion by fiscal 2014

(Recasts 1st paragraph, adds comments by ANA executives in 5th, 7th, 9th-11th paragraphs, net profit target in 12th paragraph, background throughout)

By Yoshio Takahashi and Hiroyuki Kachi
Of DOW JONES NEWSWIRES

TOKYO (Dow Jones)--All Nippon Airways Co. (9202.TO) said Friday it will transform its corporate structure into a holding company to optimize groupwide operations and capitalize on its new low-cost carriers. But doubts remain over how effectively full-service and budget carriers can operate under the same corporate umbrella.

The planned new group structure comes as ANA looks to more than double profit over the next two years under a new mid-term business plan.

The airline unveiled the plan two days after resurgent rival Japan Airlines Co. disclosed its five-year business plan. JAL has already undertaken broader restructuring steps than ANA in the wake of its bankruptcy protection filing in 2010 and competition between the two is set to further intensify as ANA looks to strengthen its grip on what was JAL's long-held crown as Japan's largest carrier.

ANA said it plans to adopt a holding company structure on April 1, 2013, pending approval at its shareholders' meeting on June 19 and from transport authorities.

"It will be the best structure for handling multiple brands," Shinzo Shimizu, an ANA senior vice president, said at a press conference.

Next month ANA will start operating Peach Aviation Ltd., a low cost carrier in which it owns the largest stake of 39%. Its 67%-held AirAsia Japan Co. budget airline subsidiary will also begin services in August. AirAsia Japan is a joint venture with Malaysia's AirAsia Bhd. (5099.KU).

Under the current group formation, "we are likely to think about ANA first" when compiling group strategy, said Osamu Shinobe, an ANA executive vice president.

ANA executives have warned they should keep the low-cost carriers relatively independent as they have a business model that is completely different from and new to ANA.

Budget airlines focus on serving at the lowest possible costs while ordinary carriers focus more on providing quality service.

Shimizu said the ANA, AirAsia Japan and Peach brands will all operate under the holding company, which will oversee them all to make strategies for the entire group. He shrugged off the possibility that the new carriers would lose independence by being placed under the same entity as ANA, saying: "We can guarantee their freedom."

By establishing the new company, the airline can also integrate back-office operations to reduce costs, Shimizu added.

ANA aims to rack up an annual net profit of Y55 billion in the fiscal year ending March 2014, compared with Y20 billion that the company is predicting for this fiscal year. The target indicates that ANA hopes to narrow the gap in profit with JAL, which is targeting Y115 billion for the same year compared to Y160 billion expected for this fiscal year.

All Nippon Airways said that it will boost its passenger transport capacity on international flights by 22% by the fiscal year ending March 2014, compared with the current fiscal year, to beef up routes to the U.S., Europe and Asia.

The Tokyo-based airline will bank on the new fuel-efficient Boeing 787 Dreamliner for the increased international services. The company plans to receive 27 787s by the end of March 2014 out of a total of 55 that it has ordered.

It already plans to introduce new services linking Narita Airport with Seattle and San Jose from April using the Dreamliner aircraft.

The carrier expects the aircraft, which is 20% more fuel-efficient than its current equivalent, to give it an edge in the intensifying fray with low-cost carriers flying to Japan while fuel costs remain high. ANA is the first airline to take possession of the new-generation aircraft.

At the same time, ANA is attempting to strip back costs by Y100 billion by the fiscal year ending March 2015 through ongoing reform steps, which in part take the form of a reduction in labor costs and other expenses.

-By Yoshio Takahashi and Hiroyuki Kachi, Dow Jones Newswires; 813-6269-2789; Hiroyuki.Kachi@dowjones.com

ATW's 2012 Value Airline of the Year - AirAsia

http://atwonline.com/airline-finance-data/article/atws-2012-value-airline-year-airasia-0127

This year, ATW has created the new Value Airline of the Year award to recognize outstanding achievements by those carriers whose business strategy provides exceptional value for the customer and the shareholder.

The story of our inaugural winner of this award reads like the script of a Hollywood “feel good” movie. From humble beginnings 10 years ago, with just two aircraft and six routes, this carrier has grown to dominate Southeast Asia and has brought affordable travel to over 100 million people.

But ATW’s 2012 Value Airline of the Year has done far more. It is also reshaping travel patterns in the region and has become a trendsetter with innovations that others seek to emulate.

In Asia it is called the “AirAsia Effect” and it is a phenomenon that has changed travel patterns almost overnight as ultra-low fares swept the region and extended air travel to millions of people who had never flown before.

