Fernandes and Kamarudin to Spend More Time on AirAsia

26th Jun 2015

Chief executive officer of AirAsia Tony Fernandes said he will focus more on leading the company and put other businesses aside in an effort to repair the damage done to the carrier after a negative report by GMT saw its shares plummeting.

According to analysts close to the Malaysian budget airline, both Fernandes and his partner, AirAsia X Chief Executive Officer Kamarudin Meranun, will become more involved in day to day operations within the company.

One executive, who requested his name to remain undisclosed, said:

He’s back (Fernandes), and he’s getting more involved in many of the decisions.

An analyst for Maybank Investment Bank based in Kuala Lumpur, Mohsin Aziz said:

Tony told us in a conference call last week that he and Kamarudin will take a back seat to everything else and focus on AirAsia.

AirAsia Senior Staff Worried Fernandes Spends Too Much Time on Other Businesses

Some senior AirAsia staff were apparently growing concerned that Fernandes is spending too much time away and is devoting more of his time to other ventures.

Besides being a CEO and president of AirAsia, Fernandes also owns English Championship League club Queens Park Rangers, a hotel chain and an insurance business. Until last year, he also owned Catherham F1 team.

According to some AirAsia executives, Fernandes delegated most of the decision-making to heads of individual airlines and frequented the office less often.

GMT Report Makes Everyone at AirAsia Worried

Concern over Fernandes’ frequent absences were increased following a report by GMT Research, which stated that AirAsia increases its revenue using related-party transactions with loss-making affiliate airlines.

Since that report was published, the carrier’s shares went down 24 per cent.

The report also made some investors worried that AirAsia is becoming too dependent on associated carriers operating in India, Indonesia, the Philippines and Thailand. These all fly under AirAsia brand and lease their jets from it.

Fernandes said last week at the Paris Airshow the company has a good balance sheet and business plan. He also said he believes AirAsia Indonesia to break even and AirAsia Philippines to return to profitability by the end of 2015.