15 Years in a Row: What Sets the World’s Best LCC Apart? An Interview with CEO Tony Fernandes

– What are your thoughts on business in Japan?
“Japan is fantastic. Not just for AirAsia but for many airlines. Obviously, the yen is weak.

True story, I give out a lot of free flight tickets to my staff. They first say they want to go to Japan, and everyone still wants to go to Japan. Korea is catching up, but Japan is still number one. Many Japanese love coming to Southeast Asia.

So for me, while everyone goes to Tokyo or Osaka, I want to go to smaller cities. I want to fly to Hiroshima with the new Airbus long-haul aircraft. It’s hard to fill large aircraft to secondary destinations like Nagoya and Hiroshima, but it’s possible with narrow-body long-haul aircraft. Our plan is to go to all cities in Japan and connect them to Bangkok, Bali, Phuket, Indonesia. There’s so much we can do.

One of our gifts is, if world airlines are focusing on big cities like Tokyo and Osaka, we want to provide opportunities for those who cannot use direct flights. Most people in Japan have to transit through Tokyo or Osaka, and I’ve done it too, many times. Right? So I want to go to Kobe. Hiroshima, Nagoya, Sendai are markets we can serve. And there’s a reason because my friend Mikitani-san has a baseball team here, the Rakuten Eagles. Japan is a huge market for us, and also a very big business in cargo.”

– What about routes to the American West Coast?
“Hawaii is not in our plans, but we intend to fly to Los Angeles and San Francisco from Japan. Our team in Japan is working on it. And we’re waiting for Rolls-Royce engines to be fully repaired.

We connect not just Japan but also Southeast Asia and America, and vice versa. And soon we’ll fly to Africa. Japanese can come to Kuala Lumpur and fly with us to Nairobi, or even to Kazakhstan. We’re trying to create a very interesting hub. Of course, America will be a great place too. If you go to America, only Europe remains. Then if you go to South America, you’ve covered all continents.”

– Any plans to revive the London route?
“That’s a question everybody loves. I’d like to, as it’s sort of a second home. But for now, saying yes would be a lie. We plan to start with Eastern Europe. If we get the right aircraft, then we may consider it (restarting London flights). It was a big deal for us. One of the issues we’re asking the government for is to get more rights. We could be bigger. But there are constraints in metro cities. We’ve just launched a new flight to Lucknow.”

– What about diversification of business?
“We have five big divisions. There’s the aviation business. There’s a big chance for our cargo’s Teleport. Move Digital is the OTA and rewards program, and fintech. So, very similar to Rakuten.

A very exciting group is our engineering company, catering business, ground handling company, and shared services. The last is a branding company, which is very interesting. People in Asia didn’t understand branding. I’m the first guy to sponsor Manchester United and F1. Just by taking my shirt off, I become global news.

If it weren’t for AirAsia, it wouldn’t be covered. So we’ve built a great brand. If you want to start a hotel, just call it ‘AirAsia Hotel.’ I don’t want to, but if you license my name, everyone will immediately know it. ‘AirAsia Hotel’ would be low-cost and nice. Many corporations want to use our brand to deploy value-oriented businesses. Efficient and good quality. So, we’ve been approached by transportation companies, mobile phone companies, and hospitals wanting to launch low-cost services. So that’s my story up to now. We’ll focus on these five. (Until we reach 20 consecutive Best LCC wins) We have five more years. Then I’ll retire, go to a hot spring in Japan. And the next CEO will be the young ones.”

– What about expanding into other forms of transportation, like trains?
“Oh, that would be fun. Someday all of a sudden, trains were put under government management. To ride a train, you have to be either on a lot of drugs or crazy. Be careful.”

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