AirAsia X plans budget flights between Malaysia and UAE

One of Asia's biggest budget airlines in planning a new route to connect the region with the UAE.

Tony Fernandes, the chief executive of AirAsia X, has been dubbed Asia's Sir Richard Branson.
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Travellers to South East Asia are expected to have a new budget airline choice early next year when AirAsia X plans to restart flights to the Emirates.

Tony Fernandes, the Malaysian entrepreneur and chief executive of the airline, who has been dubbed Asia's Sir Richard Branson, said the company had started the process to begin flights from Kuala Lumpur to Dubai or Abu Dhabi with its Airbus 330 planes.

"We're missing a big gap," Mr Fernandes said in Dubai. "The UAE is a very important part of the world now. We've got to be here."

AirAsia X briefly flew to Abu Dhabi in 2009, but pulled out early last year because of commercial difficulties with the route and the company opening its routes to India and China.

Mr Fernandes said his customers across Asia would welcome the opportunity to travel to the UAE. The flights would also provide another option for the large numbers of Filipinos, Thais and Indonesians who work in the country to travel home.

"People will say how are you going to take on Emirates and Etihad," he said. "We're not here to take them on. They've developed new markets all over the place, new traffic flows. We'll add people who never dreamed of coming to Dubai."

Mr Fernandes was also in the UAE to speak to institutional investors about planned public offerings of stock at Thai AirAsia and Indonesia AirAsia, two part-owned subsidiaries.

He expects to raise more than US$500 million (Dh1.83 billion) from the sale of stock, which would be used to help those centres expand in Asia.

"If you look at our earnings last year of about $400m, only $50m to $60m came from Thailand and Indonesia," said Mr Fernandes, who is also the head of the Lotus Formula One racing team. "They are much bigger markets than that. This will help them grow and become more profitable."

He said he was looking for other opportunities in the UAE related to his core budget and middle-class markets.

"I think there is a space here for budget hotels, even budget financial services," Mr Fernandes said.

"The UAE has done very well at the high end. There is still a lot of business to be done at my end of the spectrum, which I call serving the underserved. Economies need volume as well and a crossover to keep things turning."

Another project under way is a private jet-style service affordable to business-class travellers.

"We're trying to provide a first-class product with a business-class price," Mr Fernandes said. "Everyone loves the idea of a private jet but nobody likes to pay for it."

The next big focus is in the car industry. He bought Caterham Cars in the UK last month for about £20 million (Dh120.2m).

The plan now is to create a more affordable sports car to cater to the increasingly affluent populations in the Middle East and Asia.

"It's great walking around the airport and someone comes up to you and says 'I never thought I could fly,'" Mr Fernandes said of the budget offerings on Air Asia.

"We hope at Caterham we can give someone a nought-to-60 mile per hour experience in 2.9 seconds, which not many cars can do, for a price that won't bankrupt them.

"I don't think super sports cars need to be so expensive."