Most newspapers headlined their report of Air Asia's meeting with Dato Seri Najib on Friday as a rejection. All except MCA-owned The Star which also reported Minister of Transport Dato Ong Tee Kiat saying the decision will be known in two to three weeks time. It seemed Najib has 'rejected' the proposal but Ong is trying to buy time.
A day earlier, Tony Fernandez went on the offensive in his Malaysiakini.com interview. Tony tried to distance himself from Khairy by expressing regret for sponsoring MyTeam and tried to sell himself as a victim. He went on rampage to repeat his claims or more accurately, lied on the unfair playing field and advantageous situation of MAS. This may shock us with disbelieve when he claimed he didn't asked for the Rural Air Service (RAS). To justify their need to operate their own LCCT, Tony went on to bad mouthed Malaysia Airport Berhad and spewed more lies.
It seems everyone is wrong except Air Asia. Everyone from private individuals, competitors and Government have to secede to his wishes as though he is a God-sent Low Cost Carrier. He is beginning to sound like Shamsul Yunos's sarcastic description of Harris Ibrahim's occupation as Human Rights lawyer.
This new kid in town and bad boy of the local aviation industry emulated a Zam Maidin to call bloggers against his proposal as "sick and twisted". That would include Tun Dr Mahathir which he is willing to meet to explain.
Nothing is more sickening than an Airliner who operate a business emulating a pirate DVD operator, and bragged his blog's high hits as indicative of his popularity. Customers tolerate and some went on to the extent of supporting for the simple reason his product is dirt cheap.
Air Asia is close to a "pirate" because he cheats, lies, and shrewedly "devour" others in such crude manner. Does anyone know Air Asia is not a member of IATA, International Air Transport Association?
For calling disagreeing bloggers as "sick and twisted", it's time to expose how greedy, irresponsible and disorganised the manner he runs his company. He need to be educated that blogging is a personal journal or column shared publically on the Internet. It is not a popularity contest. Clearly he has no tolerance for disagreement and doesn't understand what "agree to disagree" means. Music company executive are very PR-savvy but this British accented ex-executive has a PR style called rude and irritant!
The expose on the lies he has led us to believe will be in my next posting. In the meanwhile, his interview with Malaysiakini.com will be first reproduced uncensured for us to judge. The questionable comments coloured in dark red. There are lots of red!
Q&A: Blogs getting 'sick and twisted'----------------------------
Malaysiakini Team Jan 28, 09 1:29pm
Tony Fernandes in the first of a two-part Malaysiakini’s interview with the AirAsia boss talks about the attacks - at times personal - that have been leveled against him in cyberspace.
Malaysiakini: Other than the proposed KLIA East @ Labu airport, another issue you should be worried about is the impending change of leadership in about two months’ time. There’s talk that you’re close to the present prime minister and Khairy Jamaluddin, his son-in-law. They (the new leadership) could easily, in two months’ time, mothball the project.
Tony Fernandes: One of the main things that has been talked about is AirAsia’s purported closeness (with certain individuals).
I have a hotel business, an aviation business, and a financial portal. None of these really require government approval as far as the hotel and financial portal are concerned. I can get on and do my business. I go and buy my building, I have to get planning permission and approval, off we go.
In my business here (AirAsia), I need routes. In most countries, routes are fairly liberalised. Send your application over and it’s either a yes or no. Most of it is open skies (in other countries). Here, you need to get approval from both governments. And the national airlines (MAS) has an enormous amount of clout.
When AirAsia started, we had two major handicaps. We were competing against a subsidised airline that receives subsidies on their domestic (routes) which range from RM400 million to RM600 million a year. It’s very hard to compete. In the early days, (the global) oil price was US$30, so it was okay. But (the) oil (price) began to creep up. I fought for a level playing-field - remove the domestic subsidies.
In August, it was removed. We had gone to see everybody and all cabinet members and a lot of MPs. We did briefing sessions with MPs to show our situation. Part of that deal was that they gave us the rural air services, which was not (what) we wanted.
