Will Air Asia get their ‘Ong’ after this round?

Air Asia has been trying to get into the good books of the powers-that-may-be post PM ‘Flip-Flop’ Abdullah Ahmad Badawi era. Since their initial exponential growth is partly attributable to PM ‘Flip-Flop’  Abdullah’s patronage.

The effort now include appointment of legendary former MITI Minister Tan Sri Rafidah Aziz as Chairman not too long ago. Being a tough economic minister and negotiator, it is expected that Rafidah’s role include to secure more landing rights and probably code share or other partnership programs with other carriers.

In short, Air Asia is bent on soaring of new heights.

Recently, Executive Director Dato’ Kamaruddin Meranun managed to impress Fourth Prime Minister Tun Dr Mahathir Mohamad to visit their training centre in KLIA. For the first time since nine years ago, the much valued Tun Dr. Mahathir’s patronage is able to be achieved.

Air Asia’s sights are locked on getting the lucrative Kuala Lumpur-Jedda and Kuala Lumpur-Sydney route from the Malaysian Government. The success of Air Asia X as an intercontinental low cost carrier rests on routes such as this. The Sydney route would complement the existing Melbourne and Perth routes and the additional destination would make Air Asia very attractive to the British market.

 

Not exactly a 'low cost carrier' product now, is it?

This growth would definitely impair Malaysia Airline’s important Australia-Malaysia-Britain route. Especially Air Asia X is offering their Premium Class, which technically should disqualify them as a ‘low cost carrier’. Then again, Air Asia so call ‘low cost fares’ are of fancy marketing gimmick rather than serving its consumers’ expectations. It was raised two days ago in Dewan Rakyat that Air Asia charges an equivalent of a  five star tier fare.

In ensuring that, Ethos Consulting Supremo Omar Ong has recently be appointed as a BOD member. Tony is hoping that Ong who is very close to PM Dato’ Seri Mohd. Najib Tun Razak would do wonders, as former MOT Chief Secretary Dato’ Pahamin Rejab had amazingly achieved when they first started and Kalimullah “Riong Kali” Hassan during PM ‘Flip-Flop’ Abdullah’s time. One of Air Asia’s key success was the ‘Airline Rationalisation Plan’ which the notorious ‘Level Four Boys’ managed to shoot down then Idris Jala’s route restructuring plan in mid 2006 and instead, monopolise majority of the domestic routes. This include the heavily subsidised rural air service (RAS).

The inclusion of RAS benefitted Air Asia immensely. Instantly, the network route was then more than doubled and Air Asia enjoyed the subsidy that comes with the route. The moment the growth is achieved with the route expansion and the marketing strategy that was achieved with the exponential growth attained, Air Asia gave the RAS back and Malaysia Airlines had to carry again the very important communication to the interiors of Sabah and Sarawak.

Now, the ‘Thirteen Million Plus Ringgit’ question is, would PM Najib honour Air Asia’s request via Ong, and at the expense of the national carrier Malaysia Airlines?

Probably Omar Ong would bring the ‘ong’ that Tony expect to gain, this round.

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Published in: on March 16, 2011 at 20:15  Comments (17)  

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17 CommentsLeave a comment

  1. BD,

    In other word, you’re telling without this tongkat – SamDol, Kali and KJ , Air asia is just another budget airlines. ha ha

    And now he needs a pair of new tongkat

    Actually I agree with you and the whole market knows about it.

    It’s time to show your true capability Tony and Azran, minus those new tongkat.

    • benar n jelas….bro BD….

    • An indian needs a tongkat? Wonder never cease!!!!

  2. Well, how long has MAS been supported with “tongkats” from the government?

    From the break-up of Malaysia-Singapore Airlines (MSA, for those fond of nostalgia), what has MAS done to distinguish itself from it’s erstwhile sibling, Singapore Airlines (SIA), apart from stumbling from crisis to crisis?

    MAS was supposed to be instrumental in supporting the KL International Airport (KLIA) to be a regional air hub. It failed dismally in this to the extent that KLIA is now playing second fiddle to Hong Kong International Airport, Singapore’s Changi Airport and Bangkok’s Suvarnabhumi Airport.

    Hyperbole? Look at the number of airlines, the routes connectivity, destinations served and passenger numbers for the respective airports.

    Yet, everyone seems to want to cut MAS more slack. Why? Because it is a GLC? Because it is the national “flag carrier”? Or because it is one of the symbols of, shall we say, a certain triumphalism amongst certain organisations?

    • As far as I understand MAS decision is not always purely making money. As a goverment entity, and therefor rakyaat’s, it must also provide services especially to rural area event at a loss.

      Isn’t so Skilagannon?

      • Mohamed

        You are kidding, right, playing the tired old chestnut of servicing loss-making rural routes?

        If what you say is correct, then why bother listing MAS on the Bursa Malaysia stock exchange as shareholders have a reasonable expectation of capital appreciation (in terms of share price) and good dividend payouts?

        Has MAS delivered to it’s shareholders in either of the above?

        Last Friday, March 18, MAS shares closed at RM1.84, while AirAsia shares closed at RM2.45 on Bursa Malaysia? Different valuations for MAS and AirAsia?

        Let’s not even talk about Singapore Airlines (SIA) whose shares last Friday closed at S$13.10 on the Singapore stock exchange SGX.

