Badly burnt by the travel downturn, AirAsia is attempting to reinvent itself. The airline doesn’t want to be just an airline. It wants to be a lifestyle brand. But it’s a big jump from being a low-cost airline to being a business that might help your day run better.
Still, AirAsia is keen to have a go. In recent months, several announcements and initiatives about AirAsia’s transition from airline to lifestyle brand have been announced. Over the weekend, there was another out-of-the-box surprise – AirAsia will get into the flying taxi business.
This is an opportunity to recast our business, says AirAsia CEO
Speaking at the Youth Economic Forum in Kuala Lumpur on Saturday, March 6, AirAsia CEO Tony Fernandes said the travel downturn was an opportunity.
“It’s a once in a lifetime opportunity to recast your business,” Mr Fernandes said. During a wide-ranging discussion, the CEO spoke of the airline’s transformation and diversification away from its core business of low-cost flying around Asia.
After speaking about AirAsia’s move into drone deliveries in Malaysia, Mr Fernandes surprised the forum, saying; “AirAsia is not far away from air taxis. We’re working on that right now.”
As the AirAsia boss sees it, it’s a logical step for the emergent lifestyle brand. “We’ve got pilots. We understand propulsion, we understand navigating the skies. We have a team now working on that.”
We’re getting into the air taxi business, says Tony Fernandes
Tony Fernandes’ announcement was met with some bemusement by the interviewer, Dato’ Charon Mokhzani, Group Managing Director of the Malaysian Industrial Development Finance Berhad.
“You’re getting into the flying car business?” Mr Mokhzani asked. But Mr Fernandes prefers to style the proposal as a flying taxi business.
“We’re about a year, a year and a half away from launching,” he said. When asked about the aircraft type, Mr Fernandes said his aerial taxi business would use piloted quadcopters with up to four seats. Naturally enough, you’d hail your AirAsia air taxi using AirAsia’s app.
According to Tony Fernandes, the quadcopters he wants exist right now. “They’re being tested right now,” he said. “Three or four big companies are doing it, and we’re working with some of them as we speak.”
A few hurdles to overcome for AirAsia
The AirAsia CEO may be striking an upbeat tone, but all is not well at AirAsia. The airline recently posted its fifth straight quarterly loss of US$111.4 million. Its long-haul arm, AirAsia X is in dire trouble and under bankruptcy protection provisions. Last month, AirAsia Japan also commenced formal bankruptcy proceedings.
A 12 to 18-month timeframe to get an air taxi service up and running in Malaysia might seem ambitious. It’s not the first time an urban air taxi service has been proposed. A start-up business in Hong Kong wants to run an air taxi seaplane service around the Greater Bay area.
Uber made a splash a couple of years ago, announcing autonomous air taxi services were imminent in several cities worldwide. That idea has since been quietly shelved.
But where Uber and AirAsia differ is AirAsia plans to use piloted air taxis, and the rollout will be across AirAsia’s home territory, Malaysia. Aside from the regulatory hurdles, while people may be prepared to ride a pilot quadcopter, how many folks are willing to board an autonomous one remains unanswered.
The AirAsia air taxi idea certainly sparked the interest of Dato’ Charon Mokhzani.
“That would be cool,” he said.
