The group has successfully refunded some 1.5m claims since January 2020
By PRIYA VASU / Pic TMR
AIRASIA Group Bhd rose four sen to RM1.02, effectively once again exiting penny stock status. Investors responded positively to AirAsia group CEO Tan Sri Dr Tony Fernandes’ message to commit to settling 450,000 outstanding passenger refunds in a Facebook video uploaded to AirAsia’s official page yesterday.
Fernandes said the group has successfully refunded some 1.5 million claims since January 2020.
“AirAsia hasn’t flown for a year and we have not had any financial support of any kind, unlike a lot of government airlines. Since January, we have paid back 1.5 million in refunds,” he said, addressing the ticket refund update in a 3.08 minute video.
He thanked 2.9 million people that accepted to take a credit refund in the form of a credit shell.
“We have 450,000 people to pay back and we will payback. Every week we are still clearing with whatever little cash we have and we will get there,” he said in the video uploaded on his Facebook page.
Fernandes added that the airline has flown over 600 million passengers and created thousands of jobs before the Covid-19 pandemic disrupted its business operations.
“AirAsia was a fantastic airline before Covid-19. Covid-19 is not our fault, we are not bad people. It obviously has affected us badly like many other airlines,” he said.
The video garnered over 58,000 views, 293 shares, 572 reactions and over 300 mixed comments from passengers.
“Please process our refund ASAP and do not force us to accept credit points. That will be the right thing to do. It will gain more customer trust in the long haul,” said a customer.
While some customers appreciated his candour where he was open about the financial distress the low-cost airline is in.
A Facebook user commented: “I have to admit though, that I am able to travel around to see the world. Many thanks to AirAsia. Service can be improved but without low-cost airlines like AirAsia, travelling the world might seem almost impossible for commoners like us.”
Fernandes also added that the group had retrenched 10% of its workforce and many more were put on a reduced salary to ensure the survival of the airline.
He also said AirAsia X Bhd is in deep financial stress.
“AirAsia X is in deep financial difficulties because it has not been flying anywhere and it has to deal with very unfair competition over the many years,” said Fernandes.
AirAsia X, which is currently undergoing corporate restructuring, has also committed to settle long haul refunds, he said.
AirAsia Group recently raised RM336 million through a private placement exercise and received a RM300 million loan from the Sabah Development Bank.
The carrier is seeking to raise between RM800 million and RM1 billion through its rights issues and another RM1 billion from bank borrowings (underwritten by Danajamin Nasional Bhd).
Aviation analysts believe the equity fundraising will not be enough to address its current negative equity position of -RM1.2 billion.