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  • AirAsia X set to amend debt revamp plan

    AirAsia X set to amend debt revamp plan

    AIRASIA X, the low-cost long-haul affiliate of AirAsia Group Bhd, is expected to file an amendment to its originating summons next week, to make its debt restructuring proposal more palatable to the 1,200 unsecured creditors that the airline is asking to write down their dues.

    This was disclosed to Kuala Lumpur High Court Judicial Commissioner Anand Ponnudurai by the lawyer for AAX last Friday (Oct 30). The matter came up before Anand at a case management hearing of an application by several of AAX’s unsecured creditors to intervene in the airline’s application for leave to hold a creditors’ meeting to vote on its proposed debt restructuring scheme.

    Sources say AAX seeks to amend its originating summons, as well as some of the terms of its proposed scheme. This comes as more lessors and creditors have come out against AAX’s proposed scheme that was disclosed on Oct 6.

    Under its proposed scheme, AAX is seeking to get at least 75% of the total debt value of its unsecured creditors to agree to take a 99% haircut, effectively cutting RM2 billion in current debts and another RM61 billion in future liabilities to RM200 million. It also entails undertaking a 90% share capital reduction to RM150 million from RM1.53 billion currently, and a consolidation of every 10 existing shares into one consolidated share.

    It is learnt that apart from airport operator Malaysia Airports Holdings Bhd (MAHB) and aircraft leasing company BOC Aviation Ltd, Macquarie Aircraft Leasing Services (Ireland) Ltd, Sky High I Leasing Co Ltd and three other creditors are the latest to file an intervention application for their objections to the proposed debt restructuring scheme to be heard. Oct 30 was initially the date of the hearing for AAX’s application for leave to convene the creditors’ meeting for purposes of voting on the proposed scheme.

    Sources say during the case man­agement hearing, AAX had no objections to the intervention application filed by the creditors, which means the concerned parties are allowed to intervene and take a position in terms of the proposed scheme.

    According to sources, Anand has also decided to recuse himself from the case, as he had previously appeared on behalf of AirAsia in its dispute with MAHB and the Malaysian Aviation Commission before he was pulled from private practice into the judiciary last November.

    It is understood that another case management would be held next week to fix the leave hearing for the concerned creditors to raise the reasons for their objections to the proposed debt restructuring scheme. This is likely to be held before Judicial Commissioner Ong Chee Kwan.

    “At the leave hearing, the creditors will then state if they think the proposed scheme is not good, unfair, or that they want to be excluded from the scheme,” one source said.

    Sources also say the hearing date for AAX’s application for leave to hold the creditors’ meeting to vote on its proposed scheme is also expected to be fixed at next week’s case management hearing. “Depending on the judge’s schedule and subject to the availability of all the lawyers (representing the scheme creditors), the hearing could be held at the end of November or early December. Of course, it is best for AAX to hold the creditors’ meeting as soon as possible,” another source adds.

    On a recent report that AAX plans to revise its scheme to address concerns raised by MAHB to be excluded from it — as the airport operator takes the view that it is a secured creditor — sources say this was not raised during the case management hearing on Oct 30. “There is nothing formal to suggest their removal (from the scheme) at the moment,” says one source.

    At the case management hearing, AAX was represented by Foong & Partners with Gopal Sreenevasan as its lead counsel. MAHB and Sky High were represented by Claudia Cheah of Skrine while BOC Aviation and Macquarie were represented by Kwan Will Sen and Joyce Lim of Lim Chee Wee Partnership. David Hoh, counsel for Abdullah Chan, represented three other creditors.

    On Oct 22, MAHB announced that it was suing AAX to recover RM78 million in outstanding aeronautical charges. The debt that it is owed is less than 0.01% of the total debt owed in the proposed scheme, it added.

    BOC Aviation had also filed an intervention application in the court for its objections to the proposed scheme to be heard. It is seeking about US$30 million in dues from AAX.

