14 March 2015

AirAsia could postpone A350 deliveries

Malaysia's AirAsia X will cut flights on unprofitable routes, reorganize staff and defer some aircraft deliveries to turn around the loss-making long-haul budget carrier, said the airline's acting chief executive.

"Capacity reduction and cost-cutting within the organization would be 2 strategies this year," Benyamin Ismail, the acting CEO of AirAsia X said. Squeezed by intense competition in Southeast Asia's crowded aviation business, the airline has lost money for the last 5 quarters.

Benyamin was named acting CEO for an indefinite period after former chief Azran Osman Rani resigned following a management reshuffle last month.

Hit with 3 disasters last year - the disappearance of Malaysian Airlines flight MH370, the same carrier's MH17 shot down over Ukraine, and the crash of the QZ8501 jet operated by an AirAsia X affiliate in Indonesia - demand for air travel in the region has dampened, Ismail said.

Ismail said the airline may look at deferring some plane deliveries and selling slots to potential buyers. "If there are reasonable and keen buyers for those aircraft, we may sell the slots," he said.

AirAsia X will also assess capacity requirements based on plane orders and deliveries coming up in the next few years, he said. This would include looking again at orders for Airbus A350 and A330neo jets, Benyamin said.

The carrier has 10 A350s on order and also ordered 50 A330neo aircraft last year. Ismail declined to give specific details but said the airline would focus on using A330neo for its operations.

Based on the article “Malaysia's AirAsia X to cut costs, may defer plane deliveries: Acting CEO” published in Reuters.

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