Today, the AirAsia Group, consisting of AirAsia, Thai AirAsia, Indonesia Air-
Asia and international long-range associate AirAsia X, operates 4,500 weekly flights on 72 routes to 150 cities in 20 countries with a fleet of 100 aircraft that is mostly made up of Airbus A320s. On order are 175 A320s and 200 A320neos.

The impact is best seen at Kuala Lumpur International Airport, where AirAsia is now the largest user, operating almost half of all flights.

On top of its stunning market-share rise, AirAsia more than doubled its 2009 profit to 1.52 billion Malaysian Ringgits in 2010—that’s almost half a billion dollars.

Under Group CEO and founder Tony Fernandes, all of the company’s other key numbers also soared. Group revenue climbed almost 17%; passenger numbers leapt more than 13% to 25.6 million. Group ASKs were up 14% to 38.7 billion and RPKs jumped by more than 21% to 29.6 billion.

All airlines in the group were profitable and all recorded double-digit passenger growth. And the group is now expanding with joint ventures in the Philippines and Japan that will launch this year.

During 2010, the Group carried its 100 millionth passenger.

After being kept out of Singapore for seven years, AirAsia is now the biggest LCC operating into Changi Airport and the second largest airline with 74 daily flights to and from 13 destinations.

“The secret to AirAsia’s success is its staff,” Fernandes said. “Harnessing and channeling all that energy and talent, and allying that with a dedication aimed at providing the highest-level service at the lowest-level cost to our guests, has kept us ahead of the rest in the industry.”

AirAsia’s game-changing business strategy has changed travel in the region forever. AirAsia’s mantra is: “Dream the Impossible; Believe the Unbelievable; Never Take ‘No’ for an Answer.” Its success in delivering that mantra makes AirAsia a standout choice as the ATW2012 Value Airline of the Year.

Wednesday 15 February 2012

Tune Group sets up JV with Qatari partner


Tune Group, a Malaysia-based conglomerate, has joined hands with a prominent Qatari businessman Mohamed al-Saad to set up Tune Middle East with headquarters in Doha.
Tune Middle East will look at investing in a range of business ventures in Qatar, GCC and the entire Mena region, it was announced here yesterday.
Tune Middle East is a joint venture between Tune Group, led by its co-founders, Tony Fernandes and Kamarudin Meranun and their Qatari partner, Mohamed al-Saad.
The promoters said the scale of investments would be decided by the ventures they are taking on in Qatar and the region.
Fernandes said Tune Middle East would “immediately” venture into hospitality and financial services industry in the region.
“We are in a fantastic playground. Qatar is rapidly progressing and there are incredible opportunities here. We have a strong and reliable partner in Mohamed al-Saad,” Fernandes said.
According to Fernandes, Tune Middle East, headquartered in Qatar would be a platform to roll out Tune brands in GCC and The Middle East and to bring skills, investment and marketing opportunities to the region.
Fernandes said, “Tune Group is extremely pleased to be partnering with Mohamed al-Saad; we have the same vision, enthusiasm and motivation, together with a shared belief in the intrinsic value of building businesses. Tune Middle East will be the nucleus for our expansion in Qatar and the Middle East. With a total population of over 40mn among the Gulf Co-operation Council (GCC) countries alone, the Middle East is a vibrant market for Tune to tap into and we look forward to building our businesses here.
“There are some really strong synergies that have brought us to this exciting mutual commitment. Both Malaysia and the UK, where the Tune Group has a strong presence, enjoy superb relations with Qatar. Our philosophy of building business and brands aligns well with HH the Emir of Qatar’s National Vision for 2030, while, to use an aviation metaphor, our multifaceted capabilities mean we can deliver a blend of top class solutions in the Middle East, in Europe and in Asia.”
Al-Saad said, “I am delighted to formally welcome Tune Group to the Middle East and most especially here in Qatar. Tony, Kamarudin and I have been looking at ways to collaborate for some time, not only in the GCC, but further afield in the UK and in Asia. We will ensure that Tune Middle East will be a dynamic entity with a strong, credible reputation in Qatar, the Middle East and on the international stage.”
Fernandes and Meranun are the team behind Asia’s leading and largest low-cost carrier AirAsia.
Tune Group was established in 2007 with the aim of breaking down affordability barriers in various aspects of daily life – via Tune Hotels, Tune Talk and Tune Money. Tune Group’s portfolio today also includes the automotive technology company Caterham Group and the English Premier League team Queens Park Rangers (QPR).
AirAsia eyes Qatar link
Malaysia-based low-cost carrier AirAsia is interested in flying to Doha, Group CEO Tony Fernandes has said.
“We are discussing the prospects with our friend, Akbar al-Baker, Qatar Airways CEO,” Fernandes said in Doha yesterday.
Currently, AirAsia flies to Tehran in the region.
He said there was tremendous potential for a “real low-cost carrier” in the region.“There is a huge Haj / Umrah traffic in the region. We can really cater to that traffic. Currently, the intra-Gulf fares are high. More people will be able to fly frequently, if the fares are reasonable,” said Fernandes, who along with his Deputy Group CEO Kamarudin Meranun, built Asia’s leading and largest low-cost carrier AirAsia.
The once ailing carrier, AirAsia has more than 100 Airbus planes in its fleet now. When Fernandes and Meranun acquired the carrier in 2001, they had just two aircraft. AirAsia services the “most extensive network” with some 148 routes. Within 10 years of operations, AirAsia has carried more than 140mn passengers, he said. AirAsia has established operations based in Malaysia, Indonesia, Thailand and the Philippines, servicing a network stretching across all Asean countries, China, India, Sri Lanka and Australia.

