AirAsia Ready to Take on India Challenge: CEO
Asia's largest low-cost carrier by passenger numbers, AirAsia, said it was "confident" about entering the Indian aviation space - a market that has been challenged by intense price competition and exorbitant operating costs.
"We've taken a lot of time to study this market, and we feel that we can now have a really low cost product, which many of the other airlines struggled to do earlier. And that's giving us confidence," Tony Fernandes, CEO of Malaysia-based AirAsia told CNBC on Wednesday.
"When we started in Malaysia - Malaysian airlines had consistently lost in domestic business, it doesn't mean what happened in the past can't be turned around," he added.
The airline industry in India is reeling under losses and mounting debt, which prompted the government last September to open the sector to investment from foreign airlines.
AirAsia last week announced plans to launch an Indian budget airline with domestic conglomerate Tata Group. The companies are currently seeking approval for the joint venture from the country's Foreign Investment Promotion Board.
AirAsia on Tuesday reported a 238 percent surge in profit to 1.88 billion ringgit ($606.65 million) for 2012, helped by growth in passenger numbers and the share sale of its Thai business.
Jewel in the Crown
"The turnaround for our Thailand and Indonesia affiliates have really started to come good - added with the superb performance of the Malaysian business really gave us a good year and a great [fourth] quarter," Fernandes noted.
He said the market he's most bullish on for the longer-term is Indonesia.
"It's our jewel in the crown; we continue to make market share gains. We're very bullish on Indonesia, huge market, huge opportunity, both inbound and outbound tourism, plus the domestic market," he said.
Discussing the carrier's operations in Japan and Philippines, he said that he has seen a pickup in volume in the two markets, noting that they are "almost cash positive."
(Read More: Indonesia's Boom Becomes a Bane for Some Airlines)
"It took us two years to get Indonesia and Thailand into a breakeven position, but we see it much quicker in both Japan and Philippines now. It's a normal course of business," he added.