AirAsia Denies Need for Rescue, Targets $1 Billion Refinance as Fuel Costs Jump 58%
Updated
Updated · CNBC · Sep 18
AirAsia Denies Need for Rescue, Targets $1 Billion Refinance as Fuel Costs Jump 58%
3 articles · Updated · CNBC · Sep 18
Summary
Tony Fernandes said AirAsia is "sustainable" and needs no government rescue, pushing back after reports that Malaysian authorities were assessing whether rivals could absorb its domestic market share.
Fuel expenses rose 58% from a year earlier as jet fuel averaged $183 a barrel, but Fernandes said the airline has reworked its cost and revenue structure to cope with the surge.
The carrier's fundraising is aimed at refinancing rather than plugging operational shortfalls, with plans for up to $1 billion in international debt and 700 million ringgit in local credit facilities.
Fernandes said AirAsia will unveil a growth and strategy update with Airbus within a month, while AI tools are already delivering about 3% fuel savings and new customer features are due within three months.
After cutting capacity 11% in the quarter and trimming weaker routes and fleets in the Philippines and Indonesia, AirAsia expects to restore capacity to pre-war levels in the fourth quarter.