In light of the COVID-19 pandemic which has crippled air travel across the world, AirAsia may be looking to ground its airline business which makes up about 75 percent of the group’s revenue.
During a staff briefing recently, AirAsia founder Tan Sri Tony Fernandes said that the group’s focus between now and June was on deferring variable costs and minimising fixed costs which may include grounding of their fleet.
Fernandes added that opportunities would be found in the logistics and e-commerce sectors. As for the staff, the group’s founder said that they will be moving into more technical jobs through the group’s in house reskilling courses.
“I’m going to be pushing OURSHOP and Teleport a lot, home delivery and logistics are going to grow tremendously and we have the right infrastructure. We see great opportunities in logistics and e-commerce,” said Fernandes.
Teleport is the group’s logistics arm while OURSHOP is AirAsia’s e-commerce marketplace.
The move to switch towards the tech sector comes on the back of massive losses for the airline industry globally due to the coronavirus pandemic. Other local players in Malaysia such as Malaysia Airlines (MAS) and Malindo Airways have also responded to the crisis by meeting a raft of measures from trimming flight routes to slashing salaries across the board.
On Sunday (March 15), Malaysia’s Finance Minister Tengku Datuk Seri Zafrul Tengku Aziz met with several airline representative from AirAsia, MAS, Malindo, and MAS subsidiary Firefly to discuss financial aid.
During the meeting the group asked for a loan to help ease liquidity, said Fernandes.
AirAsia may not be able to retain all of its staff, but Fernandes said that the “No. 1 priority is to make sure we keep as many of you, if not all, in employment.”
Fernandes also mooted the possibility of an AirAsia- AirAsia X merger but didn’t go into detail, as well as a possible 70 percent capacity cut in India.