The driving force behind Asia’s development of low-cost air transport is changing.
After more than 20 years in the role, the chief executive of Asia’s top low-cost carrier is finally stepping down. The airline was established in 2001 by Tony Fernandes, who paid the Malaysian government merely 30 cents for the rights to the name.
It’s time for a change.
Almost two decades after founding AirAsia as one of the region’s first low-cost carriers, Tony Fernandes, CEO of the AirAsia group of enterprises, has declared his desire to step down from the position.
Fernandes, whose name is synonymous with AirAsia and low-cost air travel in many Asian nations, is finally ready to leave on, leaving the business he built completely incomparable to how it was when it first began operations in November 1996.
A Malaysian government-owned conglomerate sold the AirAsia name to Fernandes in September 2001 for the equivalent of just 30 cents. The company he later created is undoubtedly the most well-known and well-liked low-cost airline brand in all of Asia.
planning for succession
According to Yahoo News, Fernandes has already made the decision to depart the business he started, though he hasn’t said with certainty when. How long it takes to locate a suitable replacement for him will be a major factor in his choice. This week, Fernandes revealed his choice to Bloomberg, saying,
“Knowing when to leave is a quality of good leadership. I don’t really care where [my replacement] is from. We don’t really discuss topics like race, religion, sex, or sexual orientation. As long as they are able to complete the task, I don’t care.
A difficult few years for AirAsia
From a small company operating a few outdated Boeing 737s out of its hub in Kuala Lumpur, AirAsia and its subsidiaries have expanded into one of the biggest low-cost carriers in the area.
According to ch-aviation.com, AirAsia now has a fleet of 99 Airbus narrowbodies, with 354 more A321NXs on the way. The airline offers flights to 66 locations in 18 different countries. Along with the low-cost, long-haul subsidiary AirAsiaX, the group also consists of the partner airlines AirAsia India, Indonesia, Philippines, and Thai AirAsia.
The other subsidiaries have struggled over the previous few years, with the Thai company and the Japanese airline within the brand family both declaring bankruptcy. The latter, however, has experienced something of a miraculous revival after the conclusion of the COVID-19 pandemic. The Japan-based iteration failed but the Thai-based operation persisted despite this setback.
The group also survived the tragic collision involving Indonesian AirAsia Flight 8501 in 2014. The trip was a regularly scheduled international passenger flight from Java, Indonesia’s Surabaya, to Singapore, operated by the Indonesian affiliate.
All 162 occupants of the Airbus A320-200 that was traveling the route were killed when it crashed into the Java Sea on December 28, 2014. One of the plane’s rudder travel limiter devices experienced an electrical failure, which set off a chain of mishaps and mistakes that resulted in an unrecoverable stall.
With over 200 aircraft and 21,000 employees spread across Malaysia, Thailand, Indonesia, and the Philippines at its height, AirAsia was the fourth-largest airline in Asia.
What comes next for Fernandes?
The 58-year-old Fernandes left her position as group CEO of AirAsiaX in November 2022 to concentrate on Capital A, a significant rebranding initiative of the AirAsia Group that had been initially announced back in January of that year.
According to reports, Fernandes is regarded as a tough airline CEO as well as an accomplished business leader. However, at this time, he is unsure about his potential next location. Fernandes disclosed the following in an interview with Bloomberg on his future plans:
“I enjoy private equity with active management and supporting young individuals making changes. I think there is a low-cost model for both health and education. The two biggest grounds for discrimination are these two.
In the airline industry, “musical chairs”
Following a series of executive transitions happening right now in the global airline business, Tony Fernandes left AirAsia. Simple Flying has recently covered the sacking of the CEOs of TAP Air Portugal and Viva Air Colombia as well as the appointments of new CEOs at Brussels Airlines and IndiGo. Doug Parker, the former CEO and chairman of American Airlines, retired in February of this year.
It would be interesting to see where Tony Fernandes appears next after guiding AirAsia through the last 20 years of ups and downs and bringing it from modest beginnings to where it stands now. And although if he doesn’t seem interested in taking on another management position with an airline, he hasn’t completely ruled it out just yet.