  • AirAsia offers UNLI Flight pass for a limited time only

    AirAsia offers UNLI Flight pass for a limited time only

    The tourism industry is slowly recovering, starting with the re-opening of Boracay to leisure travelers. More flights, accommodations, and tours are resuming operations to accommodate excited travelers after being stuck at home for so long! With travel restrictions gradually being lifted in the Philippines, AirAsia introduces a unique product that will allow people to travel as many times as they want around the Philippines. Yes, you read it right!

    Filipinos are known to always seek the best deals: Buy-one, take-one, 50% off, and unlimited offers on Korean BBQ, rice, and call and text promos, but have you heard of unlimited flights? AirAsia is offering the UNLI Flight pass for a limited time only!

    What is the AirAsia UNLI Flight Pass?

    UNLI Flight Pass offers a travel bundle so you can fly as many times as you want to any AirAsia domestic destination available on airasia.com or AirAsia’s mobile app for a fixed price of only PHP 4,999. The promo covers flights from AirAsia’s domestic hubs (Manila, Cebu, Clark) to your favorite island destinations such as Boracay, Cebu, Palawan, Davao, Bacolod, Zamboanga, General Santos, and so much more. The UNLI Flight Pass is perfect for both leisure and business travelers alike, especially those who are frequent flyers who aim to get a good deal.

    The UNLI Flight Pass is valid for a year, so you can plan and plot your trips ahead of time. Scratch your travel itch and grab your very own AirAsia UNLI Flight Pass available for purchase on airasia.com, through the ‘Unlimited Deals’ tile. The pass purchase period will start from November 2 until November 8, 2020, wherein flights can be redeemed from November 9, 2020 until October 16, 2021, and be used to travel between November 23, 2020 and October 30, 2021.

    How to Purchase UNLI Flight Pass?

    • Log in to your BIG Member account. If you haven’t, register already. It’s for free!

    • Click the AirAsia UNLI Flight Pass bundle

    • Purchase and pay. Only Credit and debit cards will be allowed.

    • Receive your confirmation voucher via e-mail

    How to Redeem Flights using the UNLI Flight Pass?

    • Log in to your BIG member account on Airasia ‘Unlimited Deals’

    • Select your purchased UNLI Flight Pass, confirm your full name (upon first redemption only), and click “Redeem”

    • Search dates and choose flights labeled ‘100% OFF’

    • Enter your passenger details

    • Pay any add-ons, taxes, and other fees

    • Receive your flight itinerary in your e-mail

    Disclaimer: Flights redeemed with the Unlimited Pass are subject to government taxes and fees, add ons, and other applicable charges. Seats are subject to availability. Embargo dates and other terms and conditions apply.

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  • Help small businesses instead of AirAsia

    Help small businesses instead of AirAsia

    A political economist has questioned the decision of the government-owned Sabah bank to lend AirAsia RM300 million and said the money should instead be spent to help small and medium enterprises in the state.

    Firdausi Suffian of Sabah UiTM said he was surprised to read reports that the budget airline has secured an RM300 million loan from Sabah Development Bank, a wholly-owned subsidiary of the state government.

    Firdausi said while there was nothing wrong with a bank to issue loans to a company, a state-owned bank’s priority should be to assist companies in Sabah, particularly SMEs, which have been badly affected by Covid-19.

    “Against the backdrop of Covid-19, one would think that the focus would be on SMEs rather than a company which has been making huge profits for the past few years.”

    Last week, SAPP president Yong Teck Lee had urged the state government to stop the loan, as the bank was mandated to provide financing for projects in Sabah and not on “risky ventures”.

    However, in a stock exchange filing on Friday, the airline said the loan had been secured and disbursed and would be used to enhance logistics in Sabah, helping to create over 100,000 new jobs.

    Firdausi said SMEs were the backbone of the economy, and that Sabah had 55,000 SMEs employing over 150,000 people.

    “SMEs are only getting the assistance of around RM90 million in the two Sabah government stimulus packages,” he said, pointing out that the sector contributes close to 57% of Sabah’s gross domestic product.

    Another economist, Barjoyai Bardai of Universiti Tun Abdul Razak, said he could not see the Sabah government’s rationale in wanting to loan AirAsia so much money that could be used to support struggling businesses in the state.

    “It is a different story if they are investing in the company. I think the state government will have to explain the rationale behind this decision because it will come under scrutiny.”

