Business

Thursday June 23, 2011

A ‘high day’ for AAX

By B.K. SIDHU
bksidhu@thestar.com.my


PETALING JAYA: AirAsia X (AAX), which got the go-ahead on Monday for five key international routes, will fly two within 12 months, according to chief executive officer Azran Osman-Rani.

Azran could not name the routes as the challenge now was to secure all the regulatory and airport authorities' approvals to enable AAX to land in the respective countries.

“We have to make sure we get the approvals and the readiness. It is manageable but we could not initiate it without the Malaysian government's approval,'' Azran said by telephone from Paris yesterday.

Earlier yesterday, AAX founder Tan Sri Tony Fernandes tweeted about the approval, saying that it was a “great day for AAX. The Government has removed all restrictions on routes. Only Sydney. Great, great day. Now we can go to Jeddah, Beijing, Shanghai, Osaka, Istanbul. The world has opened up. Thank you Prime Minister.''

The Transport Ministry had on Monday approved AAX's application for flights to Beijing, Osaka, Shanghai, Jeddah and Istanbul, but not the KL-Sydney route.

“We don't have the aircraft to immediately fly all the five routes. At most we can do two routes in the short term (12 months) with our current capacity. Beyond that we will have to wait for future plane delivery. We have ordered 17 (aircfaft) but this approval (of routes) is important as we can now find the routes for all of them.

“(Therefore) the approval means a lot to AAX and we thank the Government for it. We were hampered by optimal aircraft utilisation without the key route approvals and this approval will unlock the problem and pave the way for our potential IPO (initial public offering),'' Azran said.

“We also don't want our aircraft to wait and sit idly. But, with this approval, investors will now have more confidence in us (when we go for our IPO) and there will be economic-viable routes for the planes to fly.''

Azran said it was a positive development for the country as “we can now prioritise the very limited aircraft capacity that the country has access to on the most important routes rather than peripheral ones. This will help the Economic Transformation Programme achieve the tourism target that it had set.''

There are also conditions tied to the approval, but Azran merely said clarification was needed and he hoped to meet up with the Transport Minister at the Paris Air Show today.

Asked when the company was planning the IPO, Azran said “it was too early to say. We still need to get clarification from the ministry.''

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