AirAsia prepared to invest in airports to boost traffic

AirAsia prepared to invest in airports to boost traffic

Tony Fernandes says AirAsia is big enough to have its own terminals.
Tony Fernandes says AirAsia is big enough to have its own terminals.

No-frills airline group AirAsia appears eager to invest or become a joint-venture partner in airport development to serve its burgeoning traffic and drive overall air travel demand.

Group chief executive Tony Fernandes yesterday made the proposition as he urged airport authorities in Asean to change their mindset to support low-cost carriers (LCCs) by lowering airport-related charges.

A partnership or joint venture with airport authorities by Asia's largest LCC group could be an answer if capital requirement is an issue, he told the CAPA LCC Airports Congress in Bangkok.

"We're big enough, and I don't see why we should not have our own [passenger] terminals," he said.

Thai AirAsia's board would have to decide whether to pursue the idea, but if Malaysia AirAsia was given an offer from Malaysia Airports Holdings today, it would do so tomorrow, Mr Fernandes said later.

AirAsia has long been keen to have its own terminals, but bids in recent years to invest in such facilities in Malaysia and Indonesia were foiled by authorities.

Nitinai Sirismatthakarn, president of Airports of Thailand Plc, yesterday told reporters two funding schemes for expanding aprons at Bangkok's Don Mueang airport were under consideration -- creating an infrastructure fund or allowing joint-venture partners.

At the conference, Mr Fernandes criticised Asean airports for lagging behind airports in Japan, China and Europe in supporting LCCs in driving traffic through airports by offering incentives.

"Japan and China are very proactive. Here in Asean, we talk, we fight, and at the end people don't benefit," the AirAsia boss said.

In his address, he said: "For airports to overcome the challenges of the 21st century and prepare for Asean Open Skies, we need a mindset change with regard to aviation policy."

What LCCs need are airport terminals that meet the needs of the LCC business model, plus the implementation of a fair incentive scheme for all airlines.

Lowering the passenger service charge (also known as an airport tax) and airport charges for landing and parking would allow LCCs to reduce fares, spurring passenger volumes that would benefit the entire chain of the travel industry, Mr Fernandes said.

Supporting LCCs would allow Asean to tap the potential of raising international arrivals to the region to 163 million and increasing tourism revenue to US$202 billion by 2025.

Mr Fernandes has long campaigned for Thailand to lower airport charges. He has advocated that Don Mueang's charges should be benchmarked with those of Kuala Lumpur International Airport 2, which opened last year to serve LCC flights.

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