        And MAS and SIA were siblings in the then Malaysia-Singapore Airlines (MSA).

        How their paths have diverged since then!

      • Also, Mohamed – please elaborate how AirAsia’s business model is different from, say, Jetstar/Jetstar Asia (majority-owned by Australian airline Qantas) or Tiger Airways (in which SIA is a substantial shareholder)?

        Jetstar/Jetstar Asia and Tiger Air are both LCCs (low-cost carriers), as is AirAsia.

        And both Jetstar and Tiger Air are profitable!

      • When confronted by logic, Mohamed has apparently retreated into a discreet silence!

  3. well, it seems both party need tongkats. Except MAS being a GLC, of course they have the tongkat mentality.

    but since when is Air Asia is also a GLC ?

    It was a ILC during dolah time ( In Laws Company ) but not anymore.

    well, Tony and co is not that good actually and they still need invisible tongkat to crawl.

  4. Well done, Bro. Great exposure.
    More of Tony’s track record and KPI below:

    Malaysian Insiders wrote “Fernandes, however, has managed to prove his early critics wrong with the success of his company Air Asia.”
    Critics: Yes, Tony was also right when he said “I know Malaysians very well,” said Fernandes, a native of Malaysia. “If you put a fare low enough, they’ll risk their lives,” he said, as the crowd laughed. Source: http://www.columbusdispatch.com/live/…ml?sid=101

    TF said in Malaysiakini “The biggest mistake of my life, and to be fair to this guy, is (when) Khairy Jamaluddin’s team came to propose sponsoring the MyTeam (football project). Honestly, it was the biggest mistake of my life. … But then it backfired because suddenly, it was rumoured that Khairy and the ‘Fourth Floor’ now own 40 percent of AirAsia. Come on!”
    Critics: TF paraded KJ to lobby the Govt. for the domestic routes and FAX later screwed up after one year !! You claim to be a genuine businessman who works hard and yet you saw it fit to fawn over politicians like Shahrizat Jalil. Yes, Tony. We all saw you in her ceramah and operations centre in Bangsar. Singing the praises of Barisan Nasional loud and clear. So, it would be safe to say that your biggest mistake to date was supporting Barisan Nasional. You have also been spotted by many trailing in the wake of DPM and Nazir Razak.

    TF said in Malaysiakini “Tiger Air has eight planes, we have 75. Tiger Air has Temasek, Singapore Airlines, TPG – the biggest private equity house – and the Ryan family. You cannot get better shareholders than that. Yet with all the obstacles put in front of us here they have only got eight planes and we have 75.”
    Critics: Please show your ROI and don’t give bullshits instead especially when one A320 costs around RM 120 – 150 million, you are not getting minimum 70% load factor with “normal fares” but with RM 1 fares. Wow Tony, even Tan Sri Aziz, the former MAS MD had said to you that he saluted you because even with these RM 1 fares, you still make RM 1 billions profit. Really Tony, are you the King Midas or Black Midas?

    MI wrote: “One marketing professional, who declined to be identified, said the issue was quite subjective as it had the potential to boost national pride but cautioned that it could also have the opposite effect. “Can you imagine if 1 Malaysia F1 keeps losing? The TV commentators will make a joke.”
    Critics: Why not, TF can easily sell Ice to the Eskimos, Disneyland to Walt Disney and Virgins to Richard Branson. Make another big blunder and TF will soon be promoted as a Minister.

    We are watching you and the best is yet to come, Tony dey !!!

    • CON AIR

      You omitted any mention of Tajudin Ramli’s tenure at Malaysia Airlines (MAS).

      A selective lapse of memory???

      • Skil,
        We whacked all culprits below.
        Majority still sleeping.

        http://rockybru.blogspot.com/2010/08/why-sia-is-worth-s187-b-and-mas-is.html

      • CON AIR

        Really? Then please explain exactly what action has been taken against Tajudin Ramli?

        Or against those in power when he was asked to do “national service” in MAS?

        Of course, we all know how that turned out, don’t we? The Turnaround Plan, the divestment of MAS’s HQ building……

    • CON AIR

      The number of Airbus aircraft ordered by Jetstar/Jetstar Asia, Tiger Air and AirAsia/AirAsia X is not a state secret. The info is available on the Airbus website.

      I don’t think that Airbus Industrie would that stupid as to allow AA/AA X to buy their aircraft without assurances of payment.

      Unless you are suggesting that Tony F negotiated some pretty special terms with the folks at Airbus? If he managed to do that, then maybe he should be put in charge of negotiating defence procurements for the government! Nothing like screwing the Yanks for special prices on F-18 Super Hornets or the Russkies for super deals on the latest Sukhois and MiGs!

  5. […] is supposed to lobby for that. On top of that, highly controversial Ethos Consulting supremo Omar Ong, who is said to be very close to Prime Minister Dato’ Seri Mohd. Najib Tun Abdul Razak, has […]

  6. […] and someone who is very close to Prime Minister Dato’ Sri Mohd. Najib Tun Abdul Razak, Omar Ong, in the BOD is very good strategy for their business. This include to maintain the tax break and probably other […]

  7. […] it was the appointment of former MITI Minister Tan Sri Rafidah Aziz and PM’s blue-eyed-boy Omar Ong into the BOD. Then it was about trying very hard to get the ‘replacement Labu’. Rumour has it that […]


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