AirAsia X Bhd will return to the black in the second half of the year as its aggressive expansion into North Asia reaches the average 12-month breakeven point, said chief executive officer Azran Osman-Rani.
On Tuesday, the long-haul, low-fare airline affiliate of the AirAsia Group signed a memorandum of understanding for 50 A330neo aircraft valued at US$13.8bil (RM44.16bil) with Airbus. Signed at the Farnborough International Airshow, this is the world’s first airline commitment for the new version of the A330neo launched by Airbus this week.
In this landmark deal, AirAsia X will be the launch customer and the delivery of the A330neo will take place between late 2017 and 2024.
The A330neo incorporates the latest-generation Rolls-Royce Trent 7000 engines and reduces fuel consumption by 14% per seat, making it the most cost-efficient, medium-range widebody aircraft in the market.
A clearly happy Tan Sri Tony Fernandes, who is AirAsia X co-founder and director, said Airbus really did listen to its customers.
“We have been encouraging Airbus to launch this new version of the A330 for some time now. They said no. But for those of you who know AirAsia, you know we don’t take ‘no’ for an answer,” he said.
“This deal really is amazing for a Malaysian company. Airbus listened to us and is building this plane for us. The A330neo has a more efficient burn rate. This is the aircraft we truly need to develop further our low-cost, long-haul model. We are 100% sure that the A330neo will be quite unbeatable in its size category,” said Fernandes.
With this deal, the AirAsia Group has ordered a total of 586 aircraft from Airbus, making it one of Airbus’ biggest customers.
Azran said that in a nutshell, the A330neo was a game-changer for AirAsia X, as the cost efficiency doubled to 26% for longer-haul flights, for example, to Europe.
“Yes, we will definitely be studying the viability of Europe. The A330neo certainly makes it more feasible. For the nearer term, the China market is looking very good. Our focus continues to be on North Asia and Australia,” said Azran.
On AirAsia X raking in a profit soon, Azran said that while AirAsia X had been recording losses, it was mainly due to start-up investments from its aggressive expansion to increase market share for its operations.
Azran added that not all the A330neo were for expansion, and some would be to replace AirAsia X’s older planes. At present, AirAsia X has 23 planes and will take delivery of between seven and eight planes yearly.
AirAsia X started operations in Thailand earlier this year. For the first three months, it recorded a load factor of 88%. Azran said AirAsia X’s Indonesian affiliate will start operations later this year.
On the same day, AirAsia was named the “World’s Best Low-Cost Airline” at the 2014 World Airline Awards, making it the sixth consecutive year it has won the award.
“When it comes to low-cost carriers, Malaysia is the best in the world,” said Fernandes.
Not to be left behind, AirAsia X was hailed as the “World’s Best Low-Cost Airline – Premium Class Seat” and the “World’s Best Low-Cost Airline – Premium Cabin” award winner at the awards.