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  • AirAsia X ‘out of money’

    AirAsia X ‘out of money’

    The long-haul budget carrier AirAsia X Bhd has run out of money and needs to raise up to 500 million ringgit (US$120 million) to restart the airline, according to deputy chairman Lim Kian Onn. The Malaysia-based affiliate of AirAsia Group said this month it wanted to restructure 63.5 billion ringgit ($15.3 billion) worth of debt and slash its share capital by 90% to continue as a going concern.

    “We have run out of money,” Lim said in an interview. “Obviously, banks will not finance the company without shareholders, both old and new, putting in fresh equity. So, a prerequisite is a fresh equity.”

    He said the airline had actual liabilities of 2 billion ringgit, with the larger figure of 63.5 billion ringgit including all lease payments for the next eight to 10 years and its large order for Airbus planes and contracted engine maintenance with Rolls-Royce.

    “If we find 300 million ringgit in new equity, then the shareholder funds are 300 million at the restart of business and if we are able to borrow 200 million ringgit, we feel that we will have a good platform to start all over again,” Lim said.

    He said AirAsia X also needed to convince its lessors of its business plan, adding that an unnamed lessor recently took back one of the airline’s planes to convert it to a freighter.

    The airline plans to liquidate its small Indonesia-based carrier and has completely written down its stake in Thai AirAsia X, with the Thai carrier not part of the restructuring scheme, Lim said.

    Rival Malaysia Airlines is also in financial trouble, but Lim said there would be “no good outcome” from seeking to merge two airlines in dire straits.

    Initial negotiations with creditors have been tough as they are understandably upset, Lim said in the interview. They had asked for better terms, including free equity for the forgiven debt — something that would be impossible for the airline to fulfill, he added.

    Still, Lim said all of them genuinely wanted to find a common ground to take the airline forward. “No one has anything to gain from our demise,” he said.

    The airline is planning to resume flights in the first quarter of 2021, though the process remains “dynamic”, said Lim. Should the rescue plan get approval, the company will have to renegotiate every single contract and will do its best to look after all stakeholders’ interests, he said.

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  • US$1bil loan offer for AirAsia data

    US$1bil loan offer for AirAsia data

    An American lender is willing to loan AirAsia US$1bil for the data of its customers it has accumulated from its business over the years. AirAsia Group Bhd CEO Tan Sri Tony Fernandes did not reveal the name of the potential US lender but spoke on how its data-driven new “super app” would become an equal contributor to group profit with its airline business in five years.

    “The airline has created this amazing business, ” he said, adding that post-Covid, the app has seen 50 million unique visitors every month.

    “We didn’t rush into the digital age as we started this journey two years before the Covid-19 outbreak, ” he told the media.

    The contribution forecast is based on AirAsia flying 300 aircraft in five years.

    He said there was a cash-raising potential to be done at the airasia.com and airline levels.

    “The first lot of financing will be announced by the end of this month, ” he said.

    Fernandes said that all pillars of the airasia.com app have already broken even except the fintech segment of the digital business because of the interchange fees it has to pay credit card companies. However, it has secured a money lending license from the Housing and Local Government Ministry to add another element towards the app’s fintech business.

    In a statement yesterday, AirAsia said it’s airasia.com Asean super app provides over 15 types of products and services under three main pillars, which are travel, e-commerce, and fintech.

    Fernandes believes the app can be a competitor to some of the established apps in Asean like Grab and Gojek and will provide competition in a fierce segment like food delivery.

    In the lucrative food delivery business, restaurants would not have to pay a commission to airasia.com like they do for other food delivery apps, but pay instead to the food deliverer, which translates to a commission rate of between 3% and 9% per delivery.

    “Now, everyone can travel, experience, shop, eat, enjoy rewards, and more with the new airasia.com super app. From travel needs to everyday lifestyle essentials, there is something for everyone, ” said airasia.com CEO Karen Chan.

    Fernandes said AirAsia would not be taking delivery of new planes as there is a lot of excess aircraft within the industry.

    “No one is going to fly the same size of fleets they did pre-Covid-19 for a couple of years, I imagine.