Tuesday 14 February 2012

AirAsia’s First Big Sale for 2012! Fly as low as RM19*

Sepang, 14 Feb 2012 – Staying true to its tagline, ‘Now Everyone Can Fly’, AirAsia, the world’s best low cost airline is having its first awesome Big Sale this year across both AirAsia and AirAsia X’s route network with all-in fares from as low as RM19 one way.

The Big Sale will be from 15 – 19 February 2012, and guests will be able to travel from 11 September 2012 to 31 January 2013 with these ultra low fares which are available online at www.airasia.com and all of AirAsia’s mobile booking platforms.
All-in-fares are from RM19 one way to domestic destinations such as Alor Setar, Penang, Langkawi, Kota Bahru while flights to East Malaysia cities such as Kuching, Bintulu, Sibu and Miri only costs from RM29 one way.
Guests can also travel to popular destinations such as Bali, Phuket, Singapore and Ho Chi Minh City from only RM49, and other picturesque destinations such as Hanoi, Da Nang and Siem Reap from RM89. And from as low as RM139 one way, guests can also travel to Guangzhou, Hong Kong, Macau, Guilin, Shenzhen, Colombo and more.
Guests may take advantage of this Big Sale and fly long-haul with AirAsia X from as low as RM 169 one way to Japan (Osaka, Tokyo) and China (Hangzhou, Tianjin, Chengdu).
Fares from as low as RM199 one way to Korea (Seoul), Taiwan (Taipei) and to the land down under (Perth, Gold Coast, Melbourne) which also includes AirAsia X’s most recent destination in Australia – Sydney are also up for grabs.
In addition, guests may have the luxury of flying long-haul with extra comfort on AirAsia X’s Premium flatbeds one way from as low as RM 949 to China (Chengdu, Huangzhou, Tianjin) and from RM 999 to Australia (Sydney, Perth, Gold Coast, Melbourne), Taiwan (Taipei), Korea (Seoul) and many more X-citing destinations.
Kathleen Tan, AirAsia’s Regional Head of Commercial said, “AirAsia has been having our Big Sale for nearly six years now, with approximately one million promo seats each time.
This would mean millions have enjoyed traveling with us to our extensive route network throughout the years at unbeatable low fares, which has now reached 152 routes, 23 countries and 13 hubs across Malaysia, Thailand, Indonesia, Philippines, Singapore and Hong Kong (both are virtual hubs).
This Big Sale offers all-in-fares from RM19 one way, and guests should not miss out on this great opportunity to plan their year-end and 2013 new year holidays, especially to some of the new destinations that we have added such as Semarang, Surat Thani and Chongqing.”
Guests are strongly encouraged to book their value-added services such as Baggage Supersize, Hot Seats, Pick-A-Seat, AirAsia Insure and in-flight meals online together with their flights as they are able to save up to 30%.
“At AirAsia, we understand that the Big Sale is an anticipated event by all our guests, and this time around, we have one million seats on sale to all the destinations that we fly to as a group across all four airlines (Thai AirAsia, AirAsia Indonesia, Malaysia AirAsia and AirAsia X).
Seats will be snapped up like hot cakes, as there is something for everyone.
It doesn’t matter if you are a golfer, history buff, foodie, diver, beach bum, shopaholic or just planning a business trip, there is an AirAsia destination for you,” added Kathleen Tan.
Azran Osman-Rani, CEO of AirAsia X said, “With the Big Sale offer, guests from AirAsia X destinations will be spoilt for choice.
This is definitely an opportune time for our guests to plan their multi-destination travel via our strong feeder network in South East Asia and beyond.
Guests from Australasia, China, Taiwan, Japan and Korea where AirAsia X flies to may connect from its Kuala Lumpur hub to various exotic destinations such as Bali, Phuket, Bangkok, Siem Reap, Ho Chi Minh and many more at X-traordinary low fares.
Guests may also take advantage of our fly-thru services for a seamless travel experience.”
To compliment your flight bookings, AirAsiaGo will also be offering hotel packages from as low as RM89 for a 3D/2N stay with return flights and all taxes included to hot destinations such as Penang, Kota Kinabalu, Guangzhou, Guilin, Hangzhou, Medan, Bandung, Bali, Jakarta, Bangkok, Phuket and many more at www.AirAsiaGo.com.
AirAsiaGo, in a partnership with Expedia, has over 145,000 hotel partners worldwide, and provides guests with a wide variety of options for tours and activities as well.
For guests who are looking for immediate travel in the next few months, AirAsia is also running a ‘2 To Go’ promotion to destinations such as Hangzhou, Chengdu, Tianjin, Singapore, Colombo, Bangkok, Chiang Mai, Yogyakarta, Penang and many more with all-in-fares for two persons from as low as RM78 one way.
AirAsia X is also offering special promo fares for immediate travel from RM199 one way to destinations in Australia, Japan, Korea, Taiwan and many more.
Both of the promotions’ booking period are from 15 – 26 February 2012, and guests are able to travel immediately from 22 February – 30 April 2012 which are available on www.airasia.com.
Effective 8 February 2012, guests who use the BIG prepaid Visa card as a payment method will be exempted from processing fees for online bookings with AirAsia.
This feature is currently only available for members with valid Malaysian mailing address.
Earn BIG Points every time you spend with AirAsia and other BIG partners worldwide to redeem free flights with the world’s best low cost airline.
Guests can sign up for BIG at www.tune2big.com.
Get tips and tricks on how to grab your Big Sale seats at AirAsia’s social media channels by following them on Twitter (twitter.com/AirAsia) and Facebook (facebook.com/AirAsia) apart from getting the latest promotion updates and other AirAsia activities.
*All fares quoted are all-in fares, inclusive of airport tax and fees for one way only

