Tombstone Air looks like are drawing up fresh strategies, to get themselves out of trouble. They are in an enigma of variable elements crushing and probably controlling personality Tony Fernandes crafting something as the apparent downturn and bubble burst on the low class carrier group.
Published: Wednesday November 6, 2013 MYT 6:56:00 PM
Updated: Wednesday November 6, 2013 MYT 7:02:46 PM
AirAsia’s Kamarudin made executive chairman under re-designation of key executives
KUALA LUMPUR: Datuk Kamarudin Meranun has been appointed non-independent executive chairman of AirAsia under the group’s move to re-designate its key executives, which came into effect on Wednesday.
Kamarudin was the non-independent, non-executive director prior to the re-designation. He would take the lead in engaging with the government, aviation regulators and airport authorities in Malaysia.
He replaces Aziz Bakar who remains on the board as a non-independent non-executive director. This appointment follows the practice of appointing a Tune Air representative as chairman and is effective from Wednesday.
“Kamarudin has spent more than a decade building AirAsia into the world’s largest low-cost carrier and I look forward to the industry experience he will bring as chair of the Board,” said AirAsia Bhd CEO Aireen Omar.
Aziz Bakar was re-designated non-independent, non-executive director. He was formerly the non-independent non-executive chairman.
As for Fernandes, he was re-designated group chief executive officer and non-independent executive director. Prior to the re-designation, he was the non-independent non-executive director.
The re-designation was after the recent merging of the regional office’s group functions back into AirAsia Bhd.
“As group CEO, Fernandes will provide overall leadership to the group in driving brand value, reducing cost and driving efficiencies to improve performance of the airline and other affiliates within the AirAsia network including Thailand, Indonesia, the Philippines and soon to be India,” said AirAsia.
Fernandes said the regional office set up in Jakarta as AirAsia Asean two years ago has achieved its objective in providing focused leadership to the group and guiding expansion within the region.
“As such, we are merging most group functions back into AirAsia Bhd to ensure alignment within the core management team and to simplify the operation,” Fernandes said.
With this change, Rozman Omar will also return to AirAsia Bhd as group chief financial officer where he will use his extensive experience in finance to develop a group-wide growth strategy that will create long-term value for shareholders. Andrew Littledale will continue as CFO of AirAsia Bhd.
Kamarudin said the changes followed months of discussions between himself and Fernandes, and are aimed at sustaining AirAsia’s growth trajectory.
Aireen remains CEO of AirAsia Bhd and will report to the chairman on regulatory and stakeholder management and to the group CEO on operational performance matters.
Riong Kali dot com report on Tony Fernandes’s strategic sucessor, to immediately swallow their pride and quickly apologise to Utusan Malaysia for AirAsia X CEO Azran Osman Rani’s faux pas and the drama that preceded that.
Now, AirAsia chief says sorry to Utusan over “racist” remark
NOVEMBER 08, 2013
Kamarudin Meranun is now the first executive chairman of AirAsia. – The Malaysian Insider pic by Afif Abd Halim,
November 8, 2013.In a volte face, AirAsia’s new executive chairman Datuk Kamarudin Meranun has apologised to Utusan Malaysia over his colleague’s remarks that the Umno-owned daily was racist in its election coverage last May.
The Malay-language newspaper quoted Kamarudin as saying that he had written to apologise for AirAsia X chief executive Azran Osman Rani’s remarks. AirAsia X chairman Tan Sri Rafidah Aziz had previously said Azran’s views are his own and Malaysians should be allowed to express their views.
“In all honesty, as a representative of AirAsia, I had written to the Utusan group editor to express our disappointment over Azran’s actions which were unexpected,” Kamarudin was quoted as saying in the Utusan report.
Calls made to AirAsia to verify Kamarudin’s comments to Utusan have not been answered.
Azran had criticised Utusan in his Twitter microblogging account for what he reportedly saw as a racial instigation in the aftermath of the May 5 general elections.
He was also reported to have criticised Malay group Perkasa for its hardline stance as an irrelevent organisation that had caused Malays to be myopic.
But Kamarudin told the newspaper that no action was taken against Azran as he should be allowed to learn from the experience.
“Azran is still Air Asia X chief executive officer and has been advised to separate his political stand from work,” said Kamarudin, who became the budget carrier’s first executive chairman two days ago.
Kamarudin and his partner Tan Sri Tony Fernandes own Tune Air Sdn Bhd, which is a major shareholder in Asia’s biggest budget carrier, AirAsia.
The AirAsia group includes operations in Thailand, Indonesia, Philippines and soon in India, apart from the long-haul airline AirAsia X. It recently stopped a partnership in Japan.
