AirAsia is indisputably one of the world’s most successful airlines ever—don’t let its notoriously complex accounting obscure that reality. But the company is now trying to be something much more than an airline.
Less than three months after the 9/11 terror attacks upended the global airline business, a music executive named Tony Fernandes bought a moribund airline in Malaysia and turned it into a low-cost carrier flying B737-300s. It was an overnight success, so much so that just a few years later, AirAsia started another airline in neighboring Thailand—Thai AirAsia, too, would prove successful. Late that same year—2004—AirAsia used newly raised funds from a public share offering to place a large narrowbody aircraft order, a hotly contested order that Airbus would win against a greatly disappointed Boeing. In the ensuing years, AirAsia would become one of the largest and most important Airbus customers, ordering a grand total of 688 aircraft. That earned it some of the most favorable aircraft prices of any airline, a major competitive advantage.
Today, the AirAsia group consists of nine different airline ventures, six of them flying shorthaul and the other three longhaul. Some are separately traded entities, like AirAsia X in Malaysia, of which AirAsia owns 14%. The majority are joint ventures with local investors in the countries where they’re based, to comply with foreign-ownership regulations. But all carry the highly recognizable AirAsia brand and work closely together, both commercially and operationally. As of the start of this year, the nine airlines together operated a fleet of 260 planes from 23 bases throughout the ASEAN region, India, and Japan. But most importantly for Fernandes and his vision for the future: All the data AirAsia has from having flown some 500m passengers since its inception…
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