AirAsia researching the possibility of rising airfares in future

By TIN Media | Airlines Published 1 year ago on 14 May 2020
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AirAsia Bhd, a lower-cost airline is researching the possibility of rising airfares in the future, following the introduction of the Conditional Movement Control Order (CMCO).

Datuk Kamarudin Meranun, Chief Executive Officer, said the discussions are still taking place to determine if AirAsia should necessarily need to increase its airfares.

“Even if there is an increase, it will not be significant. We don't know how much the increase is (if any) at this moment, as we don't know the total number of aircraft that are allowed to operate during CMCO," he said.

Some local operators warned that, if the social distance is being introduced on aircraft, passengers would likely have to pay more than 50 percent or more as suggested by the International Air Transport Association ( IATA) because of COVID-19. 

Malaysia Airlines Bhd (MAB) and Malindo Air said it would result in an up to 54 percent rise in airfares if passengers had to practice social distancing.

MAB reported that the result was an increase in domestic prices over 50% in Thailand after its government-controlled empty seats between passengers.

"We will continue to drive dynamic pricing based on capacity and demand. Promotions will surely be ascertained periodically as and when it is feasible.

“We expect customers to be more concern about safety and security," it said in a news report yesterday.

Kamarudin said the price rise would be subject to costs and Air Asia will try to avoid raising its prices to discourage passengers from burdening them.

“Our intention is resuming flight (operations) is to ensure that operations can continue and not because we are aiming for profit, as, in the current challenging situation, it is difficult for airline companies to make a profit.

“As long as we can pay for management costs such as maintenance and so on, it is sufficient,” he said

He said that the activity of airline companies is subject to guidance from the government, so all plans must follow the decision of the government, especially during the CMCO.

“So, when we made a plan and when the announcement by the government is not in line with our plans, we have to change it,” he said.







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