Daily Express Subscriber
Sign in to your account.

Kuala Lumpur: AirAsia has signed an agreement to buy US$12.25 billion (RM51.72 billion) worth of long-range Airbus 321XLR aircraft, with deliveries confirmed by 2028, said Capital A Bhd Chief Executive Officer Tan Sri Tony Fernandes.

He said the low-cost carrier inked a memorandum of understanding (MoU) with Airbus in Paris Saturday for 50 A321XLRs with rights for 20 A321XLRs, the new fleet of which are targeted to serve Central Asia, the Middle East and Europe, among others.

“This will probably make us one of the largest users of the XLR aircraft, the 321XLR, and is really the next stage of our transformative growth in terms of creating the world’s first low-cost multihub network carrier.

“This will enable us to fly to Europe, and we’re hoping to launch our first European flight this year,” he said during Capital A’s virtual media briefing on Friday, in conjunction with the agreement signing ceremony.

The agreement was signed between Fernandes and Airbus Commercial Aircraft Chief Executive Officer Christian Scherer, witnessed by Prime Minister Datuk Seri Anwar Ibrahim.

Fernandes said the next-generation A321XLRs will operate alongside AirAsia’s all-Airbus fleet of A320 Family and A330 aircraft, and aims to carry 150 million guests annually by 2030, reaching a cumulative total of 1.5 billion guests since inception.

He said AirAsia plans to finance the aircraft order through bank leases.

Fernandes also confirmed that the group is set to announce another aircraft order next month, but declined to provide further details.

Meanwhile, he said the group is working to issue its first bond by October this year.

“This is the first time in our history that we’ve been rated by international credit rating agencies,” he noted.

“As interest rates begin to moderate, which I’m hopeful will happen soon, it’s only natural for us to return to our traditional model of owning aircraft. 

“Previously, we shifted from the financing markets to operating leases due to high interest rates and strong capital availability in the leasing space. We’re now reassessing that strategy,” he said.

On Capital A’s proposed regularisation and restructuring plan, Fernandes said the company is expecting to resubmit the decision letter to Thailand’s Securities and Exchange Commission within the next week or two.

“Once we dispose of the aviation business, Capital A will effectively exit Practice Note 17 (PN17),” he said.

He added that six of the group’s non-airline businesses, namely Asia Digital Engineering (ADE), Teleport, AirAsia MOVE, OTA, BigPay, Santan, and AirAsia Brand Co (ABC) are currently exploring the possibility of a dual listing in Hong Kong.

As for Capital A, it is also considering a dual listing and independent capital raising. However, Fernandes said “the AirAsia Group itself will not be listed in Malaysia”.