Is AirAsia slowly but surely flexing its aviation muscle once again?

Is AirAsia slowly but surely flexing its aviation muscle once again?

WHETHER it is a coincidence or otherwise, AirAsia Group Bhd has been issuing media releases that is relevant to the aviation sector for two days in a row now.

This is very encouraging after the budget carrier found itself drifting further and further way from its core business of flying by embarking on numerous digitalised business endeavours that range from paddling beauty items to financial products to delivery of the harumanis mango species.

Yesterday, its group CEO Tan Sri Tony Fernandes – having taken his first COVID-19 jab – came out in the open to reaffirm his confidence of a strong comeback for AirAsia and for airlines the world over this year on the back of robust pent up demand for travel.

While acknowledging that the AirAsia management has taken pain to build up momentum on its super-App segment, Hong Leong Investment Bank (HLIB) Research he research house does not expect material contribution from the super-App in the near term given it is “unable to cover the expected huge losses from the airline segment”.

This has led to research houses deriving at ‘ridiculous’ target price for the budget airline – from CGS-CIMB Research (5 sen on March 30) and MIDF Research (21 sen on April 28) to HLIB Research (70 sen on May 4).

Therefore, today’s revelation that Asia Digital Engineering Sdn Bhd (ADE), a wholly-owned subsidiary of AirAsia, is well on its way of becoming Asia’s leading provider of aviation engineering services is quite admirable.

This comes after ADE obtained base maintenance approval from the Civil Aviation Authority of Malaysia (CAAM).

With the approval, ADE is able not only to perform regular line maintenance, but also base maintenance (hangar or C-checks) for the AirAsia Group’s airlines as well as to support third party airlines for aircraft maintenance repairs and overhaul (MRO).

“We always believe Malaysia should be the strategic hub for aircraft maintenance in the region and beyond, creating jobs and economic benefits for the future and we thank CAAM for assisting to make this a reality,” commented CEO of ADE Mahesh Kumar.

“Based on demand, we are looking to expand our aircraft maintenance facilities and services in KLIA, Johor and other airports in Malaysia by either utilising existing hangars or building new hangars.”

With this base maintenance approval from CAAM, ADE is now poised to become not just the biggest MRO in Malaysia, but also one of the biggest in Asean and beyond. – May 12, 2021