Tony Fernandes, the head of Capital A Bhd, AirAsia's parent company, announced intentions to lower airfares despite acknowledging the hurdles posed by escalating oil prices and the robust US dollar.

Speaking to reporters at an event held at the Kota Kinabalu International Airport (KKIA) on Monday (Dec 4), Fernandes emphasized the budget airline's attempts to reduce airfares. He acknowledged the airline's challenges while urging compassion as they navigated through the pandemic's aftermath.

"Despite the revenue losses, our airfares remain notably more affordable compared to competitors," Fernandes remarked.

Highlighting that 92% of their domestic flights offered low-season airfares and mentioning ongoing promotional deals throughout the year, he pleaded for understanding given the airline's significant losses, citing a RM4 billion loss last year and RM400 million in the last quarter. "But also have a heart on us, we lost RM4bil last year (and) last quarter we lost RM400mil."

"I can't control the price of oil. The US Dollar is very strong - 75% of our costs are in Dollars. So when it is strong, my costs go up."

Factors like the strong US Dollar affecting 75% of their expenses, alongside uncontrolled oil prices, have escalated costs for the airline.

With calls, especially from Sabah and Sarawak, for cheaper flights during festive seasons and school breaks, Fernandes advocated for an increase in flight frequencies to accommodate the travel demand, following Transport Minister Anthony Loke's previous announcement of fixed fares during festive periods.

However, he acknowledged the challenges of reinstating all 200 AirAsia planes from storage, stressing the need for financial support to boost capacity. He emphasized cost reduction strategies such as utilizing simpler facilities and operational measures to mitigate expenses.

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Source: The Star