AirAsia's Fernandes Says It'd Be 'Foolish' Not to Consider C919

  • Carrier predicts rest of 2017 to be better than last year
  • Chinese venture to focus on new markets, build new business

AirAsia Forecasting Rest of Year to Be Better Than 2016

AirAsia Bhd., the low-cost carrier that flies only Airbus SE planes, would consider using newly developed aircraft such as the Chinese-made C919 as the airline expands its fleet and destinations.

“I think as an airline you have to look at everything,” AirAsia Group Chief Executive Officer Tony Fernandes said in a Bloomberg Television interview, when asked whether the carrier would consider the C919. “We will be foolish not to look at new planes.”

Fernandes talks to Bloomberg TV.

Source: Bloomberg

Willie Walsh, chief executive officer of IAG SA, the owner of British Airways, has said the company would consider the Chinese-made aircraft. Commercial Aircraft Corp. of China Ltd., the planemaker, has commitments from 23 customers for about 570 of the C919, which took its maiden flight on May 5.

AirAsia made a key advancement in its goal to create a pan-Asian low-cost airline this month, when he announced a partnership with China’s Everbright group to create a budget airline in the country. Fernandes is predicting the rest of 2017 will be better than last year, after the company posting a 30 percent drop in first-quarter net income, saying the competitive environment is improving.

“We are seeing much better load and yields in the second, third and fourth quarter,” Fernandes said in the interview with Haslinda Amin. “So, 2016 was a record year. We think 2017 will be better than 2016.”

Net income in the first three months of 2017 fell to 615.8 million ringgit ($144 million) from 877.8 million ringgit a year earlier, AirAsia reported Thursday. The carrier also said it plans to add 29 planes for a total of 201 by the end of this year.

The C919 aircraft

Photographer: Qilai Shen/Bloomberg

The Chinese venture will be based in Zhengzhou, the capital of central Henan province. While Fernandes declined to identify specific routes for the Chinese venture, he said the carrier would focus on markets where it can grow and would “never go to Shanghai, Beijing.”

“We don’t want to disrupt existing markets,” the executive said. “We want to create new markets and build new business. That’s what AirAsia has been good at.”

— With assistance by Karolina Miziolek, and Haslinda Amin

    Before it's here, it's on the Bloomberg Terminal. LEARN MORE