AIRASIA X Bhd, the long haul budget airline-cum-sister company of AirAsia Group Bhd, is surely going to enrage tens of thousands of passengers who have waited close to 18 months for a refund since the imposition of the maiden movement control order (MCO 1.0) on March 18, 2020.
This follows news that passengers who have credits with the budget airline are likely to get back only 0.5% of the amount owed to them under the carrier’s proposed debt restructuring exercise which will be put to vote on Nov 12.
According to AirAsia X, the exercise – if approved – will be a full and final settlement and the company will not be liable to any legal action from any creditor after that.
“However, it warned that AirAsia X is expected to go into liquidation if it fails to get the nod,” noted the Free Malaysia Today portal which sighted the explanatory statement.
To illustrate how much passengers can expect to get, the airline said anyone who is owed RM2,000 will get RM10 as “profit-sharing” on the anniversary of the approval of this exercise, adding that they will get similar returns for four years after that based on a specified formula outlined.
In the details of the creditors contained in the statement, AirAsia X owes about RM600 mil to passengers and travel agents, thus it will have to pay RM2.9 mil as settlement if approved.
Promises meant to be broken?
In late March, AirAsia Group CEO Tan Sri Tony Fernandes has said in a video posted on the social media that AirAsia had around 450,000 customers who had yet to be refunded.
The airline tycoon said the company would try to gradually pay the customers off in the form of credit shells. He also thanked 2.9 million of their customers who opted for the credit shell refund scheme in the video.
Since January of this year, he said the AirAsia group have given out 1.5 million refunds. Credit shells is a form of credit which passengers can use to make another booking in the future. Due to the viral outbreak of COVID-19, that credit is valid for up to two years.
“This will cause a riot … Some lawyers should take up the case to fight for the passengers’ refund,” an AirAsia frequent flyer told FocusM on condition of anonymity “Or collectively, file reports in the small claims court.”
Another affected passenger said AirAsia X should convert the money owed to credit shell for future flights if a refund is impossible due to the airline’s ailing financial situation.
“Now everyone might have a phobia of buying advance tickets from AirAsia X or even AirAsia as the same thing can happen should another lockdown or slowdown in aviation happens,” he lamented.
“He (Fernandes) should sell his personal assets – Tesla car if he owns any, football club and international school or any other assets – to save the company. In most countries, the owner will be declared a bankrupt with his company.”
At 3.02pm, AirAsia X was down 0.5 sen or 5.26% to 9 sen with 3.6 million shares traded, thus valuing the company at RM373 mil while AirAsia Group was down 1 sen or 0.88% to RM1.12 with 11.22 million shares traded, thus valuing the company at RM4.37 bil. – Oct 21, 2021