I don’t see how anyone can say that (removal of subsidies) is wrong for the country. Taxpayers (now) don’t subsidise MAS. In fact, MAS has become profitable since the subsidy was removed and is competing with us on everything. That’s fair.
The second thing is routes. We lobby (for them just) as MAS lobbies to stop us from getting them. I don’t sit in at post-cabinet meetings. You see in The Edge that the deputy secretary-general (planning) of Ministry of Transport (Long See Wool ) has been appointed to (airport operator) Malaysian Airports Holdings Board (MAHB).
How can that be fair? You know what I mean. MAHB should be made up of independent people. How can anyone be objective when they sit on MAHB’s board and they don’t hear AirAsia’s point of view? This what we’ve been continually fighting (for).
So what have we got from these purported links (Prime Minister Abdullah Ahmad Badawi and Khairy)? We’ve got routes, which I think we deserve and it took me seven years to get Kuala Lumpur-Singapore. I still don’t have Penang-Singapore at this point. I’m still fighting for Myanmar, which MAS objected to us getting. I’m still fighting for more rights in Indonesia, (which) MAS objected to us getting.
Yet, what are we trying to do? Bring in tourists, move people around at cheaper costs. It’s good for the country. There were no low fares when AirAsia was not around. MAS didn’t have these super-cheap fares. If you look at it, where we don’t fly, they don’t have super-cheap fares.
All we got - and we had to lobby everyone for it in the cabinet - was the removal of MAS subsidies. We also asked for routes. I’m still lobbying for routes. Tell me something else we’ve got from this purported relationship.
The biggest mistake of my life, and to be fair to this guy, is (when) Khairy Jamaluddin’s team came to propose sponsoring the MyTeam (football project). Honestly, it was the biggest mistake of my life.
How fantastic - taking guys from the rubber estates, from kampungs, from new villages - to London to play Manchester United. This airline is all about making dreams come true. We’ve also sponsored Manchester United. How great!
But then it backfired because suddenly, it was rumoured that Khairy and the ‘Fourth Floor’ now own 40 percent of AirAsia. Come on!
So, is that true or false?
I hate to sound like a politician, but put a Bible, Quran, whatever, in front of me and I’ll swear on it and say no! I only did the MyTeam thing with him (Khairy). Malaysia has become a bit sick and twisted, if you read some of the blogs.
He doesn’t. I honestly feel sorry for the guy. If he benefited from the MyTeam thing and there are criticisms, fair enough. There’s a whole lot of confusion when it involves Khairy, the old guys, the new guys, the in-between guys, and we just got caught (into it). It’s easy to link us.
Me and (the other AirAsia directors) Kamarudin Meranun initially (owned) 80 percent of this airlines along it, Datuk Pahamin (A Rejab), Abdul Aziz Abu Bakar and Conor (McCarthy).
Over the years, we’ve gone public. Me, Kamarudin, Aziz Bakar, and Coner now own about 32 percent of the company. The rest is probably floated. Our value, our stock, has gone down (laughs).
I’ve tried to buy the company back - that’s no secret - because I think we’re undervalued. That’s my confidence in it. So, if you take me, Kamarudin and then you add in what the Fourth Floor is supposed to own and what Khairy is supposed to own, there’s not much left for us.
Are you still pursuing the (privatisation) option?
We can’t for six months now, but ... I put my money where my mouth is.
If someone were to look at it rationally and say that Khairy Jamaluddin and all the Fourth Floor guys are shareholders, what has AirAsia got (in return)? If you say AirAsia operates exclusively on all its routes and MAS cannot operate on them, (that’s a) dodgy (thing to say).
There are so many dodgy deals and concessions out there, but none of them get hammered. But after this (AirAsia’s sponsorship of MyTeam) had gone public, we get hammered.
If I get all the government business, and I’m the only person that can fly civil servants or for National Service (participants), okay. Under DRB-Hicom, we had the haj contract, which was very valuable to us, and I did it for two years. MAS took that away (in 2003). They undercut us, we couldn’t match it, and it was gone.
But that’s fair competition. No complaints. But you say I’m a crony? If so, I should have been able, with all my powerful friends, to keep the haj contract.
