Air Asia combines with Malaysia Airlines

Malaysia Airlines (MAS), the national airline, and budget carrier Air Asia, together with long haul, sister operator AirAsia X, have entered into a comprehensive collaboration framework that will see the airlines exploring opportunities to co-operate on a broad range of areas.  

AirAsia shareholders will hold 20.5% of Malaysia Airlines and in the other direction the interest will be 10%.

Many see the MAS-AirAsia partnership as a way to help stop MAS from plunging further into the red, while others feel AirAsia will benefit as much as the national carrier from the alliance.  Whether Tony Fernandes, the British-educated Malaysian entrepreneur behind the partnership, can make it work remains to be seen.  His foray into Formula One with Team Lotus has not as yet seen the cars anywhere near the front of the grid even with another venture, Caterham, blazoned on the cars.

Under the arrangement, rationalisation is expected especially in the domestic market.  The airlines’ networks overlap directly on 38 routes, while there are some indirect synergies in some markets.  These include London, where Malaysia Airlines serves Heathrow and Air Asia X flies to Stansted (Gatwick from the end of October) and Paris with Malaysia Airlines to CDG and Air Asia X Orly. www.malaysiaairlines.com www.airasia.com

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