Airasia X sees double-digit growth in revenue, volume
KUALA LUMPUR: Long-haul low-fare airline AirAsia X is looking at double-digit growth in 2013 and 2014 in revenue and passenger volume, supported by fleet expansion.
Chief executive officer Azran Osman-Rani was confident of the revenue and passenger volume growth, with the two components being proportionate to the number of planes the airline will have.
“We’re getting seven more planes this year and seven more next year, so there’s a significant double-digit growth this year and an even higher percentage in 2014,” he said. Currently, AirAsia X has 11 aircraft.
With the new low-cost carrier terminal KLIA2 opening in May, he foresaw a significant boost to AirAsia X, especially where reaping the benefits of having more interconnectivity at the terminal is concerned.
“In 2011, 45% of our business was from connecting passengers and we expect this percentage to grow as KLIA2 offers more connectivity,” he said at the launch of AirAsia X’s new route from Kuala Lumpur to Jeddah.
Co-founder Datuk Kamarudin Meranun told the media after the launch that the Middle East was a market to look at due to liquidity, as evidenced by the growing global sukuk market.
“That’s a market we cannot ignore although our focus is still on Asia. Jeddah is the best place to try out the Middle East market without incurring too high a risk,” he said, adding that AirAsia X could explore expanding into other destinations within that region.
On sister-company AirAsia Bhd’s reported launch of an Indian airline, Kamarudin said the group was always looking for opportunities all around Asia.
“We had a team that visited India and are seriously looking to start something, given that India is a market we know,” he said, adding that if anything came out of it, the focus would be on the south of India.
However, he declined to comment on Tune Insurance Bhd updates other than that its listing process was on track for the end-February target.
The Kuala Lumpur-Jeddah route is the 14th destination in AirAsia X’s network and the only one to the Middle East at the moment. It is expected to carry 50,000 passengers in the first twelve months of operation and contribute between RM8mil and RM10mil in revenue in 2013.
Azran said the route would not form the biggest revenue chunk of AirAsia X but flights to Saudi Arabia were expected to make up about 5% of its business this year.
“We have three flights per week to Jeddah at the moment but in May, we will add a fourth one when the new aircraft come in,” Azran said of the service that will commence on Feb 16.
He added that AirAsia X would not hesitate to open up more flights to Jeddah if the demand was encouraging, noting that demand was not only from Malaysia but from Indonesia as well. Saudi Arabia, incidentally, only liberalised its airways two years ago.