The Ministry of Defence contract (with AirAsia when it was under DRB-Hicom to transport soldiers between Sabah, Sarawak and peninsula), we did it for seven years and gave fantastic service to the Army.
Look who’s minister of defence (Prime Minister Abdullah) now. Yet, we lost 50 percent of the defence contract to MAS. They say we’re so powerful. It’s a big contract. (If we were so privileged) MAS wouldn’t be going around saying, ‘Hey, we won the contract, 50 percent is back (with us)’... So there’s nothing that we’ve got!
Why then are you getting all this flack?
It’s guilt by association. I’m ‘collateral damage’, aren’t I?
Perhaps you’re too successful?
Maybe. People say that. I don’t believe that’s the case. There may be some people who may be jealous, but I don’t believe that. I walk around the streets now, and everyone wants to take photographs, everyone wants (me to) sign caps. People want to be like us. We make dreams come true.
There’s a vicious community of bloggers out there who just spout hate. I’ve tried to engage them. I’ve even invited them here. Look at (Wangsa Maju MP) Wee Choo Keong. He’s a member of parliament. He wants such an airline to fail?
We’re a Malaysian company with 6,000 people. I’ve asked him to come and see us so many times. If you’re objective, you’d come in to see us.
In your experience with government-linked companies (GLCs), with all the monopoly that they have, is it stifling private enterprise?
I work with GLCs, and they all can’t be painted with the same broad brush, but when you compete directly with them, it’s tough. How can anyone say (state investment firm) Khazanah Bhd is objective when they own MAS and MAHB? None of the bloggers have picked that up. They’re willing to bash me and use racial slurs.
There’s one good thing, though, and that’s they’ve called me fat. So now I’m motivated to be thin (laughs). When I read the blogs, I see, ‘Hey Fatso!’ But I’m going to show you I can be thin! (More laughter)
Have you looked at our blog? There are about 1,100 comments.
And most of those have been positive...
And you go look at the Rocky's Bru blog and there are 40 comments… and maybe 30 by vested interest parties. I want to just define the criticism. It’s a myth that (the opposition to AirAsia) is all over the place.
You’ve got a pretty formidable detractor in the form of (former prime minister) Mahathir (Mohamad).
Dr Mahathir gave us the (airline) licence and we owe him a lot for giving us the licence. I don't think he detracts against us, I mean if you read it (his Cet Det blog), he detracts against the (KLIA East @ Labu) airport plan. But he hasn’t heard all sides of the story. I don’t have access to him and he doesn’t see our problems. I dare say he has not even been to the LCCT. And so maybe when he’s given a chance to see…
In his blog, has congratulated AirAsia for having received such high numbers of passengers. He congratulated on our presentation (on Labu). He still has questions, and his and a lot of other people’s views are ‘why can’t it be built here (KLIA)?’ And we're trying to argue that the 'why', (and) articulate it.
It’s not our first desire to move out of here. Our first desire is to be in (Sultan Abdul Aziz Shah Airport in) Subang. And in fact, even Dr Mahathir asked, ‘Why can’t we be in Subang?’ I would love to be in Subang.
Tun (Mahathir) is very learned, he gave us the chance - we have built this airline. Hopefully we will be given a chance to show our side of the story.
[Note: What an insult to his resoursefulness and intelligence! A case of an uncultured that could not understand a Malay sindir (tease).]
Are you willing to meet him, talk to him?
I’m willing to meet all the bloggers (to address their concerns with KLIA East @ Labu). (Laughs) I’m definitely willing to meet Tun.
Q&A: Fernandes pours out his frustrations
Malaysiakini.com Jan 29, 09 12:42pm
AirAsia chief executive Tony Fernandes let loose on his frustrating battles between his budget airline and government-linked agencies in this second of a two-part interview.
Malaysiakini: With the new KLIA East @ Labu you are racing against time. Though the cabinet has given the green light, it's not yet a done deal. Are you worried?
Tony Fernandes: Yes, I am worried about it. This whole thing has been done with a lot of time pressure. In 2010, we forecast we'll be four million passengers short in terms of terminal capacity and about 17 planes short of parking. Right now, we're a million passengers short in this terminal, and it's a nightmare. And four million is not even worth thinking about. I think it will come to a head, one way or another.
