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AirAsia's Tony Fernandes Rejects Talk of Rivals Absorbing Its Malaysia Capacity
AirAsia co-founder Tony Fernandes has dismissed reports that Malaysia's government was weighing whether rival carriers could take over part of the airline's domestic capacity, calling the claims misinformation.
Speaking at a press conference in Bangkok on Friday during a tour of AirAsia's Southeast Asian offices, Fernandes told reporters and investors that competing airlines could not simply take over the routes the carrier operates.
He described as "misinformation" reports that Malaysia's government had been discussing whether rival airlines could absorb some of AirAsia's domestic capacity. "You can't just step in," he said.
Fernandes argued that competitors could neither automatically absorb that capacity nor replicate the cost structure that underpins AirAsia's fares, which he presented as central to its position in the Malaysian market.
The carrier has been cutting routes and returning aircraft to preserve cash as jet fuel costs surge, increases Fernandes attributed to the Iran war. Those higher fuel bills, alongside liquidity concerns, are testing the advantage AirAsia has held over rivals eyeing its domestic footprint in Malaysia.