Thursday, July 14, 2016

Air Asia Orders 100 Airbus A321neo Aircraft

AirAsia and Airbus have announced a firm order for 100 Airbus A321neo aircraft at the 2016 Farnborough Airshow. The move represents a shift away from AirAsia's exclusive fleet of Airbus A320 aircraft as the carrier attempts to meet growing demand at congested airports in Asia.

airasia a321
Image Source: Airbus
AirAsia is currently the largest operator of Airbus single aisle aircraft. With the announcement of an additional 100 aircraft, AirAsia has ordered a total of 575 A320 family aircraft from Airbus. Currently, Airbus has delivered more than 170 A320 aircraft to the AirAsia family including its affiliates in Malaysia, India, Indonesia, Japan, and the Philippines. However, this is the first order for the 240-seat Airbus A321 aircraft placed by the Asian budget carrier, recently voted World's Best Low-Cost Airline for the eighth consecutive year.

AirAsia plans to use the aircraft to increase capacity, while enjoying the lowest operating costs in the single aisle aircraft category by leveraging the increased efficiency and higher capacity of the A321neo on high-density routes. Currently, AirAsia's A320 fleet seats 180 passengers. The new version of the A321neo has the ability to seat up to 240 passengers, which will provide AirAsia with 33% more capacity that will enable the carrier to optimise service on high-density routes.

According to AirAsia Group CEO Tony Fernandes, the carrier  recorded a robust load factor in the first quarter of 2016 and it is believed that the positive momentum will continue well into the future. "AirAsia Group currently operates close to 1,000 flights per day to more than 120 destinations in 24 countries. The A321neo will help us to meet ongoing strong demand as well as further reduce our cost per Available Seat Kilometre across the group, which will translate to lower air fares for our guests," said Fernandes. 

Congestion at airports in Southeast Asia remains a major problem for carriers that are trying to meet growing demand. This is especially evident at Ninoy Aquino International Airport in Manila, where slots are at a premium due to their limited availability. This has triggered both Philippine Airlines and Cebu Pacific, the nation's largest low-cost carrier, to also place orders for the larger A321 aircraft. 

Meanwhile, AirAsia Philippines faces a similar problem in that the only way it can expand capacity in Manila is to increase the size of aircraft it utilises on existing flights, as increasing the number of flights out of Manila is not possible at this time. That makes it highly likely that some of the new A321 aircraft ordered by AirAsia will be headed for the carrier's Philippine unit.

"The A321neo will be operated on our most popular routes and especially at airports with infrastructure constraints. It will allow us to bring higher passenger volumes with the same slots, therefore providing immediate benefits to the airports. These include, among others, more efficient operations, higher revenues from passenger service charges, and more airport retail purchases. We will also continue to maintain our 25-minute turnaround with two or three-step boarding where permitted to ensure on-time performance," added Fernandes.

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