Sunday, January 28, 2007

Europeans puzzle at viability of AirAsia’s budget fare for long haul

FRANFFURT: Not that there have been no low-cost airlines in the past. America, Europe and Asia have had their share of budget airlines that have given the big, established ones a run for their money.

But the recent announcement by AirAsia Bhd, Malaysia’s leading low-cost carrier, to start a regular service between Asia and the United Kingdom from July will mean that it will be the first low-cost airline to serve a long-haul route.

The undertaking has also led to a vibrant debate in both Europe and America over the viability of such a service.

German experts say that the undertaking is inherent with high risks.

They admit, however, they are not surprised that the initiative comes from AirAsia, a market leader in Asia, because it is a highly profitable company commanding a profitability of nearly 15 percent on turnover.

Continue reading at: Europeans puzzle at viability of AirAsia’s budget fare for long haul

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