    “My guess is that we would be able to fly 180 planes by end-2021 for the entire group.

    “It depends on when the borders re-open for all our markets, ” he said. AirAsia has 245 planes currently.

    In fact, Fernandes said the airline would be returning 22 planes this year to its lessors.

    “I don’t see us getting to a position where we want to buy planes for a number of years.

    “Even when you want to buy planes, there will be cheaper second-hand planes out there, ” he said.

    As for travel, Fernandes said leisure travel would likely bounce back ahead of business travel.

    “Leisure, budget, short-haul business travel will bounce back to pre-Covid-19 level and we are already seeing it.

    “In Thailand, we are 95% of the capacity of pre-Covid-19. In fact, by Q4 we will be 10% ahead of where we were.

    “When the borders re-open, (the business) will bounce back really fast, ” he said.

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  • AirAsia adding services in super app

    AirAsia adding services in super app

    AirAsia Group announced on Thursday that it is building a super app off its existing mobile application and website to provide services such as e-commerce, delivery, and payments. The app is to be available next month in Thailand and ASEAN.

    AirAsia chief executive Tony Fernandes said the idea to build a super app came before the pandemic, but new revenue streams are desperately needed after most of AirAsia’s fleet has been grounded for months because of travel restrictions. The company suffered losses of US$238 million in the second quarter of this year.

    “This journey didn’t start during the pandemic but it was accelerated because of the outbreak,” Mr Fernandes said. “This is not a Plan B, this was always our Plan A, but we still think aviation will definitely come back.”

    The new platform will be accessible through AirAsia.com and AirAsia’s mobile app on Oct 8, including digital services under subsidiary AirAsia Digital.

    These services include BigPay, a digital payment app; Teleport, a wholly-owned logistics, e-commerce, and delivery business; and Santan, a food and beverage franchise. Mr Fernandes said these services are already earning revenue for AirAsia except for BigPay, which is in negotiations with regulators to set its rates.

    Teleport came to Thailand in 2019 through a joint venture, while BigPay is available in Thailand and can transfer money to Thai bank accounts. Santan is only available in Malaysia or on AirAsia flights.

    “AirAsia’s roots are from moving people from A to B and moving cargo from A to B, and that is the basis of AirAsia Digital and the basis for our platform AirAsia.com,” Mr Fernandes said.

    The app will also allow users to book hotels and flights (from airlines other than AirAsia) and offers a travel and lifestyle rewards program. The company ended its partnership with Expedia and is offering its own travel booking service.

    AirAsia’s new venture will face stiff competition from existing super apps Grab and Gojek, which are both spending billions in venture capital to expand their presence in Southeast Asia. Grab and Gojek are in talks for a merger, which if completed would create a virtual monopoly for ride-hailing and food delivery in Asean.

    Grab is valued at about $14 billion, while Gojek was valued last year at almost $10 billion. Neither company is publicly traded.

    AirAsia, which is listed on the Malaysian stock exchange, has a market capitalization of $624 million.

    “We are nowhere near the size of Grab or Gojek, but AirAsia’s not about being dominant in one country, but providing an Asean product,” Mr Fernandes said.

    The AirAsia app hopes to differentiate itself by leveraging the data it has collected from millions of passengers, while also stressing its cross-country appeal for cross-border travelers in Asean.

    “I don’t believe we are here to compete, but here to complement,” Mr Fernandes said. “Airlines always see us as competitors, but we complemented the full service and created a new market that was not there — before, only a few people could fly, now everyone can fly, and in the same way we will complement the market.”

    He said the platform will also be open to new partners and services, not just those owned directly by AirAsia Digital.

    Michael Araneta, associate vice-president of IDC Financial Insights, said traditional businesses like AirAsia can find success with a super app by leveraging existing customer bases and technical resources.

    “AirAsia has shifted to being a lifestyle company and already has spent considerably on developing technology,” he said. “The company might not need to invest a substantial additional amount to turn their tech offerings into a super app.”

    Users of AirAsia’s super app will benefit from usage points that convert to discount flights and other related partner services supporting its core business, Mr Araneta said.

    During a pandemic, users cannot take advantage of these flight privileges as much.

