AirAsia food delivery off to slow start in Singapore - CEO remains optimistic


AirAsia's food delivery platform was launched in Singapore in March with about 80 restaurants. - AIRASIA

SINGAPORE (The Straits Times/ANN): AirAsia's food delivery service in Singapore is off to a slow start in the four months since it launched, with just about 100 orders daily.

AirAsia chief executive Tony Fernandes provided the update during a virtual media roundtable on Thursday (July 22).

But he said the performance of the airasia food platform so far was "exactly what we predicted", with AirAsia's priority now to improve the platform's technology infrastructure.

Fernandes said: "We have only been in Singapore for a few months, I didn't say I was going to be No. 1.

"We just want to launch, slowly build it up and get more services across."

He said AirAsia has not done much marketing for its food delivery business, but will do so once it sorts out the tech system.

airasia food was launched in Singapore in March with about 80 restaurants. It offered a commission rate of 15 per cent, which was lower than that charged by the three major food delivery operators - GrabFood, foodpanda and Deliveroo.

Restaurants that had initially signed up included well-known names Swee Choon Tim Sum Restaurant and No Signboard Seafood. But both restaurants were no longer listed on the platform when The Straits Times checked on Thursday.

Fernandes cited the example of how AirAsia was built up over several years to illustrate how it would take time for airasia food to get off the ground.

"Grab and foodpanda didn't miraculously have all those orders straight away, it takes time," he added.

"So surely, but slowly, we will get there."

The food delivery business is part of AirAsia's foray into digital services. It had moved to diversify its business following the impact of the Covid-19 pandemic, which has left the bulk of its airplane fleet grounded.

AirAsia also launched a grocery delivery service in Singapore this month. It said it has about 100 orders daily through the service. Deliveries are done through AirAsia's subsidiary Teleport, which has about 800 registered riders in Singapore.

During Thursday's virtual dialogue, Fernandes also offered his views on the outlook of the aviation industry.

He said airlines are "coming to the start of the end" of the crippling impact of the Covid-19 pandemic in the South-East Asia region.

He cited stepped-up vaccination rates among Asean countries, and his expectation that travel restrictions will be eased for vaccinated travellers. Fernandes estimated that borders will start reopening by the end of the year, and that short-haul leisure travel would be the first to benefit.

But in a note of caution, he added: "If you had said to me that 18 months after Covid-19 (started), we would still be locked down, I would have laughed at you.

"But we are, so this is one hell of a pandemic." - The Straits Times/Asia News Network

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