We're a point-to-point airline. We don't have night stops. All our Airbus A320 aircraft come back at night. The only planes that are flying around are the long-haul ones, the 25 Airbus A330s. They won't be there all at the same time. But the A320s will come back every night and need to be parked. We'll have some planes in Johor Bahru and we'll have some planes in Kota Kinabalu overnight. And hopefully we'll have a hub in Penang.
And the second part is charges. I need low charges to stimulate someone from China who never thought of going to Penang. Why have we developed Manado (North Sulawesi in Indonesia) and all these other weird and wonderful destinations? Because there's low fares. So people say 'come on let's try, I never tried Manado, let's go - RM50'.
In Kota Kinabalu, it's the other way around. They built us a low-cost terminal and now they want us to move out of there because they say the other terminal is empty. We didn't ask them to go build a massive terminal in Kota Kinabalu so it's not our problem. Why should we move?
Ask Malaysia Airlines (MAS) to do more flights. You're the airport authority. Go and attract lots of airlines. But if you charge everyone the same, if you don't do any marketing, if you don't work with the airlines, then who is going to come?
In your experience with government-linked companies, with all the monopolies that they have, is it stifling private enterprise?
I don't think it's fair. Look at where we are (Low Cost Carrier Terminal in Sepang)! Go ask the taxi drivers - it's RM35 to get to the main terminal (in Kuala Lumpur International Airport). There is no train here. You try taking the bus between the two terminals.
Now suddenly, everyone's concerned about connectivity. There was none here. We were like ostracised people thrown here and we've fended for ourselves.
If MAHB (airport operator Malaysian Airports Holdings Berhad) was so concerned about connectivity, why is there no airside transport? That is, you come off a flight from Sydney, and you don't want to go through immigration, your bag should be automatically transferred to this terminal and there should be a bus on the airside to take you to this terminal without having to go through passport control. But now you have to pay airport tax twice if you transfer. No one has even talked about that.
I was like a broken record saying, 'Train. Train. Train. Train. Train.' No one listened, so I said, 'Screw it'. We'll build our own long-haul airline - AirAsia X. MAS didn't want to work with us. MAHB didn't do anything for us. I could be in Timbuktu, and we'll survive.
Can I add one more point on this connectivity issue? Why is (MAS’) Firefly allowed to be in Subang? And don't tell me it's a turbo-prop. Turbo-props move human beings. If Khazanah is so worried about hubbing and connectivity, why aren't those passengers here? What's the connectivity between Subang and KLIA? There is none.
You’ve been fighting a running battle with MAHB. What are your major gripes?
My major gripe is we're overcharged. It's like saying my budget Tune Hotel should be charged like Mandarin Oriental. It's different. We don't have lifts here (LCCT). We don't have walkalators here. My passengers have to walk all the way to Phuket to get to the plane.
Passenger comfort here is seven meters per person. (The) main terminal (in KLIA) is 65 meters. This is a fact told by MAHB. MAS advertises that fact. You have a nice terminal. You don't get wet. If it rains really hard here, we can't board!
We accepted that because we said, 'give us low charges' and we will suffer. We don't mind because our passengers have never flown before. Give them low fares, they don't mind walking.
There's been lack of foresight and planning. We asked for this terminal's extension to be built by October 2007. Not done, because they requested money from the government, and the costs were high and the government kept saying it's too high, they have to bring it down. As of today, it's still not ready 18 months later.
And we're being overcharged. (The) passenger service charge, initially it was the same as the main terminal. How can you justify that? I fought really hard, and it came down to RM25. I still think it's too high for what we get. (Greedy?)
[Notice the repetition of overcharging to make his lies convincing.]
What was the original charge?
RM51. When I go to develop routes like (between) Langkawi and Bangkok - I said, let's try, may be Thais are fed up with going only to Phuket, it doesn't cost you anything. If my plane comes down, there's no incremental costs because your lights are turned on, your security guards are all there... they said no. I still did it, though I failed. I needed low fares.
