AirAsia X – the long-haul offshoot of Asia’s biggest low-cost carrier – has begun ramping up the services it offers from Australia, connecting the main east coast cities with Bali for the first time.
The announcement on Monday October 27, that it will begin five weekly services from Melbourne to Denpasar on December 26th this year in competition with Jetstar, Garuda and Virgin Australia is a major escalation of the fare and capacity war that started on routes between Australia and Bali around six years ago.
Since 2008, Australian travel to Bali has more than tripled, with fares from east coast cities tumbling to as low as A$300-A$400 return, and will soon exceed one million holiday-makers a year.
AirAsia X has no reservations about the new competition it is bringing to the Bali route as its costs are the lowest of all the competitors and it would win any fare war.
In any case, the new Melbourne-Denpasar route joins more of the dots in its bigger trans-Asia strategy.
“There will be some short term turbulence as everybody adjusts to the new capacity, but we’re very confident the market will respond and fill up the additional capacity,” AirAsia X chief executive Azran Osman Rani told AirlineRatings.com
“We’ve seen that very clearly with Indonesian AirAsia services to Perth and Melbourne has a lot more to offer in terms of the population size.
“But equally important this is not a service primarily reliant on people coming to Bali.”
The details are still to be announced, but the five weekly Melbourne-Denpasar flights will connect with onward services to north Asia, as well to cities in Java already linked to Bali by local affiliate Indonesia AirAsia.
“AirAsia X is a connecting network model and we’re hoping to get a lot of people in Jakarta, Surabaya and Bandung using Bali as a gateway to come down to Melbourne,” Osman-Rani says.
“And, with this specific flight, the airplane when it returns to Denpasar from Melbourne will go on to North Asia.
“It means we can get people from Australia who are keen to get to Korea, Japan, China, Taiwan [travelling with us]. A lot of them have been using hubs like Bangkok, Singapore, Kuala Lumpur, which is more of a detour compared with the straight line down to Melbourne via Bali.”
Details of onward AirAsiaX services from Bali to north Asia are expected to be announced in December when the airline takes delivery of its second Indonesia-based A330-300.
The airline initially planned to first set up a base in the Indonesian capital Jakarta, but it’s understood the airline has struck trouble in dealing with overcrowding and the availability of scare takeoff and landing slots at the capital’s Soekarno Hatta airport.
AirAsia X has followed a strategy of setting up operations wherever the AirAsia parent already has domestic networks, the biggest of which, outside of Malaysia, are in Thailand and Indonesia.
Thai AirAsia X set up a base in Bangkok earlier this year with two A330s and now flies from the city’s Dan Mueang airport to Seoul, South Korea, and Osaka and Tokyo, Japan.
Thai AirAsiaX will take delivery of three more A330s in 2015, when it is expected to announce its first flights from Bangkok to Australia.
AirAsia also has new subsidiary airlines being established in India and Japan.
Jetstar escalated the fare war with AirAsiaX, announcing it would offer one-way fares from Melbourne, Sydney, Brisbane, Adelaide, Darwin and Perth to Bali from A$88.