===========================================
INFOS:
Thai AirAsia,
AirAsia Indonesia,
Malaysia AirAsia,
AirAsia Philippines
and AirAsia X

Saturday 11 February 2012

Tune Hotel Pattaya Launches 199 Baht Promotion; Opens 17 February 2012

http://www.asiatraveltips.com/news12/82-TuneHotel.shtml

Tune Hotels will open the doors of the 192-room Tune Hotel Pattaya on 17 February 2012.
To celebrate, Tune Hotels is offering guests rates that start from just 199 Baht per night.
The rooms are open for sale between 10-17 February 2012 for travellers booking stays in Tune Hotel Pattaya from 17 February up to 5 April 2012.
Terms and conditions apply.
Including Pattaya, Tune Hotels now operates 16 hotels globally - ten in Malaysia; two in Bali, Indonesia; two in Thailand and two in London, England.
Adding to that list will be three locations in the Philippines – Angeles City (10 Feb 2012), Cebu City (24 Feb 2012) and Ermita, Manila (9 March 2012).
Tune Hotels’ first property in Thailand opened in Hat Yai in December 2011.
Group CEO of Tune Hotels, Mark Lankester, said, “The opening of Tune Hotel Pattaya marks a crucial point of Tune Hotels’ expansion in Thailand.
It verifies our strong commitment towards Thailand and its tourism industry.
This follows the successful opening of Tune Hotel Hat Yai, and with more Tune Hotels coming up in Thailand we are proud to be playing an even bigger role.”
Adding to its 16 properties currently will be another 30 hotels scheduled for opening this year in the Philippines, Thailand, Indonesia and the UK.
Tune Hotels has collaborated with the Bangkok-based Red Planet Hotels for the development of Tune Hotels in Thailand, the Philippines and Indonesia.
Red Planet Hotels CEO Tim Hansing said, “Tune Hotel Pattaya will be one of the busiest hotels in the network, so we don’t expect these great promo rates to be available for long but there will be more chances for travellers who love the brand to take advantage more great value rates across the network as the year goes on.”
Tune Hotel Pattaya is located on the beach resort’s bustling Second Road, just minutes from the beach, shopping, entertainment and nightlife.

