AirAsiaX/FAX's financial position-in Tony Fernandes & AirAsia's own words
Point 1 -FAX,which now plans to operate a long haul service, could not run a rural air service for want of funds
Financial considerations were the primary consideration of MAS in dealing with FAX, despite this being a national service operation. When FAX was not able to fully meet payments due to MAS as FAX had yet to receive sufficient funds from the Government, critical spares were held back by MAS. .....when FAX was not able to completely acquire MAS' inventory of spares for turbo-prop aircraft due to lack of available capital, MAS physically transferred the spares to Subang, Kuala Lumpur – further compounding the problem of access to spares."
Azran Osman-Rani
Chief Executive Officer
Fly Asian Xpress Sdn Bhd
From http://www.theedgedaily.com/cms/content.jsp?id=com.tms.cms.article.Article_cece9f2e-cb73c03a-9fdee000-3f717de2
Point 2-Apart from the funds that are said to have been provided by Richard Branson/Virgin and perhaps AirAsia at a later date, which may amount to perhaps USD 16 million in total, FAX/AirAsiaX has no money
Last Friday Tony Fernandes told THE STAR:
Apart from the 20% stake sale to Virgin, FAX would sell an additional 20% to AirAsia Bhd and that would mark the first round of fund-raising exercise, capitalising FAX at nearly US$40mil, FAX director Datuk Tony Fernandes told a press conference after FAX and Virgin signed the share sale agreement yesterday.
This statement should be read in light of the admissions stated in Point 1 by Azran Osman-Rani Chief Executive Officer FAX/AirAsiaX.
Yet,not 2 days later came the announcement from Fernandes that apart from the investment by Branson/Virgin, AirAsia will also be called upon to invest in AirAsiaX.
Point 4-Cost cutting brought upon by a lack of funds
Malaysia Airlines (MAS) is not willing to put the lives of passengers at risk and wants the 12 aircraft, under dispute in an audit report by Singapore’s Fokker Services Asia Pte Ltd, repaired before it can begin rural air service (RAS) operations(that had been relinquished by FAX).
MAS requested Fokker Services to conduct an audit, the findings of which are being disputed by FAX.
MAS, in its statement, reiterated that one aircraft had been cannibalised of both of its engines, both propellers and had 70 parts missing.
This has been vehemently disputed by FAX which, in a statement earlier, said that over the past 11 months of operations, FAX had to overhaul six F50 engines and four Twin Otters engines, four F50 propellers and three Twin Otters propellers, and two Twin Otters landing gear, among others.
FAX said it did not cannibalise aircraft parts but rather rotated parts from airplanes coming in for maintenance to service those coming out of maintenance.
ALSO SEE:
Fernandes, who has dreamed up all kinds of ways to save money, claims AirAsia is the world's lowest-cost airline. ...... His pilots are trained to land at a later point on the runway and at a slower speed to conserve fuel and reduce wear and tear on tires.
(http://www.time.com/time/magazine/article/0,9171,501040719-662824,00.html)
Then See:
AirAsia in a statement said due to heavy rain and bad weather, its aircraft bound for Kota Kinabalu from Kuala Lumpur skidded lightly off the runway after it touched down at Terminal Two of the Kota Kinabalu International Airport..... passengers and the two pilots suffered minor injuries.
All of the above raises the question of why AirAsia is allowed to fly in Malaysia-for that story see upcoming part 2.
Financial considerations were the primary consideration of MAS in dealing with FAX, despite this being a national service operation. When FAX was not able to fully meet payments due to MAS as FAX had yet to receive sufficient funds from the Government, critical spares were held back by MAS. .....when FAX was not able to completely acquire MAS' inventory of spares for turbo-prop aircraft due to lack of available capital, MAS physically transferred the spares to Subang, Kuala Lumpur – further compounding the problem of access to spares."
Azran Osman-Rani
Chief Executive Officer
Fly Asian Xpress Sdn Bhd
From http://www.theedgedaily.com/cms/content.jsp?id=com.tms.cms.article.Article_cece9f2e-cb73c03a-9fdee000-3f717de2
Point 2-Apart from the funds that are said to have been provided by Richard Branson/Virgin and perhaps AirAsia at a later date, which may amount to perhaps USD 16 million in total, FAX/AirAsiaX has no money
Last Friday Tony Fernandes told THE STAR:
Apart from the 20% stake sale to Virgin, FAX would sell an additional 20% to AirAsia Bhd and that would mark the first round of fund-raising exercise, capitalising FAX at nearly US$40mil, FAX director Datuk Tony Fernandes told a press conference after FAX and Virgin signed the share sale agreement yesterday.
This statement should be read in light of the admissions stated in Point 1 by Azran Osman-Rani Chief Executive Officer FAX/AirAsiaX.
Point 3-FAX/AirAsiaX cashlow forecasts are not reliable
On 8 August the Wall Street Journal reported:
Commenting on AirAsia's expansion plans, Mr. Fernandes said the airline wouldn't need to raise any capital for funding."We don't have the need to issue bonds or issue stock. Our expansion will be funded by a strong cash flow and long-term loans," he said.
Yet,not 2 days later came the announcement from Fernandes that apart from the investment by Branson/Virgin, AirAsia will also be called upon to invest in AirAsiaX.
Point 4-Cost cutting brought upon by a lack of funds
Malaysia Airlines (MAS) is not willing to put the lives of passengers at risk and wants the 12 aircraft, under dispute in an audit report by Singapore’s Fokker Services Asia Pte Ltd, repaired before it can begin rural air service (RAS) operations(that had been relinquished by FAX).
MAS requested Fokker Services to conduct an audit, the findings of which are being disputed by FAX.
MAS, in its statement, reiterated that one aircraft had been cannibalised of both of its engines, both propellers and had 70 parts missing.
This has been vehemently disputed by FAX which, in a statement earlier, said that over the past 11 months of operations, FAX had to overhaul six F50 engines and four Twin Otters engines, four F50 propellers and three Twin Otters propellers, and two Twin Otters landing gear, among others.
FAX said it did not cannibalise aircraft parts but rather rotated parts from airplanes coming in for maintenance to service those coming out of maintenance.
ALSO SEE:
Fernandes, who has dreamed up all kinds of ways to save money, claims AirAsia is the world's lowest-cost airline. ...... His pilots are trained to land at a later point on the runway and at a slower speed to conserve fuel and reduce wear and tear on tires.
(http://www.time.com/time/magazine/article/0,9171,501040719-662824,00.html)
Then See:
AirAsia in a statement said due to heavy rain and bad weather, its aircraft bound for Kota Kinabalu from Kuala Lumpur skidded lightly off the runway after it touched down at Terminal Two of the Kota Kinabalu International Airport..... passengers and the two pilots suffered minor injuries.
All of the above raises the question of why AirAsia is allowed to fly in Malaysia-for that story see upcoming part 2.
Your point being?
ReplyDeleteApart from the fact that you seem to have an obvious "hard on" for Tony Fernandes?
And are you implying that Richard Branson is a stupid git for investing in AirAsia X? At least, Branson is a billionaire and the driving force behind the Virgin Group, not a wet-behind-the ears business newbie!
But, obviously, such mundane matters don't bother you!