An AirAsia X reset is in the works following the near unanimous agreement of creditors with the Scheme of Arrangement (SOA) at meetings held on 12th November 2021. In business terms, this means the agreement will be presented for court sanction in coming weeks. Once approved, the airline will embark on its recapitalisation which was approved by its shareholders in June 2021. Completion is expected in the first quarter of 2022 after which the airline will be well positioned to compete effectively in the markets where it will operate.
AirAsia X reset, what it means
In a statement issued today, the airline thanked its creditors for their strong support for its future during very difficult times. When the scheme was initially announced in October 2021, it was comprehensively rejected and widely derided as being wholly inadequate and unreasonable. However, following multiple discussions on the business plan and alignment of common business interests, all major creditors have agreed that the interests of all are best served by allowing the airline to proceed with the scheme as proposed.
AAX is currently utilising four of its wide body A330’s for regional cargo flights with a further two to be operational by year end. We’ve been following these flights and note that they are across a variety of destinations in the AAX network, from the sub-continent to China and down to Australia. These flights are operating dedicated belly cargo services for several of the largest global freight companies. AAX is also holding ongoing discussions for belly cargo agreements on passenger / cargo combination flights when borders reopen.
For passengers and staff
With six of their aircraft flying regularly by year end, you can be assured that crews are keeping their skills up to speed. In thanking staff, AAX Chairman Rafidah Aziz said their sacrifices of the past 21 months had been a critical component of the cost containment exercise.
…. We would like to thank all our furloughed pilots, crew and support staff and assure them that all of them will be further brought back to full employment in the coming months as borders open up.
The AirAsia X reset is also important to passengers, the mainstay of any airline. According to an earlier report, it was indicated that the airline proposed to treat air travel consumers as creditors and to pay only 0.5 per cent of the value of tickets purchased. The Malaysian Aviation Commission (Mavcom) has urged AirAsia X Bhd to reassess this proposal. It would be sensible, therefore, for AAX to offer full credit to those who have purchased tickets, generating confidence and ‘getting bums on seats’ as soon as possible after flights resume.
In its statement, AAX reiterated that business partners and supporters, particularly passengers, are vital and important to AAX and values this relationship.
…. We wish to assure all passengers affected by the restructuring that it is the firm intention of AAX to put in place travelling privileges in the form of travel credits, which can be utilised for future purchases of flight tickets once international borders reopen. Tony Fernandes, Co-founder and Director of AAX