AIRASIA: FLYING LOW-COST WITH HIGH HOPES

In this case study, a research on a low-cost airlines based in Malaysia which is Air Asia was conducted by Asia Case Research Center of Hong Kong University. The airlines company was in huge debt since it competes with Malaysia Airlines on which airlines offer lower fares to their customers. Thus, Tony Fernandes decide to take over the business to improve the structure and generate profitable income through no frills airline known as low-cost carrier (LCC). He saw a great potential for an LCC airlines service where it has been successfully being conducted in the western countries. So, he tried to create the first airline in Asia that have low fare and no frill concept by reconstructing the current Air Asia that he had bought.  

Besides, Air Asia also introduces a fully ticketless travel and implement free seating policy. With the new structure of Air Asia, the fares are stated to be 40% to 60% lower than it's rival Malaysia Airlines under the tagline "Now Everybody Can Fly". On the other hand, it has its own multilingual website where they can attract travellers and tourist to purchase tickets which may offered discount for certain types of destination. In my opinion, the "Easy to Book, Easy to Pay & Easy to Fly" commercial is one of the most brilliant idea that being proposed from Air Asia since it make traveller from all over the world more convenient to travel to their desired destination. 

Next, Air Asia also provides domestic and short-haul services within the neighbouring countries. Air Asia joint ventures with Thailand's Shin Corporation and  Indonesian hub to gain easier and cheaper access to other South-East Asian countries and the lucrative Chinese market. Thus, Air Asia not only broadened their flight destination but also increase the number of passengers to their business. It is said that Air Asia makes the largest domestic national airline in Malaysia which took over more than two-thirds than their rival, MAS. In addition, Air Asia's high-flying success in terms of it rapid route expansion and profit inspired many potential LCC followers in Asia-Pacific region.

In early 2007, Air Asia became first airline in Malaysia to offer an internet check-in service, allowing domestic traveller to enjoy online check-in and printed their own boarding ticket. Moreover, passenger could also pre-book their checked baggages  for a lower rate. Air Asia also served their passengers cozy leather seats and in-flight hot meals which offers  a variety of Malaysian and Asian delicacies. These complimentary from Air Asia not only attract more tourist and locals but improve their services far from an LCC provider. 

DISTINCTIVE IMAGE & LEADERSHIP 

Air Asia has become one of the most drastic airline company and expand its flight route to many countries. From a three-aircraft operation to 72 owned aircraft in 2008 with over 100 routes, it shows how great the leader organizing his company. It can be said that innovative and risky strategy are worthy to promote the business allowing profitable income to be generated. As the chief executive officer of Air Asia, Fernandes himself was a walking advertisement for the company by wearing Air Asia's official red caps and T-shirt on many occasions. Air Asia also receives several local and international accolades for its service excellence and success in brand-building, business management and leadership. Thus, it was recognize as the best LCC in Asia region whilst maintaining the lowest cost structured airline in the world.

PRICE WAR WITH MALAYSIA AIRLINES

Air Asia became a real threat to the former monopoly operator with the emergence of more-value conscious consumer who were more receptives to low-cost, no-frills concept. On 6 May 2008, MAS launched its unexpected "Everyday Low Fare" campaign offering 1 million free seats for its domestic flights and other short-haul routes within South-East Asia. However, the campaign was strongly opposed by Fernandes stated that MAS turning into an LCC and concentrating its low-fare promotion on Air Asia routes. Air Asia fought back with its "Sub-Zero Fare" campaign offering ticket prices below the prices offered by MAS. As of 29 May 2008, Air Asia recorded its 25th consecutive quarter of profitability since 2002.

DIFFERENCE BETWEEN AIRASIA & AIRASIA X