    Mr Araneta said a winning super app is one that leverages considerable real-time data and various partners to provide relevant benefits to its customer base.

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  • Bamboo Airways announces first ever Hanoi-Con Dao Island direct service

    Bamboo Airways announces first ever Hanoi-Con Dao Island direct service

    Bamboo Airways will launch the first-ever direct flight from Hanoi to Con Dao Island, a tourism hotspot off the southern Ba Ria-Vung Tau Province, on September 29. There will be two round trips daily.

    The airline will also begin daily flights to Con Dao from the northern port city of Hai Phong and central Vinh Town from September 29. It will use twin-engine Embraer jets with 120 seats on all three routes.

    Nguyen Ngoc Trong, deputy director of Bamboo Airways, said the airline would carry a maximum of 100 passengers on a flight to ensure safety amid the Covid-19 pandemic.

    Vietnam Air Services Company, commonly known as VASCO, a subsidiary of Vietnam Airlines, is the only airline currently operating regular flights to the island, flying from Ho Chi Minh City and the southern city of Can Tho.

    Con Dao has a 3C classification, meaning it can only receive ATR 72 and other similar aircraft. It closes at night since it lacks a runway lighting system.

    Property developer FLC, the parent company of Bamboo Airways, has sought to invest in a lighting system so that the airport could operate at night.

    Con Dao received 400,000 visitors last year.

  • International flights resumption fails to enthuse Vietnam tourism firms

    International flights resumption fails to enthuse Vietnam tourism firms

    Vietnamese tourism companies are not enthused about the possibility of flight resumption to six Asian destinations because they don’t expect large numbers of tourists to board these flights.

    Nguyen Cong Hoan, deputy CEO of Hanoi Redtours, said that flights to these destinations will mostly serve businesspeople, workers and students and not tourists.

    “Although this shows that the Vietnamese government is opening up the doors to other countries, tourism will not see immediate benefits because the mandatory 14-day quarantine policy will discourage tourists,” he said.

    Hoan was commenting on a plan by Vietnam aviation authorities to resume commercial flights to Guangzhou (mainland China), Seoul (South Korea), Tokyo (Japan), Taipei (Taiwan), and Cambodia and Laos as early as later this month.

    The Civil Aviation Authority of Vietnam (CAAV) said this plan, if approved, will bring in about 5,000 passengers a week to Ho Chi Minh City, Hanoi and Can Tho City.

    Phan Dinh Hue, CEO of Ho Chi Minh City-based tourism firm VietCircle, said people only travel when they feel safe, and amid the ongoing pandemic, not many are willing to take the risk contracting the virus on a flight.

    People also do not want to be “trapped” in a destination if it is locked down, as happened to many last month when there was an outbreak in Da Nang City, he added.

    What tourism companies want now is a chance to reboot domestic travel. Nguyen Quoc Ky, chairman of leading tourism company Vietravel, said authorities need to establish a map of safe travel destinations in the country to boost demand and help tourism companies survive.

    Hoan of Hanoi Redtours proposed that authorities in each locality assess the Covid-19 situation in their area and make appropriate decisions.

    If there were no Covid-19 cases recorded in a locality, tourism and entertainment activities should be allowed, he said.

    He added that in the long run, if the resumption of international flights does not result in a surge of community transmissions of the novel coronavirus, the government could remove the 14-day quarantine policy. Only then would tourism companies be able resume their international operations.

    The Covid-19 pandemic has seriously damaged Vietnam’s tourism sector. Tourism revenues in the first eight months fell over 54 percent year-on-year to VND13.1 trillion ($569 million), according to the General Statistics Office.

    Foreign arrivals fell 67 percent to 3.77 million in the period.

    Last year, Vietnam welcomed 18 million foreign tourists, up 16.2 percent year-on-year.

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  • Rimowa opens Hong Kong flagship

    Rimowa opens Hong Kong flagship

    Premium luggage brand Rimowa has opened its first flagship store in Hong Kong, located at Lee Gardens. Occupying 192sqm, the store offers a selection of premium luggage, including the Original, Classic, Essential, and Hybrid collections

    The store’s facade features floor-to-ceiling glass windows and strong vertical lines incorporating lighting that “pays homage to the brand’s renowned groove design while also evoking the densely packed, iconic skyline of Hong Kong,” the company said.

