AirAsia launches local flights; wants to grow PH market

http://www.abs-cbnnews.com/business/03/28/12/airasia-launches-local-flights-wants-grow-ph-market

By Cathy Rose A. Garcia, ABS-CBNnews.comPosted at 03/28/2012 2:43 PM Updated as of 03/28/2012 3:15 PM

CLARK, Pampanga - AirAsia's Philippine unit is challenging the dominance of low-cost carriers in the country, as it launched its first flights from Clark to Davao City and Kalibo, Aklan on Wednesday.

AirAsia Group CEO Tony Fernandes said the airline is not out to steal market share from other airlines, but to "grow the market" for the Philippines.

"We want to bring lots more tourists to the Philippines... AirAsia is not out to take away market share, but to grow the market.

We grew the market in Malaysia, and wherever we go, we grow the market," he said, in a press conference.

AirAsia is up against other budget carriers in the country, especially Gokongwei's Cebu Pacific and Lucio Tan's Air Philippines.

But its backers are not any less formidable: AirAsia Philippines is 60% owned by Marianne Hontiveros, Antonio "Tonyboy" Cojuangco and Michael Romero, with the rest owned by AirAsia Berhad (Malaysia).

Fernandes said AirAsia will be "like Jollibee," referring to the fast-food chain, in bringing more tourists to the Philippines.

"We believe the Philippines is ready to explode...

We told (Clark International Airport Corp. president) Victor Luciano, we're like Jollibee.

We will bring lots of people to his airport," he said.

Hontiveros, Philippines' AirAsia CEO, said the airline is looking to add two more planes as it looks to expand its domestic flights this year, and soon also regional flights.

"We started with domestic flights. We will soon launch regional flights.

We have applied for rights, but the approvals will come from the other side," she said.

AirAsia initially invested P468 million and currently has 2 brand new Airbus A320s.

It has ordered 2 more aircrafts, which will be delivered within the year.

The two main routes Clark-Davao and Clark-Kalibo were chosen because of their business and tourism potential.

"Our two maiden routes are Davao, the gateway to Mindanao and Kalibo is favorite destination of local and foreign guests because of Boracay," she said.

The first Philippines AirAsia flight PQ7001 left Clark for Kalibo at 7 a.m.

Another flight to Davao PQ7023 left at 10:10 a.m. on Wednesday.

Starting April 20, AirAsia will mount a daily flight to Puerto Princesa, Palawan.

Hontiveros promised AirAsia will shake-up the domestic airline industry.

Unlike other airlines that offer "cheap" fares but have hidden costs, Hontiveros said AirAsia is transparent and the only airline that offers "all-in" fares.

"We're different.

We want to be very open about our fares.

We are the only the 'all-in' fare, which includes the fuel surcharge, aviation fees, and service fees for credit cards and VAT.

We hope other carriers would follow our lead, so consumers know what they're paying when they see cheap and low fares," she said.

Hontiveros said that just because AirAsia is a low-cost carrier, it does not have to mean its cheap or uncomfortable.

She assured the airplanes are brand-new and offer "premium" service.

Fernandes, who founded AirAsia in Malaysia, said AirAsia offers not just low fares but its extensive network of flights from its other AirAsia units.

"Our connectivity is huge. You can visit 4 countries in one day," he said.

Renewed confidence in PHMeanwhile, Transportation Secretary Manuel Roxas, who spoke in behalf of President Benigno Aquino, thanked AirAsia for choosing the Clark as its operations hub.

He said AirAsia's move showed there is renewed confidence in the Philippines.

Roxas said the government is working on improving Clark International Airport, and working with the CIAC on a P360 million project to install baggage and pre-departure facilities.

He added a P12 billion budget terminal will also be constructed, which would be able to handle tens of millions of passengers annually.

Also Clark International Airport and Davao International Airport signed a sister-airport agreement on Wednesday.

The agreement is aimed at improving connectivity between the two cities.

"This will promote Davao as the next international hub in the Philippines.

The airport is not just a simple hub but can generate jobs and create economic activity...

The Clark-Davao flights open tremendous opportunities for Clark and Davao," CIAC's Luciano said.