Annual Report 2019

AirAsia India AirAsia India’s domestic network has been growing stronger, aided in part by the collapse of Jet Airways. The resulting increase in airport slots availability enabled our associate to expand into key metro cities which were previously difficult to get into. In 2019, AirAsia India welcomed nine additional aircraft to support growth. Meanwhile, the team continues to work to obtain its international license. AirAsia Japan AirAsia Japan posted commendable growth in capacity and number of guests carried with the launch of its first international route to Taipei in February 2019, followed by its second domestic route, Nagoya—Sendai, in the third quarter. As it gains traction in the region, we look forward to seeing enhanced connectivity in 2020. AirAsia Japan’s move into the new LCC terminal in Chubu Centrair International Airport is another plus point, lending greater efficiencies to support a more robust cost structure. Airline Ancillary Using data from our guests, we have personalised our ancillary offerings, thus increasing their uptake. This saw our Airline Ancillary revenue grow by 13% to RM2.1 billion. The take-up of Baggage and Pick-a-Seat, the two biggest ancillary revenue contributors, increased by 17% and 24% respectively driven by targeted pricing and machine learning-based prediction; with Baggage contributing RM1.2 billion and Pick-a-Seat RM204 million. A key highlight was the launch of high speed internet on AirAsia WiFi using Ka-band technology starting August 2019. This allows guests to stream live on social media or watch their favourite shows at 30,000ft above ground. Previously known as ROKKI and was available on our Malaysian, Indonesian and Philippine flights, in 2019 the service was expanded to AirAsia Thailand and AirAsia X. We also continued to expand and enhance our inflight menu through Santan and T&Co. For the first time, we engaged celebrity chefs to develop signature dishes for our flights. We also made available destination-specific meals catering to local tastes, and designed hard-to-resist combos that offer real value for money. Meanwhile, T&Co, our drinks and snacks brand, introduced a number of tantalising offerings including burnt cheesecake while adding to its drinks selection with the Malaysian classic, teh tarik (pulled tea), as well as a specially concocted ASEAN Blend Drip Bag, using the best coffee beans hand-picked from the region. Regional Expansion Although in last year’s annual report we had mentioned expanding to Vietnam, plans towards this end have been put on hold until a suitable partner is found. Meanwhile, we are still very interested in establishing a presence in Indochina, the fastest-growing region within ASEAN, and are looking at possible partnerships in Cambodia as well as Myanmar. If the conditions are right, we would also gladly set up a new base in China. One AirAsia Just as each individual AOC is growing, we are making steady progress in terms of integrating all of them under One AirAsia. This year, we set up AirAsia SEA to manage shared services such as Finance, Legal, Procurement and People & Culture across the airlines. This will ensure consistency in processes and systems while enabling us to leverage economies of scale. Supporting the Finance function, we are rolling out Oracle’s market-leading Enterprise Resource Planning (ERP) Cloud to reconcile cross-currency data and transact with suppliers in different countries, simplifying, standardising and automating our financial operations Group-wide. AIRASIA GROUP BERHAD ANNUAL REPORT 2019 85 PERSPECTIVE