    The Rimowa Lee Gardens store interior follows the minimalist design, using modern elements such as a bold pink ceiling, grey walls and floor, metallic displays, and contemporary track lighting.

    The store features a ‘sticker wall’ made from mirrored vertical metal panels. The design resembles a traditional Chinese painting known for its hanging scrolls. The sticker collection celebrates cities from across the globe and designs created in collaboration with the brand’s worldwide network of artists.

    Rimowa Lee Gardens also houses a Client Care counter where customers can schedule product servicing, and receive and inspect repaired luggage.

  • Flight restart in June offers little reprieve to Cebu Pacific

    Flight restart in June offers little reprieve to Cebu Pacific

    Gokongwei-led Cebu Air Inc. took a turn for the worse on the first half of the year as losses mounted due to the coronavirus pandemic that kept most of its fleet grounded. A gradual recovery is seen from reopening routes.

    In a disclosure on Wednesday, the budget carrier reported net losses amounting to P9.14 billion from January to June this year, a massive reversal of the P7.15 billion profits the same period a year ago. Losses worsened from the first three months of the year, when during the latter part of the period, the government declared a sweeping community quarantine that closed down airports and enforced travel barriers to contain the virus spread. The shutdown’s impact was so severe, Cebu Pacific slashed its workforce by a quarter.

    “While some sporadic arrangements for sweeper flights to assist with stranded tourists did occur, for the most part, the Group’s operations were virtually nil until April when some cargo flights within the Philippines and eventually to countries like Japan, Thailand, China, Hong Kong recommenced,” the company said.

    As the Philippines began to ease quarantine controls last June, Cebu Pacific returned flights to 25 of its 78 domestic routes in seven hubs located in areas under general community quarantine, providing relief to the bleeding. “The Group will continue to expand its operations as more local governments welcome flights into their cities,” the airline said.

    Broken down, revenues for the first six months plummeted 61.2% annually to P17.33 billion. Of that amount, P11.51 billion was generated from passenger flights, down a bigger 65.5% on-year as passenger traffic more than halved to 4.5 million from last year.

    Earnings from revenue operations, meanwhile, slipped 21.7% year-on-year to P2.22 billion in the same six-month period, incurred as a result of a 52.4% drop in cargo volumes. Ancillary revenues decreased by 57.7% annually to P4.9 billion.

    On the flip side, earnings also sank 32.2% from year-ago levels to P35.89 billion “mostly driven by the suspension of the Group’s operations due to the COVID-19 global pandemic,” Cebu Pacific said. The peso appreciation, as well as a decline in global oil prices, also helped temper disbursements by lowering imported fuel costs.

    Broken down, January-June expenditures from flying dropped 53.6% on-year to P8.15 billion, that from aircraft servicing shrank 48.8% annually to P2.17 billion, maintenance costs by 13.9% to P561.08 million, and costs from foreign exchange swings by 11.5% year-on-year to P8.17 billion.

    “The Group’s cash requirements have been mainly sourced through cash flow from operations which was significantly reduced due to the current COVID-19 situation,” Cebu Pacific said, even as the airline assured investors of its “strong” financial position.

    The budget carrier, as well as other local airlines, have pleaded to the government for a direct financial rescue to prevent collapse and layoffs. The Duterte administration, however, has rejected cash intervention to salvage firms, opting to let banks lend them money instead.

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  • Cebu Pacific sends 14 planes for storage

    Cebu Pacific sends 14 planes for storage

    Budget carrier Cebu Pacific has now sent a total of 14 aircraft for storage at Alice Springs in Australia, with more possibly eyed as travel demand is not expected to return to its robust state anytime soon.

    On top of the 14 aircraft that have been sent so far, Cebu Pacific spokesperson Charo Logarta Lagamon said the next batch is still under study.

