Published On: Wed, May 16th, 2018

A storm breaks around AirAsia’s boss

“YOU only have one vote so use it wisely,” advised the captain of a lunchtime AirAsia flight from Singapore to Kuala Lumpur on May 9th. It was the third time he had reminded passengers of Malaysia’s election that day. Travellers delighted by the personal touch shook his hand as they disembarked.

The pilot was not freelancing. AirAsia had planned to provide 120 flights with reduced fares to help Malaysians get home to vote (in the end, half of the extra flights were approved by the airlines regulator). And the low-cost carrier’s political play went much further than encouraging people to vote. Tony Fernandes, the firm’s British-Malaysian boss, arranged for an AirAsia plane to be painted with the slogan of the ruling coalition of Najib Razak, the country’s prime minister at the time. Mr Najib duly posted pictures of it. Mr Fernandes also appeared in a video attributing the success of his business to the Malaysian government.

Then came the most astonishing political result in the country for 61 years. So on May 13th Mr Fernandes went in front of a camera again. He apologised for having “buckled” under pressure applied by the defeated administration of Mr Najib. “It wasn’t right and I will forever regret it,” he said.

Among the explanations he offered for his behaviour, one was that his industry is tightly regulated, meaning that his airline needs to be in favour with the government. Yet other carriers managed to stay out of the political fray. And according to one analyst, “Malaysia is no more regulated for airlines than many other South-East Asian countries”. Mr Fernandes may have hoped that he could improve AirAsia’s lot at Kuala Lumpur International Airport by buttering up those he assumed would win. Many of the firm’s operations are based at KLIA2, a dingy terminal with leaky loos and unappetising dining.

AirAsia’s operations in its home country are among its most lucrative, which explains why its boss is now desperate to appease Malaysians annoyed by his antics. (The firm’s share price still dropped by a tenth the day after Mr Fernandes’s contrite display.) For good measure, Mr Fernandes also threw some mud at the former administration, alleging that the Malaysian Aviation Commission pushed him to cancel the 120 flights for voters, perhaps because Mr Najib’s Barisan Nasional’s support is mainly in poor rural communities, so people flying in might have been more likely to vote for the opposition (the Commission denies having done this). Mr Fernandes also revealed that other officials wanted him to remove the chairman of AirAsia X, a long-haul service, for her criticism of the government. Investigations into the claims are planned.

The furore is unlikely to bother AirAsia, a hugely successful airline, for very long. Grown from the ruins of a state-owned firm which Mr Fernandes bought in 2001 for 1 ringgit (about $ 0.26 at the time), the AirAsia group, which includes six low-cost airlines, now has more than 200 planes carrying over 60m passengers annually. AirAsia itself made a profit of 1.64bn ringgit ($ 410m) last year, up very slightly from the year before. Customers in its many other markets, such as the Philippines, Thailand and Indonesia and Japan, care less about political vagaries in Malaysia than they do about cheap travel.

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A storm breaks around AirAsia’s boss