AirAsia Statement: AirAsia’s cost containment drive aims at minimising impact on employees

SEPANG, 9 March 2020 - As the global air transport industry continues to face uncertainties in light of the Covid-19 outbreak, AirAsia Group has put in place a variety of cost containment measures across all its business operations with an emphasis on minimising impact on its employees, while ensuring business continuity with a priority on flight operations safety and security.

Acting CEO and President (Airlines) of AirAsia Group, Bo Lingam said: “Containing and managing costs has always been in our DNA as a low-cost carrier and this is the one quality that sets us apart from our peers. Commencing business just months after the 9/11 New York World Trade Centre tragedy in 2001, AirAsia took the travel industry by storm by introducing a low-cost business model that allows everyone to fly on low fares. The SARS epidemic in 2002, H1N1 (2009), Ebola (2014), MERS-CoV (2015) coupled with multiple incidents of tsunami, volcanic eruptions, earthquakes, floods and the seasonal typhoons in between, have all dampened the travel industry but thanks to our resilience, cost discipline as well as contrarian marketing strategy, AirAsia has weathered all these storms and continued to chart positive passenger growths year by year.

“The Covid-19 that has led to travel restrictions and flight cancellations is no different. With the global economy already weakening over the past 18 months, the epidemic has only made it worse. AirAsia as an airline has definitely been impacted by the sharp slowdown in the past few months, as like many other carriers we have been forced to cancel many flights due to poor demand, not only for China routes but also other destinations. As a result, although we remain cash flow positive and can count on a working ancillary model, we have to be bold in finding ways to reduce cost, conserve funds and protect the future of our business.”

Bo assured that the cost containment measures would have zero or minimal impact on most AirAsia employees especially those in the lower-income bracket.

He added: “AirAsia continues to monitor the developments and employ aggressive marketing and education strategies to instil the confidence of flying back in the travelling community. To further spur local and regional tourism, capacity is now being redeployed to domestic and intra-Asean flights. We are also continuously engaging industry stakeholders and tourism authorities for incentives as well as marketing and promotional collaborations.”