    “We have a fleet of 75 aircraft. Because costs continue to be challenged, we have sent aircraft to Alice Springs along with many other airlines, and we are looking to send additional aircraft there for additional storage because obviously we do not see demand coming back in the immediate future,” Lagamon, who is set to leave the airline effective Aug. 15, said yesterday.

    “We will have to store these aircraft in a more proper setting and in a cost-efficient manner,” she said.

    As part of its cost mitigation measures, Cebu Pacific last month said it sent nine aircraft to the Asia Pacific Aircraft Storage at Alice Springs for storage.

    “The best place to store aircraft is somewhere that is dry. This is a facility that stores aircraft because we need to make sure that it stores in a facility that will minimize damage or be equipped for storing aircraft so that once the demand comes back we can easily bring the aircraft back into the line,” Cebu Pacific vice president for marketing and customer experience Candice Iyog earlier said.

    Meanwhile, Lagamon said Cebu Pacific management and their counterparts in Airbus are currently in discussions on the adjustment in delivery or possible cancellation of some of the company’s aircraft orders given the impact of the COVID-19 pandemic to the aviation industry.

    “This is subject to discussions with Airbus. But again, it’s not only Cebu Pacific that is the only carrier in the world that is in talks with the manufacturers for the delay or adjustment of delivery schedules of these orders,” she said.

    Quoting Cebu Pacific president and CEO Lance Gokongwei, Lagamon said the airline is expecting challenging numbers in its second-quarter financial results.

    “This is on account of the course of continuing quarantine. We are still unable to fly the majority of our flights. We’re only at 10 percent of what our capacity used to be,” she said.

    Lagamon said Cebu Pacific has canceled some 150 flights a week, or a total of about 300 flights, from Aug. 4 to Aug. 18 following the return of Metro Manila to modified enhanced community quarantine.

    Cebu Pacific incurred a P1.18 billion net loss in the first quarter, a turnaround from the P3.36 billion net income it recorded in the same period last year, as travel restrictions brought about by the COVID-19 pandemic started taking its toll on its operations.

  • Financial aid for AirAsia crucial due to high multiplier effect

    Financial aid for AirAsia crucial due to high multiplier effect

    Financial assistance such as loans with easier terms to AirAsia Group is crucial in helping the struggling low-cost carrier to turn around as its recovery will bring about a huge spillover effect to the broader economy.

    AirAsia X  chairman Tan Sri Rafidah Aziz reportedly said easier loan terms will not only provide the carrier with operating funds but also create a high multiplier effect in boosting and reviving the country’s economy.

    She was quoted by Utusan Online as saying AirAsia is negotiating for bank loans with low-interest rates and longer tenures.

    “We have a multiplier effect from flights which is 12 times, with every RM1 we bring in, another RM12 given to (economic) sectors such as hotels, resorts and restaurants, ” Rafidah was quoted as saying in the report.

    She said countries understand, when the aviation industry opens, business people and tourists will come, so hotels and restaurants will resume operations and receive visitors

    According to Rafidah, support and financial assistance is needed by the airlines affected by the enforcement of the Movement Control Order (MCO) to curb the Covid-19 pandemic.

    She noted that no income is earned during the MCO period because flights in and out of the country are stopped while expenses continue to be incurred.

    Rafidah said the Covid-19 pandemic situation has not stopped AirAsia from continuing to find new flight destinations.

    However, she said, various aspects need to be looked at first including the number of visitors and fuel prices.

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  • Vietnam Airlines wants $500 mln government bailout

    Vietnam Airlines wants $500 mln government bailout

    Vietnam Airlines is seeking an urgent VND12 trillion ($518 million) bailout from the government as the coronavirus continues to hit its revenues. It is likely to report a loss of VND13 trillion ($561 million) this year, with revenues falling by half from last year to around VND50 trillion ($2.2 billion), CEO Duong Tri Thanh said at a meeting on Monday.

    It has stopped all regular international flights since April when it operated only four domestic flights a day on average.

    In June the number of passengers rose to 84 percent of the number a year earlier. “Since 1975 there have never been fewer flights in Vietnam’s skies,” he said, referring to the year the Vietnam War ended.

    He expected the domestic market to recover to pre-pandemic levels only by the end of 2021, and the international market a year later.

