AirAsia passengers may have to fork out more for their flights in the future as the low-cost airline has said that it is studying the possibility of increasing its fares. This follows the government’s implementation of the conditional movement control order (CMCO), which sees some relaxation of restrictions for airlines.
According to the executive chairman of AirAsia, Datuk Kamarudin Meranun, discussions are still ongoing as to whether AirAsia urgently needs to increase its future fares. He also clarified that even if there is an increase, it will not be a significant one.
“At the moment, we do not know exactly how much the increase would be (if any) as we do not know the total number of AirAsia aircraft that would be allowed to operate during the CMCO,” said Datuk Kamarudin. He also added that the increase will be determined by costs, although AirAsia will do its best to keep its current fare so as to avoid burdening their passengers.
Datuk Kamarudin also emphasised that AirAsia is not aiming for profit by resuming flight operations as the current situation makes it challenging for airline companies to do so. Instead, it is to ensure that operations can continue. “As long as we can pay for management costs such as maintenance and so on, it is sufficient,” he said.
Additionally, Datuk Kamarudin reminded that the operation of airlines is subject to government directives, particularly 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 added.
Earlier last week, the International Air Transport Association (IATA) noted in a statement that air fares may need to increase by up to 54% just to break even if social distancing is implemented among passengers. Malaysia Airlines (MAS) and Malindo Air concurred with IATA’s observation, with MAS pointing out that this was the case in Thailand. Domestic fares in Thailand had increased by 50% after the Thai government regulated empty seating between passengers.
Following the start of the extended CMCO on 13 May 2020, the government had also begun to relax restrictions for air public transport providers, particularly for flights between Peninsular Malaysia and East Malaysia. Airlines are now allowed to carry the total maximum capacity of passengers for scheduled flights from Peninsular Malaysia to East Malaysia. However, scheduled flights from East Malaysia to Peninsular Malaysia are only allowed a maximum 66.6% of the total maximum of load factor.
(Source: The Edge Markets)