Battle of low-cost carriers

Battle of low-cost carriers
Saturday, 11 February 2012 18:37
Lenie Lectura / Reporter

IT doesn’t take a genius to deduce that the presence of low-cost carriers (LCCs) has, indeed, heated up competition in the country to the benefit of passengers, of course.
Promo fares, heftier discounts for passengers with less or no carry-on baggage, and bundled air fare with hotel accommodation.
These are the irresistible come-ons to ticket buyers.
“In a country where people are frugal, they patronize the carrier that sells the cheapest fare. Consumers are wise nowadays.
They research via the Internet to scout for the most affordable fare and even make comparisons just so they can be sure that they are availing themselves of the best deal,” said Carmelo Arcilla, executive director of the Civil Aeronautics Board (CAB).
A low-cost carrier is an airline that generally has lower fares but fewer comforts; no food is served on board, for one.
However, fares are definitely cheaper by thousands of pesos.
That’s why Cebu Pacific, Airphil Express, Zest Air and Seair are often referred to as no-frills, budget carriers.
To make up for revenue lost in lower ticket prices, the LCC may charge for extras like food, priority boarding, seat allocating and baggage.
Arcilla said the LCC penetration rate in the country is currently pegged at 85 percent, led by Cebu Pacific and Airphil Express.
He noted that the penetration rate of domestic LCCs is much higher than in other emerging markets.“Certainly, the LCCs dominate the market.
Their presence stimulates the travel appetite of Filipinos who are sensitive to prices,” said the CAB official.
Rock-bottom fares
CEBU Pacific resumed offering its P1 seat sale in a bid to help promote the country’s tourism industry.
The P1 fare is exclusive of government tax and fuel surcharge but applies to all of the airline’s 18 international and 34 domestic destinations.
“It has always been fun for us at Cebu Pacific to give away seats at P1, because more local and foreign tourists get the chance to explore the Philippines on our trademark lowest fares.
With this unbeatable travel deal, passengers can spend their airfare savings on more adventures,” said Candice Iyog, Cebu Pacific vice president for marketing and distribution.
The airline posted a seat sale teaser with the words “We’re the #JuanforFun” on its official Cebu Pacific Air Facebook Fan Page and @cebupacificair Twitter account on January 19.
The teaser was inspired by the Department of Tourism’s national initiative “#1FORFUN,” with a call to stay tuned for the seat sale’s launch.
The tickets for the P1 fare are valid from June 1 to December 15 of this year.
Cebu Pacific’s P1 fare promo was introduced in 2007 and has since become extremely popular.
Cebu Pacific, which is operated by listed Cebu Air Inc., is the listed airline of JG Summit Holdings Inc. of the Gokongwei family, which has interests in telecommunications, banking, hotels and food manufacturing, among others.
Airphil Express, the budget airline which is 99-percent owned by the Lucio Tan group and Philippine Airlines’ (PAL) sister company, has posted on its web site a list of its year-round promo. Their seat sale includes P1, P8, P88, P488 and P888 promos.
Airphil Express seeks to increasingly corner a considerable share of the budget-airline market by offering travelers with compelling value propositions.
Among these is the “free 15-kilo check-in luggage allowance plus seven-kilo hand-carry baggage” that used to be standard among budget carriers.
It also offers a 20-percent discount to students.
Moreover, it recently launched a customer loyalty program where loyal Airphil Express travelers can receive a free ticket after logging in 10 trips under the program.
PAL, on the other hand, is not a budget airline but it does offer promo fares from time to time.
It had just launched its Valentine’s Day promo offer dubbed as “Let Your Love Fly Free.”
Under the promo, the passenger will need to buy a regular-priced business-class ticket to avail himself/herself of another one for free.
The promo is from January 17 to February 13, and is valid for travel from January 23 to March 31.
The promo is available on the following PAL routes: San Francisco and Los Angeles in California; Las Vegas, Nevada; Honolulu; Guam; Hong Kong; Macau; Taipei, Taiwan; Bangkok, Thailand; Singapore; Ho Chi Minh, Vietnam; Jakarta; Malaysia; Xiamen, Shanghai and Beijing in China; Delhi, India; Tokyo, Nagoya, Fukuoka and Osaka in Japan; Sydney and Melbourne in Australia.
For domestic destinations, PAL’s promo applies to the following: Laoag, Legazpi, Puerto Princesa, Bacolod, Cebu, Dumaguete, Iloilo, Kalibo, Roxas, Tacloban, Tagbilaran, Butuan, Cagayan de Oro, Cotabato, Davao, Dipolog, General Santos, Ozamiz and Zamboanga.
The airline earlier reported that its December 2011 bookings increased by 23 percent, driven by a 27-percent increase in international bookings.
“Even if we are not a budget airline, we still offer affordable rates,” said PAL President Jaime Bautista in an interview.PAL is 95-percent owned by tobacco and beer magnate Tan.
The rest of the LCCs—Seair and ZestAir—also offer competitive rates.
More affordable rates are even offered if an airline has to fly out of Clark. Domestic air travel on the rise
THE successful take-up of promo airfare has, indeed, lifted passenger count.
Based on latest figures provided by the CAB, domestic air travel in the country continued to soar at end-September last year mostly because of the price war among the LCCs.
The CAB said domestic passengers rose by 14.3 percent to 14.03 million in the first nine months of the year from 12.28 million in the same period last year.
The airlines’ seat capacity grew 16.42 percent to 18.01 million from last year’s 15.47 million, resulting in an average passenger load factor of 76.6 percent.
Arcilla said the industry’s increasing load factor reflects a steady growth in passenger demand.
Cebu Pacific carried 6.17 million as against PAL’s 3.4 million.