    Government advisors said at the meeting that other options to rescue the airline include issuing more shares to existing shareholders or allowing investment by sovereign fund State Capital Investment Corporation.

    One of them, Nguyen Dinh Cung, said many other governments have bailed out airlines and Vietnam should do the same.

    Thanh said Vietnam Airlines has taken up the issue of funding with All Nippon Airways, which owns an 8.6 percent stake in it, but since the Japanese carrier is also in trouble it cannot provide loans now.

    In Vietnam, the aviation industry has been among the hardest hit by the coronavirus pandemic. Airlines served 14.6 million passengers in the first six months, down 46 percent year-on-year, according to the General Statistics Office.

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  • Thai Vietjet offers super-saver fares from THB50 for all 13 routes in Thailand

    Thai Vietjet offers super-saver fares from THB50 for all 13 routes in Thailand

    In celebration of its new routes in Thailand, Vietjet has kicked off a special promotion offering 500,00 air tickets priced from THB 50 (*) (USD 1.5) starting from now to 17 July 2020 during the golden hours of 1.00pm to 3.00pm (Malaysian time).

    Here’s your chance to plan ahead for a perfect Thailand trip! The promotional tickets are applicable on all of its 13 domestic routes in Thailand and valid for travel between 1 September 2020 to 30 June 2021 (**). Tickets can be booked via Vietjet’s website and mobile application Vietjet Air.

    “We are happy to bring in more flying opportunities for the people to discover the “Smiling Land” with amazing experiences. This is a perfect chance for Thai people to go on a tour within Thailand with their families and friends. We are committed to expanding flight network in domestic Thailand and continuously provide exciting experiences to our passengers with daily promotion program”, said Vietjet Vice President, Nguyen Thi Thuy Binh.

    The recently announced six new Thailand routes expand Thai Vietjet’s domestic routes to 13, allowing tourists to travel conveniently around the country. This super promotion is applicable to all Thai Vietjet’s domestic routes in Thailand from Bangkok (Suvarnabhumi) to Chiang Mai, Chiang Rai, Phuket, Krabi, Udon Thani, Phuket – Chiang Rai, and Udon Thani – Chiang Rai, including new routes from Bangkok (Suvarnabhumi) to Hat Yai, Khon Kaen, Nakhon Si Thammarat, Ubon Ratchathani (starting from 6 October 2020),  Surat Thani (starting from 4 November 2020), Chiang Rai – Hat Yai  (starting from 1 November 2020).

    Currently, Vietjet is operating a stable domestic network in Vietnam and Thailand. All Vietjet’s flights are in alignment with all global standards and guidelines from the local authorities, including aircraft disinfection.

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  • Bamboo Airways banks on Con Dao Island flights

    Bamboo Airways banks on Con Dao Island flights

    Bamboo Airways plans to launch regular flights to Con Dao Island, a tourism hotspot in southern Ba Ria-Vung Tau Province, starting August 1.

    The airline is waiting for Civil Aviation Authority of Vietnam (CAAV) approval to fly to the 16-island archipelago, according to a company spokesperson.

    It plans to operate flights from the northern and central region using four twin-engine Embraer jets holding up to 120 seats.

    Currently, Vietnam Air Services Company (VASCO), a subsidiary of Vietnam Airlines, is the only airline operating regular flights to the islands from Ho Chi Minh City and the southern city of Can Tho using the ATR 72 short-haul aircraft that could carry up to 78 passengers.

    Con Dao Airport has a 3C classification, meaning it can only receive ATR 72 aircraft or equivalent. It functions for 12 hours a day and closes at night since it has no runway lighting system.

    Property developer FLC, the parent company of Bamboo Airways, earlier proposed to invest in a lighting system so the airport could operate at night.

    A 4C upgrade is planned for the airport by 2030 so that it could receive Airbus A319 jets carrying up to 156 passengers.

    Budget airline Vietjet had made a similar request in 2018 to operate flights to Con Dao with the same aircraft model but is still awaiting approval.

    Ba Ria-Vung Tau Province received 15.5 million tourists in 2019, up 15.2 percent year-on-year. A total of 500,000 were foreigners.