AirAsia X: London will be first

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August 22, 2016
AIrAsia Avalon Australia

Asia's biggest long-haul low-cost carrier AirAsia X says it will return to London in 2018, following its Singapore competitor Scoot's decision this week to launch its first European services in 2017.

Scoot will fly from Singapore to Athens four times a week from June 2017 with its launch offers marking the return of ultra-cheap fares on the world's longest air route between Australia and Europe.

Scoot's offer of a one-way seat from east coast Australia to Athens for $A419 are similar to the $A800 return fares from Sydney and Melbourne to London and Paris when AirAsia X last flew there before services were terminated in 2012 – roughly halving existing fares in those markets.

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AirAsia X chief executive Ben Ismail is waiting on the delivery of the first of 66 new ultra-long-haul Airbus A330-900 neo (new engine option) jetliners from 2018 before announcing details of European services, but told AirlineRatings.com London will be the first destination.

Only the airport remains to be decided: AirAsia X last flew to London Gatwick airport south of the city before launching its first flights to Stansted airport, north of London.

"For us, it's all about the airport deal," Ismail says. "If we can find a very attractive airport deal with good takeoff and landing slots, we'll go for that.

"We're confident we can stimulate any airport that we go into so (in London) it may be Stansted, it may be Gatwick or, if I'm the luckiest person in the world, Heathrow would be great." 

Ismail says AirAsia founder and chief executive Tony Fernandes "has done very well in the past trying to find routes that are very sexy where everyone dreams to go". 

"Last time, Paris was filling up, London was filling up – they were the two places people wanted to go," Ismail says. 

"The only issue in the past was the cost of operations was very high. Even though the yields (average fares) and the loads were very good, it was still not enough to break even. With the new aircraft, I'm quite confident we can make some sort of money."

Ismail says that, in the long term, the airline will look at other Euro destinations, such as Rome and Frankfurt. The AirAsia X chief also says the group won't shut down its Indonesian subsidiary, which this year axed its four weekly A330 flights from Melbourne and Sydney to Bali because of heavy losses. The flights will end on September 1 and there appears little chance they will be restarted in the near future.

Though Indonesia AirAsia X has separate ownership from its short-haul cousin, Indonesia AirAsia, it has faced serious regulatory problems with the Indonesian Government since the short-haul  affiliate crashed an Airbus A320 in December 2014, killing all 162 people aboard.

"We're trying to look at the business entirely – how it's going to fit into the whole vision," Ismail says of Indonesia AirAsia X, which now has just one route – from Jakarta to Jeddah, Saudi Arabia, launched in December 2015. 

"We're reviewing it with regulators there to see how we can move forward. It's still going to exist but whether it's going to fall within one company or two, we don't know yet."