The Gokongwei-led airline had a load factor of 81 percent during the period, against PAL’s 75 percent.
Airphil Express, the country’s fastest-growing airline, flew 2.72 million passengers, up 142.86 percent from 1.12 million last year.
Alfredo Herrera, Airphil Express senior vice president for marketing and sales, said the huge increase in passengers was driven by the airline’s competitive fares and increased capacity.
He said the airline has been successful in snatching passengers from rivals, while gaining new travelers.
Airphil had predicted it would end 2011 with more than 4 million domestic and international passengers.
ZestAir, meanwhile, recorded a total of 1.58 million passengers, higher than last year’s 902,935, while Seair suffered a decline to 115,525 from 159,086.
Foreign LCCs give local airlines a tough fightTHE air fare rates “war” could further heat up competition among the LCCs with the entry of foreign LCCs such as AirAsia Philippines Inc. and the joint venture between Tiger Airways and Seair.
Recently, the CAB granted seat entitlements to AirAsia and Seair for flights between Clark and destinations in Malaysia.
“The LCCs are expanding. Foreign or local, both are eager to serve not only the domestic market but regional markets as well,” said Arcilla.
“As such, local airlines should adjust so they can withstand the onslaught of the new carriers.”
AirAsia awaits a permit from the Civil Aviation Authority of the Philippines (Caap) before it can launch its maiden flight.
Its main hub of operation is at the Diosdado Macapagal International Airport in Angeles City, Pampanga.
One of the airline’s investors, Antonio Cojuangco Jr., said AirAsia will give Philippine budget airlines a tough competition by offering fares that are cheaper than Cebu Pacific’s.
“Yeah, that’s our motto.
Lower than existing market,” he said.
Expansion not only covers additional destinations but also growth in fleet, added the CAB official.
AirAsia plans to buy as many as 10 aircraft in the next three years.
Two, said Cojuangco, arrived last year.
When asked of the airline’s plans in terms of acquiring more aircraft, Cojuangco said, “We have plans but all of these are subject to what we can actually achieve.
Best-case scenario, in the next three years, we may have eight to 10 planes.
All Airbus,” he said.
Seair, meanwhile, will use Airbus 319s and 320s for its planned new international destinations.
At present, Seair flies to Singapore, Hong Kong and Macau from its hub in Clark, using two Airbus planes leased from Tiger Airways.
Moreover, Seair would be tapping the reservation system of Tiger Airways for its marketing and booking needs.
Seair will also use aircraft from Tiger Airways for domestic flights to Cebu and Davao. The CAB recently lifted the cease-and-desist order (CDO) it issued on these two routes because of alleged cabotage violation.
PAL, Cebu Pacific and Airphil Express complained that mounting these routes rules violated cabotage rights.
Such rights, which involve the transport of goods and passengers between two or more points within the Philippines, are only for domestic airlines.
Local airlines feared that allowing Seair to fly these routes would, in turn, allow Tiger Airways to access the Philippine market and fly domestic routes.
“But the CDO had been lifted and we are ready to fly to these routes soon,” said Seair President Avelino Zapanta.
Seair and Tiger Airways launched flights to Singapore and to Hong Kong.
The CAB official added airlines are using Clark as jump-off points to take advantage of the rising regional travel demand. “These are flights that take no more than four hours.
Most of the budget airlines expand their presence in these routes,” Arcilla added. LCCs take caution against high fuel prices
THE vibrant budget-carrier sector continues to be plagued by spiraling jet fuel prices.Fuel accounts for 40 percent of an airline’s operating cost per passenger and is considered the second-highest next to labor.
That’s why airlines are allowed to seek upward adjustments in fuel surcharges before the CAB as a means of a temporary relief to help them recover losses they incur from higher jet fuel prices.
Last year, Cebu Pacific started recharging fuel surcharge of ticket holders.
It’s been two years since the Gokongwei-owned airline removed fuel surcharge in the ticket price of its domestic and international flight bookings.
The removal of the surcharges then allowed passengers to easily compare airfare with the fares of buses and ferries.
But the rising price of fuel in the world market is hurting airlines.
“We have to augment due to rising fuel costs.
We still have the lowest fares even with fuel surcharge since all other airlines are also charging the same fuel surcharge,” said Iyog.
Airlines seeking adjustment in fuel surcharge will have to pay P6,000 per application before the CAB.
Once approved by the CAB, the airlines are allo
wed to implement the new rate for the next three months.
Airlines hedge their fuel requirements.
This means that they buy their fuel requirements at almost 60 percent in advance at a fixed price.
Arcilla said LCCs are able to shield themselves from high operating costs, particularly on fuel, simply because they have to.
“They find ways to cut costs.
As LCC, they should operate efficiently by improving their turnaround time so that no fuel is wasted.
So, they purchase fuel-efficient aircraft,” he said.
“There is an impact on our bottom line but we are managing it,” said Iyog.
Recently, Cebu Pacific announced it will be leasing up to eight Airbus A330-300 aircraft to serve long-haul routes in the third quarter of next year.
This type of aircraft is more fuel efficient, it said.
Cebu Pacific expects to end the year in the black, but cautioned against fuel prices that will still affect the firm’s profitability.
Its nine-month net income declined by 54 percent to P2.22 billion in January to September 2011, as the increase in revenues was not enough to cover the rise in expenses.

