AirAsia X CEO Azran Osman-Rani spoke exclusively to CAPA and revealed the carrier has had unreserved success on its Incheon-Tokyo route, which was launched in 2010. While the CEO remained tight-lipped about the status of the company's IPO and plans to launch a Sydney service, Mr Osman-Rani did confirm the planned Christchurch route will go ahead despite the city's recent earthquake tragedy. Mr Osman-Rani also discusses 2011 progress, aircraft orders, future expansions and social media.
CAPA: What kind of year is 2011 shaping up to be so far?
As unpredictable as 2008-2010 were.
CAPA: Can you update us about the status of the IPO from the last interview?
Sorry, no update on IPO. Our Board and Shareholders have not made any decisions to formally initiate an IPO process. We are still only doing a preliminary evaluation of the option.
CAPA: AirAsia X was launched in Incheon and Tokyo just last year. Has this been successful so far?
Yes, unreservedly. Passenger volumes on these routes have surged with the commencement of our service. Tourist arrivals have also spiked in both markets. We are firm believers in the huge long-term growth from these markets and both feature prominently in our further expansion plans (additional destinations/ports and additional frequencies).
CAPA: Any plans to launch into other markets in the near term?
Yes – but in the near-term we have only announced Christchurch, New Zealand from 1 April – and we are sticking to our plans despite the earthquake tragedy there recently.
CAPA: You have 27 aircraft on order. When will we see those in use? How are these aircraft being financed?
From 2012 right up to 2020. As with the eleven aircraft that’s currently in our fleet, we expect financing to be a mix of operating leases, commercial financing, and ECA-backed financing.
CAPA: How are the plans to launch a Sydney service coming along?
CAPA: Will the A350, planned to operate AirAsia X’s pending North American routes, replace the A340-300s or complement them?
CAPA: AirAsia X has shown a preference for leasing, rather than owning, aircraft. How does this benefit the company?
Not really. We have about a 50:50 mix of lease and owned. Our inherent preference is to own our aircraft. But we’re adopting a mixed strategy for the A330s to take into account a long-term shift in our fleet from A330s to A350s.
CAPA: Why did AirAsia X choose to implement such a robust social media strategy? How is it changing your platform? Is it an effective method of connecting with your customers?
Social media doesn’t change our platform. We still continue to be a direct-to-customer online model, with over 95% of our sales from our own direct channels. We don’t see social media as a primary means of sales/marketing, but for customer relations
CAPA: Do you have plans to develop the strategy over the next few years?
One thing we have learned from 2008-2010 is the paramount importance of flexibility and agility to quickly change strategy and direction to ride different waves of macro-economic changes.
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