Fernandes, king of Southeast Asia budget aviation, zeroes in on digital services as next big act

Facing bribery claims in India, AirAsia founder Tony Fernandes was nevertheless at his relaxed best onstage at an innovation conference in Singapore. No mention was made of those claims, and the centre of discussion was AirAsia’s next big act.

The former Warner Music executive has built AirAsia into Southeast Asia’s biggest low-cost carrier in the space of only sixteen years. Starting with two leased planes, AirAsia now has a fleet of 230 aircraft and carried 89 million passengers in the past year. Now the Kuala Lumpur-based company wants to mine its 300 million-strong database of customers for gold.

“We’re in this fantastic revolution now,” Fernandes said to a packed hall at the Innovest Unbound conference on Tuesday morning. “Data is changing the world. Extracting new value from customers and providing them with services … I actually have loads and loads of customers.”

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AirAsia is looking at the “travel eco-system” and seeking ways to provide additional services to its customers, he said. “We see financial services as a huge opportunity. Our customers are paying high fees for remittances and foreign exchange.”

The airline is also looking at how to use the data to generate deals for customers and footfall for merchants, he said, citing the example of “tourists from Malaysia, Indonesia coming to Singapore to shop”. Fernandes also said he’s a “big believer in digital currencies”.

AirAsia is in the midst of turning its frequent-flyer rewards plan into a cryptocurrency-backed programme. Fernandes has been quoted as saying the company is considering an initial coin offering at some point. The company is also looking at funding promising start-ups to meet a gap where entrepreneurs find it difficult to get capital, he said on Tuesday.

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Fernandes is currently the subject of an investigation in India over his role in getting government officials to change rules to get overseas flying rights, according to The Economic Times. Shares of the Kuala Lumpur-traded company also fell after he apologised for endorsing former prime minister Najib Razak in Malaysia’s recent general election.

Fernandes built AirAsia into Southeast Asia’s biggest low-cost carrier partly by challenging established norms and reluctant governments in the region. Along the way, he dabbled in Formula One (which he has called a “huge mistake”) and bought a majority stake in English football club Queen’s Park Rangers.

Newly-married, Fernandes was asked why he struck out to create AirAsia. In a familiar answer that he has used over the years, he said he was not deterred by what governments or analysts said but was fixated on “6 per cent”, which used to be the proportion of Malaysians who had flown on an airline.

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With e-commerce and other digital services in Southeast Asia taking off but still at a relatively slow pace, Fernandes said that the region should “get together so that we don’t get marginalised by China or India”.