AirAsia signs at Davao Airport

AIRASIA: GENERAL ANNOUNCEMENT

08-Feb-2012 Reference No CM-120208-65703
Company Name: AIRASIA BERHAD
Stock Name : AIRASIA
Date Announced: 08/02/2012
Type: Announcement
Subject: OTHERS
Description:AIRASIA BERHAD
UPDATE IN RELATION TO PHILIPPINES JOINT VENTURE

Announcement Details/Table Section :

Further to the announcement dated 16 December 2010 in relation to a joint venture in the Philippines between AirAsia Berhad ("AirAsia" or “the Company") through its wholly-owned subsidiary AirAsia Investment Ltd. (formerly known as AA International Ltd) and Antonio O. Cojuangco Jr., Michael R Romero and Marianne B. Hontiveros, the Company is pleased to announce that the joint venture entity incorporated by the parties to establish a low cost airline in the Philippines, AirAsia Inc. (“AAI”) had on 7 February 2012 obtained an Air Operators Certificate (“AOC”) from the Civil Aviation Authority of the Philippines.The AOC shall enable AAI to operate aircraft in its fleet for commercial flights to international and domestic destinations. AAI’s first commercial flight is expected to commence in March or April 2012. This announcement is dated 8 February, 2012.

This report includes original source company information.

Tuesday 7 February 2012

AirAsia Philippines just added new destinations: Davao and Kalibo


Air Asia starts domestic operations next month
AIR Asia Philippines yesterday said that it will start its domestic operations next month with its new Airbus A-320 planes.
Air Asia also targets to beef up its fleet to between 14 and 16 aircraft in five years.
Marianne Hontiveros, chief executive officer of AirAsia Inc., said the local airline will be flying out of Clark to Davao on March 15 in time for Davao’s 75th founding anniversary, and from Clark to Kalibo.
Hontiveros said the airline company hopes to start its regional flights within the year, adding that it has already secured air rights for regional flights to Bangkok, Thailand, Singapore, Japan, China, Korea, and Taiwan.
However, she said that the airline still has to get seats from the respective countries after submitting the air operator certificate (AOC) which it just secured from the Civil Aviation Authority of the Philippines (CAAP) yesterday.
"We are excited to announce that in the coming weeks, AirAsia Inc. will begin its domestic and international operations utilizing two brand-new Airbus A-320s flown in from the Airbus factory in Toulouse, France," she said after the signing ceremony for its AOC.
The contract allows Air Asia to fly passengers from its hub in Clark to domestic and international destinations.She said two more aircraft will be delivered within the year.
Hontiveros did not disclose the amount of investment the company put in for the new fleet, saying the aircraft that will be coming are all leased.
"After we have started our operations, we will evaluate if we need to acquire our own aircraft," she said.
She added that Air Asia is ready for a price war, and assured that the carrier has the lowest airfares while offering the best service.
The airline company originally targets to carry around 850,000 passengers in its first year of operation.
This may be revised given the delays it has faced to secure the license to operate.
Ramon S. Gutierrez, Air Asia director general, said the company has successfully completed the five phases of certification.
Gutierrez expressed confidence that the rigid process and requirements that AirAsia Inc. has fully complied with will enhance a system of checks and balances to ensure safety conscientiousness in Philippine aviation.
"We reaffirm our commitment to make air travel more fun, affordable and accessible to all Filipinos. With the Diosdado Macapagal International Airport (DMIA) in Clark, Angeles, Pampanga, as our hub, we look forward to helping revitalize tourism and significantly increasing passenger traffic at DMIA," Hontiveros said.
AirAsia Inc. registered with the Securities and Exchange Commission in March last year to engage primarily in providing passenger and cargo air transportation in the Philippines and abroad.
AirAsia Inc. is a 60-40 joint venture between Filipino investors Antonio O. Cojuangco, Michael L. Romero and Hontiveros, and Malaysia’s AirAsia International Ltd., a wholly owned subsidiary of AirAsia Berhad.