So who loses? The country loses. MAHB loses. That's the kind of frustration we've had all these years. We have developed 36 new routes in this airport. You want to go back to the hub principle? What hub? What airlines are available? You compare KLIA with Changi and Bangkok - there are so few airlines coming here.
In Australia, apart from Singapore Airlines, we're voted as the most popular, most well-known, airline. We're above MAS, Cathay, Emirates, Thai. And we've only been going there for a year. We spend a lot of money promoting Malaysia.
If I live in a rented house, the landlord is good, the rate is cheap, why would I want to move out? The last thing I want to do is build an airport. It's desperation that we've reached this situation. I didn't want to start a long-haul low-cost carrier either. [This is the biggest lie. They have expressed request to have their own airport from day one.]
Isn't building a new airport a very costly way of solving this problem?
It's like independence. You treat a country badly, they'll want to break away and secede. After three years with MAHB, now allow us to be a Republic of KLIA East. We control our lives. No more bitching. ‘You think you're so good at running an airport, you go run it yourself.’ You think I really want to do it?
You know that there will be people who will be fighting against this act of secession?
Of course. I dare say that if Khazanah (government-linked company which owns MAHB and MAS) was in its present structure when I started AirAsia, we would have been dead. Very direct, but very true.
Khazanah may have said, as they're saying right now, there's no need for AirAsia. MAS can do a low-cost carrier. Would the people have benefitted?
What Khazanah and MAHB have been saying is that you should be following the National Airport Masterplan (which included the plan for a new LCCT terminal). AirAsia was consulted, they say, the plan was recently reviewed.
[Khazanah supposedly takes care of the interest of the nation in its investment. Tony care for the nation or his greed?]
So why are you suddenly changing? Haven't you been consulted?
As of last week, we've just been given diagrams of what their terminal would look like. If you've looked at the terminal that they've come up with, it's a three-level airport. We would never ever go with something like this.
I disagree on the consultation. There is generally a one-way discussion with MAHB. Except with the (existing) LCCT, there was a lot of consultation - there was a good partnership - but with this new one, we don't know anything about it. We disagree with the area. There is no infrastructure in the area. [Should MAHB only cater to Air Asia's needs? Spoilt brats!]
Only when we started with KLIA East @ Labu did this National Airport Plan suddenly come out. What is the cost of this? Have you heard any number on the cost.
I've been transparent: RM1.6 billion. Has MAHB come up with a figure for their new low cost carrier terminal? Who's going to pay for it? Ultimately, the airlines will have to pay for it. That's why we are objecting.
The National Airport Plan that we saw will be a disaster. Has the Express Rail Link (ERL) been built? Has it been agreed to? I spoke to ERL, and they don't know.
So, what consultation? I think you should at least say - this is what it's going to cost, this is what it's going to look like, what are your views? None. Their consultant, we heard, said that our passenger forecast is never going to happen. What do you mean? We're the ones that bought the planes. We've beaten the forecast every time.
I have letters to show you that when they built this terminal, we said it's too small. MAHB has said that we said we wanted 10 million (passengers). But I can show you the letter that says it's too small. So I don't agree with that statement for one bit. They haven't consulted us. Partnership is about consultation. Why should we be leaving if we're happy? Why? Why should we want to leave?
I mean this is the last thing we want to do. Yes, there will be detractors. There have been detractors from AirAsia from Day One. I've had to fight to get Kuala Lumpur-Singapore (route). Cars can go there. Buses can go there. But AirAsia cannot. Explain that to me.
An airport is critical to an airline for growth, especially if we have global competition. Tiger Airways gets everything it wants from (the) Singapore (government) straight away.
What does it take for AirAsia to continue their operations in KLIA?
What would make us stay? Low charges and an airport we believe can be done at the right time, (and) on time.
We have the worst financial crisis in the history of mankind so do you think I really want to go out and take on another challenge? I think we will die if we don't resolve it. There won't be an AirAsia. It's that serious. So what do you do? You take things into your own hands and you try and do something. [It is because of the financial crisis they need an airport to deceive investors with a story of future growth.]