The Utusan report today also quoted Kamarudin as criticising government-linked-companies which had to be told to advertise in Malay dailies, adding he was embarrassed that it had come to the point where even the leadership had to appeal for advertisements to be placed in these dailies.
“It is even more embarrassing when Prime Minister Datuk Seri Najib Razak himself has to appeal to these companies.
“We at AirAsia will continue to place advertisements in Malay dailies, especially Utusan Malaysia. Undoubtedly, we also need your support as Utusan’s role is very important,” he said.
When officially opening Utusan’s new headquarters on September 13, Najib had said newspaper companies cannot rely solely on circulation to stay in business and that advertising was needed to keep the 75-year-old newspaper afloat.
Utusan had said it would not accept advertisements from AirAsia unless Azran apologised for his remarks. But the AirAsia X chief executive has not done so. – November 8, 2013.
The fact is that, AirAsia has been taking a continuous beating. It is for the sins that they have imposed themselves especially to Malaysians these past slightly over ten years with all sorts of schemes.
First, Fernandes’s ‘Share-Swap’ scheme trying to cannibalise Malaysia Airlines in August 2011 lasted barely ten and half months, before Prime Minister Dato’ Sri Mohd. Najib Tun Razak reversed the decision to status quo.
Then Prime Minister Najib allowed a direct competition to the Tombstone Group, Malindo Air to be incorporated and given operating license very quickly. Malindo Air was quick to capture a market previously nearly monopolised by Fernandes’s low class carriers.
The third element which dented Fernandes’s Group financial position is the attempt to incorporate operation via Batavia Air and AirAsia Japan (in partnerhsip with ANA) failed.
Then there is the really bad perception of the series of fines imposed against AirAsia, which include Australia. The one by Malaysia Anti Monopoly Commission was a very stiff one, by any standard for a Malaysian corporation to be fined by an authority.
As a result, for two straight quarters AirAsia’s profitability slide downwards. So is the revenue and cashflow position. That contributed AirAsia’s stockprice to slide down from RM4.00 position when the ‘Share-Swap’ scheme was finalised and inked with Khazanah in July-August 2011 to the neighbourhood of RM2.50-2.60 within the last four weeks.
That is practically losing 35-40% of the value of AirAsia.
There could be two prevailing reasons for these strategic shuffling at the BOD in AirAsia and Tombstone Air Group. The apology to Utusan Malaysia and attempt to win back the hearts and support of the nationalists and powers that be especially within UMNO leaders is very strategic.
Fernandes could be either crafting another scheme to unload a substantial amount of AirAsia and AirAsia X shares to GLCs, either Khazanah and/or EPF. Now that a substantial shareholder like Kamaruddin is taking the Executive Chairman position, the new player could also be the upcoming ASB2 unit trust scheme under PNB, which Prime Miniser Najib announced in September for the maximum of RM10 billion new investments opportunities under Bumiputera Economy Empowerment Program.
Since the past two years ago, Fernandes has been using Kamaruddin to get closer to Tun Dr. Mahathir and get his buy in and endorsement for AirAsia. This is something Fernandes could not do on his own.
The other probablity is that Fernandes and Co are cashing out in a systematic program. After all, tweleve years is a full cycle for a marketeer like Fernandes to stick around for a project even when he had a lot of his own personal stake.
The other reason is that Tombstone Group really in need of additional investments and cheap source of funds. Maintaining their market share needs continuous steady growth and the region is already saturated especially when Singaporean and Indonesian players are taking prominence.
SIA recent announced expansion program for Silk Airways, Tiger Airways and the recently launched Scoot Air. Malindo Air is set to be the largest low cost carrier in the region, which is expanding also as an intercontinental carrier.
Hence, the Malaysian Government via GLCs like Khazanah, EPF, KWAP and PNB are potential long term private equity and commercial papers subcribers for whatever capital that Tombstone Air needs to raise, to realise their expansion plan.
Kamaruddin aka Din Meranun’s job is exactly that. He is the financial man when the two partnerships meteorically rose the low class carrier. Provide the Malay-ness of Tombstone Air Group and be the Malay face of AirAsia, as he is officially the executive in-charge of Government liaisons. An ex-MRSM and ex-ITM is the face to NEP-ise the AirAsia out of people with false British accent like Fernandes or a nut-forgetting-its-shell Malay like Azran and Aireen.
It is has been proven time and again that everything that Fernandes and Co wants to do, got to be taken with a pinch of salt. Changing the ring master doesn’t make the circus and the side shows more interesting or able to achieve new feats.