FARNBOROUGH—AirAsia signed a firm order for 100 Airbus A321neos, in a bid to cope with slot scarcity in Asia and at a time when exuberant group CEO Tony Fernandes believes the carrier has weathered a period of uncertainty.                                                                       

Deliveries are scheduled to start in 2019.

“We want to maximize our slots,” Fernandes said on July 12 at the Farnborough International Airshow. He referred to an airport infrastructure problem that is taking place “everywhere in Asia,” specifically mentioning China, Hong Kong, Indonesia and Phuket, Thailand. “Low-cost carriers have exploded growth and airports have not kept up,” Fernandes said. It will take another five to six years, at least, for them to catch up, in his view.
 

AirAsia expects the 50 additional seats that the A321neo provides (over the A320neo) are the solution for now. The company is planning on maintaining a 25-min. turnaround time.

Fernandes predicts his company’s annual passenger traffic will grow to 100 million from 60 million “in a not-too-distant future,” notably thanks to the type. Each of AirAsia’s A321neos will seat 236 in a single-class configuration. The engine has not been chosen yet but Fernandes, alluding to the already ordered 300 A320neos, noted he has not opted for Pratt & Whitney turbofans.

He praised Airbus’s executives for having been amenable to deferring some deliveries in the recent past. “Fabrice [Brégier, Airbus’s CEO] believed in us at a time when many people were writing AirAsia off,” he says. The airline’s load factor has been improving of late. It rose by 8 percentage points to 85% in the first quarter, compared with the same period last year.

Therefore, AirAsia is next year projected to be back to its “usual growth of 15 aircraft per year.” Deliveries may be twice as fast, as they will encompass additions and replacements.

In India, Fernandes is hoping some regulatory changes will prompt traffic growth and thus a further aircraft order. “We are growing the market; there is massive potential in connectivity between secondary airports,” he said.

The airline is gearing up to start operations in Japan by January.

Overall, it is betting on ASEAN (Association of Southeast Asian Nations) countries gradually moving to open skies policies. Fernandes said he wants to make the most of that hoped-for trend, “not by flying from Beijing, Shanghai or big [cities]” but rather by developing secondary routes.