It's when I discovered that the other terminal was scrapped and they talked about this being ready in 2014, I panicked. I literally panicked. I was on a flight coming back from Hyderabad. I went round looking all over the place for land.
We looked here (at KLIA), this was our first port of call. We talked to the government about can we build something here? We couldn't really find anything that we thought could be efficient. It was just swamp land and it would take one year to fill it up and RM400 million.
Then suddenly Labu came along. So we thought: great, the government can't object to that. It's right by KLIA so there's connectivity. We'll privately fund everything. It was wonderful, Labu as we were saying.
You can open up so much tourism because of Malayan Railways (KTM). We can get people up to Gemas now and up to Perak. People from Seremban can come and not pay RM35 on the ERL. [Care to explain why Air Asia cancelled Ipoh operation within a month after requesting much spending on the Airport?]
No low-cost terminal has been built throughout the history of aviation. They have always been adapted. So we have a full, complete, wonderful airport plan. We've got a whole new system. It'll be like a shopping arcade. Less check-in desks, etc. Easier passenger flows.
If we have a tropical kind of airport with trees, it would be cooler. We used solar technology a lot. And lots of people want to use it as a showcase. We can get a lot of the technology for free. From General Electric Corp and all these guys, solar panel guys want to do it. They know 20 million people will fly through this terminal.
We're going to have a major bus transport network. So that when you touch down, if you want to go to Malacca, bus there. You want to go to Kuantan, bus there. You want to go to Taman Negara, bus there. You need good ground infrastructure.
I wanted to have a free taxi system - not coupons - so that anyone who comes in, any taxi can come in. They don't have coupons anywhere else in the world. If you want to come in - it will be much cheaper - you can come in and pick someone up, just join the queue. But you got to be in the queue, to be fair to everyone. Great bus, great train, it will spur tourism. [Who is spending for it? Is it not duplicative capital spending?]
And then the Vision Valley (a project to be developed by Sime Darby Bhd next to Labu), to me is fantastic. I've already bought in because education is a passion for me. My dream is that we have an education city that has Chinese universities, European universities, Indian universities and Malaysia becomes a centre because of our language capabilities, which is another topic for another day.
I believe we should push our brand that we're multicultural and I think every kid should learn Malay, Chinese and Indian. That was my dream and having a low-cost carrier you can fly and it becomes much easier.
What do I have in KLIA? But if I had the Vision Valley there and some control of our own to make it, there would be an extra reason to come to Kuala Lumpur.
Look at Singapore. They have cinemas in their airport, swimming pool, golf club next door. Taxi service is impeccable. You come in, the taxi driver is standing there with the boot open. I can do that. I can do Singapore. We have.
Tiger Air has eight planes, we have 75. Tiger Air has Temasek, Singapore Airlines, TPG - the biggest private equity house - and the Ryan family. You cannot get better shareholders than that. Yet with all the obstacles put in front of us here they have only got eight planes and we have 75.
We want to be charged fairly. We want the owners of MAHB to be objective - not to wear two hats, an MAS hat and an MAHB hat. Objective to what AirAsia wants and will disaffect MAS.
Talking about privatising infrastructure, couldn't AirAsia abuse its monopoly or go bust leaving Malaysians with another white elephant airport?
That's a fair concern, but the question is: is there a choice? (MAHB) is a monopoly. Ultimately, if I'm overcharging at KLIA East @ Labu, who the hell is going to come? There is a choice. There are two choices. There is Firefly and there is MAS here.
What I'm saying is, as opposed to toll roads, etc, people have a choice. But if ultimately we try to rip off everyone, people can walk across to KLIA.
In terms of bailout, we've seen a lot of that. The entire banking industry in America (was bailed out) and America is virtually a socialist economy now. So it is all about if you have faith in a company and its ability to manage itself. I can't guarantee you that this is the case. But I'll just let our track record speak for itself. MAS has been bailed out three times.
And when you have a terminal that we believe we can build at less than RM1.6 billion because steel prices now have come down with our own runway and we think about the ancillary income.
