Tony Fernandes is predicting a strong comeback for airlines by 2H 2021, on the back of higher vaccination rates and growing pent-up demand in Asia-Pacific.
The group CEO of AirAsia expressed his optimism for the recovery of the airline industry after receiving his first vaccination shot in Malaysia last week.
“Vaccines are working and you only need to look to countries with significant progress in Covid-19 vaccination, such as the US, the UK and Israel, where there is a clear correlation between significantly less daily cases and vaccination programmes being rolled out as fast as possible.”
He added: “Vaccines being rolled out and strong demand will fuel a V-shaped recovery in coming months. According to IATA, there will be a rapid recovery in domestic air travel set to be above 2019 by 2022, with Asia Pacific leading the way.”
Fernandes also sees Malaysia's new Covid wave as "short term pain for long term gain," and expects the situation in the country to improve as the country's vaccination rate increases.
AirAsia staff in key markets are either already vaccinated or are in the process of getting theirs as soon as possible, he added. "Importantly, in all of the major markets we operate in, vaccination rollouts are on-track to have the majority of the population vaccinated towards the end of the year.”
As well, Fernandes said that "travel bubbles will support a fast rebound in the travel industry as countries deliver high vaccination rates and gain control of the virus. Global infectious disease experts are even predicting coronavirus may be treated as a simple cold in the future.”
Tony also explained that AirAsia has used the downtime in flying as an opportunity to further reduce its cost structure and focus on strict cost containment including exiting loss-making ventures such as AirAsia Japan and reducing its investment in AirAsia India to focus on Southeast Asia, where its brand and foothold is strongest.
“As an airline, I’m confident AirAsia will recover faster than many of our competitors, as more than 50% of our business is domestic leisure, which is going to pick up before regional or business travel," he stated.
"Low-cost domestic short-haul will likely rebound by the third quarter of 2021, and international could reach pre-Covid-19 levels by end of 2022."