AirAsia X Executive Chairman of Capital A and Founder Datuk Kamarudin Meranun withCapital A President (Commercial) Colin Currie and AirAsia X CEO Benyamin Ismail during the official launch of four new routes to Japan and Hawaii.
KUALA LUMPUR: The AirAsia group, comprising Capital A Bhd
and its sister company AirAsia X Bhd (AAX), has reiterated that refunds to its passengers are in line with its debt restructuring process.
It argued that passengers were not fully compensated in cash because they were categorised as creditors.
The refusal of AirAsia to refund the affected customers in cash had been a source of discontent and frustration on social media.
The controversy had also caused the Malaysian Aviation Commission to issue a statement last November, urging AAX not to classify its customers as creditors. The commission had also threatened to exercise its statutory powers if AAX failed to reimburse its customers.
In a joint-press conference by Capital A and AAX yesterday, AAX chief executive officer Benyamin Ismail stated that legally the low-cost airline was unable to give out cash refunds to its affected customers.
“AAX just went through a court restructuring process. Under the law, we cannot give cash refunds to anybody, including the creditors.
“The travel vouchers are given out of goodwill. We are giving to our customers one-for-one refunds for the price that they paid for the tickets,” he said.
In addition to the travel vouchers that will be valid for five years, AAX would be paying 10% of the ticket value in the form of cash payment, he said.
This means for a ticket value of RM1,000, AAX will be paying back RM100 cash.
“It will be deposited into their bank accounts by March 2023,” he said.
Speaking to reporters during an event to “relaunch” AAX yesterday, Benyamin said AAX has refunded about 80% of its customers with travel vouchers. The remaining 20% customers will be refunded within the month.
The budget carrier announced that it would be flying from Kuala Lumpur to London, Dubai and Istanbul this year to recapture profitable long-haul routes.
AAX is offering flights to Dubai and Istanbul for the first time.
Benyamin said four new medium-haul routes to Japan and Hawaii have also been launched.
More destinations are in the pipeline and would be announced soon to meet the strong pent-up demand, he added.
“As our services grow, we will continue to bring our fleet of aircraft out of hibernation and, we can look forward to gradually bringing back our valued pilots and cabin crew.
“I am confident all of our resumed or new services will be very popular and we will return to pre-Covid-19 capacity on some of our core routes within the next 12 months.
“Our strategic new model, combining cargo and passengers, enables AAX to fly profitably where other airlines may not be able to do so.
“It makes operations to longer-haul routes like Dubai, Istanbul and London commercially viable and more affordable for our guests at the same time,” he said.
Looking ahead, AAX’s prime focus would remain on medium-haul flights but it will also serve long-haul routes with high commercial viability.
“We saw the pent-up demand for Europe, especially London. We are able to restructure the business at a cheaper cost, it would be more feasible to do it,” he said.
AAX will only offer long-haul flights to London and Istanbul.
“I don’t think we will be adding anymore. I think these are the only two locations that would work in Europe,” he added.
On airline fares, Benyamin said the high fuel-price environment would cause fares to be “slightly higher”. This is on the back of the fuel surcharge imposed on the passengers.
Nevertheless, he highlighted that AAX would continue to ensure that the fares are affordable for its customers.
“As soon as fuel prices come down, it will become much cheaper to travel,” he said, adding that AAX would only go back to its pre-Covid-19 capacity after the company turns profitable.
“Internally, we projected to reach pre-Covid-19 capacity in two years, but if the market rebounds back faster, we’ll accelerate that,” he added.
Meanwhile, Capital A president (commercial) Colin Currie said the airline landscape would make a “V-shaped” comeback as more countries relax their travelling rules.
“We really do see the demand and we’re very optimistic,” he said.
Currie pointed out that Capital A aims to put a total of 202 aircraft in operations.
“Pre-Covid-19, it was over 200, but the number of aircraft is slated to be about 178 in the fourth quarter,” he added.
