AirAsia co-founder rejects collapse rumours as carrier posts quarterly loss

Tony Fernandes went after what he called "ludicrous" rumours that AirAsia was close to collapse. Speaking at a press conference on 18 September, the co-founder said the carrier remained viable despite recent financial losses. The briefing ran more than two hours.

Fernandes said the current fuel crisis is not the hardest period in the group's history. Covid-19 was worse, he argued, because aircraft could not fly at all. Forward bookings, he said, showed underlying demand.

Hours after the conference, AirAsia received an industry award as the world's best low-cost airline, the 17th consecutive year it has taken the title. The timing came amid a run of reports questioning the group's future.

The briefing followed a Reuters report that the Malaysian government had asked other operators to take on AirAsia's domestic market share as a contingency measure while it monitors the carrier's financial health.

AirAsia Group recorded a loss after tax of MYR831 million ($204 million) for the April-to-June quarter, against a pro-forma profit after tax of MYR919 million a year earlier. Fuel expenses for the quarter rose 58%, a sharper increase than the reductions recorded in maintenance and user charges.

After fuel prices climbed, the group cut as much as 25% of capacity through September as part of a wider network restructuring. It is also seeking more than $1 billion in financing for debt restructuring and to consolidate its balance sheet.