The Malaysia-based long haul low cost affiliate of AirAsia has suspended services to four cities - Mumbai, New Delhi, Paris, London - due to global economic uncertainity, soaring taxes and higher jet fuel prices. It however has added the much-prized Sydney to its network (read Update below).
The affected services from its Kuala Lumpur hub are:
• Mumbai: Four weekly services, last flight on January 31, 2012
• New Delhi: Daily services, last flight on March 22, 2012. Flights in March will be reduced to four weekly services.
• London: Six weekly services, last flight on March 31, 2012
• Paris: Four weekly services, last flight on March 30, 2012
AirAsia X will offer its guests, who hold bookings after these dates, an alternative travel option at no additional cost.
All affected guests will receive an email stating options that are available to them, including a full refund, a reroute to another AirAsia X destination (e.g, in Australia and North Asia), or a move to an alternative carrier where available.
Azran Osman-Rani, AirAsia X CEO (pictured below), said these changes would improve operating cost efficiencies and consolidate its network to focus on markets where it could build a leadership position this year.
"We intend to concentrate capacity in our core markets of Australasia, China, Taiwan, Japan, and Korea where we have built up stable, profitable routes within an infrastructure that supports low cost services."
The airline also plans to open up new routes within these markets, as well as add frequencies on existing routes.
Azran said the continued high jet fuel prices and the weakening demand for air travel from Europe, due to the current economic situation and exorbitant government taxes, have placed cost pressures on operating long haul low cost flights between Asia and Europe, thus compromising the airline’s ability to offer low fares.
"The implementation of the Emissions Trading Scheme and the escalating Air Passenger Duty taxes in UK, which will rise yet again in April 2012, has forced our decision to withdraw our services to Europe,” he added.
Factors behind the airline's move to suspend services to New Delhi and Mumbai are visa restrictions between India and Malaysia, and increased airport and handling charges. They have resulted in a structure not conducive to the low cost model.
"The airline is hopeful in reinstating services to India once these structural issues can be resolved."
AirAsia X started flights to London in March 2009, and to Mumbai and Delhi in 2010.
We understand from sources that this latest realignment exercise is part of a development resulting from the shares swap between national carrier, Malaysia Airlines (MAS), and AirAsia on August 8 last year when both companies decided to work together instead of competing. The four axed routes are said to go to MAS, which in turn would hand over one of its twice daily much prized Kuala Lumpur-Sydney service to AirAsia X.
It is no secret that AirAsia X has been fighting for the rights to fly the lucrative Sydney route for more than three years, with its bid consistently blocked, ironically, by MAS. But the share-swap agreement has changed the entire situation.
Sydney will be the “jewel in the crown” for AirAsia X even though it is flying to three destinations in Australia namely Perth, Melbourne and the Gold Coast.
The airline declined to comment on a report in The Star that quoted an unnamed airline official as saying ticket sales for the Kuala Lumpur-Sydney route would start next week. The first flight is slated for April 1, which will give it a head start on Scoot, Singapore Airlines’ budget long-haul carrier, which has named Sydney as its first destination out of the Lion City with plans to fly the route by mid-year.
Sydney here we come!
As speculated, AirAsia X has clinched the “jewel in the crown” of Sydney as its fourth destination in Australia.
The airline launched the daily Kuala Lumpur-Sydney route on January 17 at the Museum of Contemporary Art Centre in Sydney, less than a week after announcing the axing of routes to India and Europe.
The inaugural flight, which takes off on April 1, offers a one-way fare of RM199 (US$64) economy, the lowest fare ever offered to Sydney by air from the Malaysian capital.
Fares for Australians flying into Kuala Lumpur will start from A$99.
Azran Osman-Rani, AirAsia X chief executive officer, said the low-cost long-haul airline expects to see revenue of RM16 million in its first year of operations into the Kuala Lumpur-Sydney route.
Photo: Azran (right) in a Bondi lifeguard uniform with Hoppo, a lifeguard from hit reality TV series Bondi Rescue, flanked by flight attendants.
He added that the airline is already looking at Adelaide as the next city for its expansion in Australia. Talks on this are only at the preliminary stage and it will not happen this year but in 2013.
Sydney too has high hopes for the new service, forecasting it to generate about 55,000 more international visitors to New South Wales annually.
Destination NSW chief executive officer, Sandra Chipchase said the NTO, in conjunction with Sydney Airport, Tourism Australia and AirAsia X, would be investing in a two-year marketing and promotion plan for the new Kuala Lumpur to Sydney route.
The service will be operated on the Airbus A330-300 aircraft with a configuration of 12 Premium fly flatbed seats and 365 economy seats.
• Photos courtesy of AirAsia X