Monday 6 February 2012

Local AirAsia unit set to bag key permit


“It (the permit) is tentatively scheduled to be given to AirAsia on Monday,” Ramon S. Gutierrez, Civil Aviation Authority of the Philippines (CAAP) director-general, told BusinessWorld in a telephone interview on Friday, referring to the air operator certificate.
The carrier, a joint venture between the Malaysian-based carrier, which owns 40%, and Philippine businessmen Ms. Hontiveros, Antonio O. Cojuangco III, and Michael L. Romero, had planned to commence operations as early as October last year but failed to do so, pending the receipt of the necessary permits from regulators.
AirAsia Philippines in August last year had already received a temporary operating permit from the Civil Aeronautics Board, however, the carrier had yet to receive the air operator certificate.
The application process takes a long process as airlines are required to submit data on its aircraft, proposed initial training for crew, documentation of maintenance system, among others, Mr. Gutierrez explained.
CAAP had to review the documents submitted as well as conduct an inspection of the airline’s facility as part of the process for granting an air operator certificate, he added.
“Now we have already scheduled granting the approval to AirAsia,” Mr. Gutierrez said.
AirAsia Philippines declined to comment pending actual receipt of the permit.
But it has slated a briefing with the press today for the announcement.
The firm’s entry poses competition to local carriers Cebu Air, Inc. and Philippine Airlines which likewise operate routes from the Philippines to elsewhere in the region.
Last year, the carrier’s first aircraft, a 180-seater Airbus A320, arrived at its hub in Clark.
Its second aircraft, meanwhile, was delivered later in 2011.
Marianne B. Hontiveros, chief executive officer, had said then that the carrier plans to use the first plane to fly to Singapore, Hong Kong and Macau.
Aside from the three international destinations, the carrier plans to fly to Kalibo in Aklan province, Puerto Princesa in Palawan province, Incheon in South Korea, and Bangkok in Thailand.
In the last quarter of 2011, AirAsia Philippines had been granted rights by the CAB to Malaysia, Cambodia, and Japan.
The carrier was granted 1,260 seats a week on the Clark to Kuala Lumpur route, CAB has previously said. It was also granted seven flights per week on the Clark to Cambodia route.
Moreover, AirAsia Philippines was granted six flights per week that it can utilize either on the Clark-Osaka route or Clark-Nagoya route.
AirAsia Philippines, which hopes to have a fleet of 14 or more aircraft in about four years time from 2011, is expecting the delivery of another two aircraft this year, Ms. Hontiveros said.
The carrier unveiled plans for a $25-million capital expenditure in December 2010.
Its parent has been flying to the country since 2005 from Kuala Lumpur and Kota Kinabalu. -- Kathleen A. Martin

Thursday 2 February 2012

AirAsia Japan received Air Operators Certificate

Published by Ozgur Tore
Thursday, 02 February 2012 15:48

AirAsia Japan Co., Ltd., announced today that it has received Air Operators Certificate, required by the Civil Aeronautics Act, from the Civil Aviation Bureau of the Ministry of Land, Infrastructure, Transport and Tourism.

AirAsia Japan carries on preparations including training on flight crew, flight attendants, engineers and guest service staff for its commencement of domestic flight service in August 1,2012 followed by international flight service in October 1,2012.

Kazuyuki Iwakata, CEO of the airline said, “We have achieved a big step to make our ideal “Now, everyone can fly” where everyone can enjoy flights easily at any time come true.

We are accelerating our preparation for inauguration in August and hope to welcome our guests as early as possible in the Sky of Japan.”

Tony Fernandes, Group CEO, AirAsia said, “We announced the establishment of AirAsia Japan in July last year, and it is great to see the progress of preparations that are in place for our operations in just a few months.

I strongly believe in the Japanese market, where low cost travel is still a new concept to many and the potential of this new market excites me.

We are doing good progress and hopefully come this August, the Japanese will have a brand new experience to talk about in both the aviation and travel industry.”Shinichiro Ito, Group CEO, ANA said, “This is a start of a new age in Japanese aviation history with a fully-fledged low cost carrier beginning operations in the largest aviation market in this country this year for the first time.

We aim to generate new demand in this industry together as a whole. ANA believes that AirAsia Japan will make air transport more accessible and provide a convenient and efficient travel option for a wide range of people.“

AirAsia Japan received Air Operators Certificate from Japan Civil Aviation Bureau


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