We got a hotel right across the road. I forgot, there is another attraction here (LCCT), a hotel. (laughs). Hey, I own that hotel yet I'm prepared to move out of here. So my CEO of hotels is like: 'what am I going to do?' I don't know. You got to be creative, right? (laughs)
We've been able to make an airport hotel work at RM30 a night. Where in the world could you ever do that? Tune Hotel (in Kuala Lumpur), which is a former hospital, it's full every night. They say they got ghosts in there, so free entertainment also! (laughs) What's wrong with that?
Let’s talk about the AirAsia's balance sheet. You’ve suffered your first losses (RM465.5 million in the third quarter) due to (global oil) hedging.
We’re looking very good for the fourth quarter and I think all that we did is realise losses that every airline has been sitting on. I think we were smart, to be honest. When we hedged at US$77 it looked fantastic. They were all talking about oil being at US$200 (a barrel).
So when it all started coming down, I said to (AirAsia director) Kamarudin (Meranun), let’s get out of this. Otherwise, we could have a real problem coming if oil goes down to US$40. That was my target. He said no, no way. I just said, get out of it. Take the pain.
So we paid US$21 odd million to get out of one trade and another US$21 million to get out of another trade. Other airlines are still paying oil at $95.
So I just recognised the losses, which is a lot less then if I continue to pay for oil at US$77. I’d have a huge mark-to-market loss. Cathay Pacific had mark-to-market loss of US$1 billion. Southwest Airlines, one of the most successful airlines, has hedging losses of US$700 million. So we took the hit. But we’re clean now.
It’s a crazy market out there. But we took a little short-term pain. We have a little more pain in the fourth quarter. Then we’re clean. We’re transparent. Many companies here don’t have mark-to-market. You don’t have to report mark-to-market. So there are some companies here who have huge mark-to-market losses.
According to Malaysian accounting standards, there is no need to report mark-to-market. So if every airline and other company reported mark-to-market, they would be sitting on a massive loss. But we just took a hit, cleaned it up and we’re being transparent about it. [Strange he claimed that he took a lost and yet discuss at length about mark-to-market.]
The Star, Saturday January 31, 2009* Edited 4.20 pm
Decision on Labu LCCT plan soon
KUALA LUMPUR: The decision on AirAsia’s proposal to build a new low-cost carrier terminal (LCCT) costing RM1.6bil in Labu, Negri Sembilan will be known in two to three weeks’ time, said Transport Minister Datuk Seri Ong Tee Keat.
“Actually, the Government has not made a decision on the matter. What is important is that all the fact-finding and details arising will be scrutinised,” he told Bernama after attending a Chinese New Year dinner function organised by the MCA, here, last night.
Ong said the Government needed time to decide on the matter as it involved many parties.
“The Transport Ministry, Economic Planning Unit, Finance Ministry, Malaysia Airports Holdings Bhd (MAHB) and AirAsia are meeting for the good of all parties concerned,” he said.
Bernama had earlier yesterday reported that the Government had rejected the proposal for a new LCCT in Labu, but the low-cost carrier was said to have several concessions, according to sources.
It was reported that MAHB would be given the responsibility to build a new LCCT near the existing terminal, which is next to the Kuala Lumpur International Airport (KLIA) in Sepang.
The sources were also quoted as saying that the decision to cancel the proposed project was conveyed to AirAsia at a meeting chaired by Deputy Prime Minister Datuk Seri Najib Tun Razak and was attended by Finance Ministry, MAHB and AirAsia officials.
At the meeting, AirAsia was led by its group chief executive officer Datuk Seri Tony Fernandes.
In a statement issued after the meeting, Tony said AirAsia regarded the outcome of the meeting as very positive and that it was now awaiting the details.
He said AirAsia was committed to providing its guests with world-class, five-star service via a purpose-built LCCT.
He said AirAsia was also committed to making Kuala Lumpur a regional hub for low-cost carriers and contributing significantly to the growth of Malaysian economy.
Financially, it is also good news for AirAsia, he said.
It already has a high gearing, and with this it does not have to seek funding for the new LCCT, he added. — Bernama