AirAsia reintroduces fuel surcharges

1 May 2011

AirAsia, the Malaysia-based low-cost carrier, has announced it will reintroduce surcharges for tickets booked on or after May 3, 2011, in light of the continuously rising global jet fuel prices fuelled the Middle East unrest among other external factors. 

The levy, reintroduced after a three-year hiatus, for domestic flights within Malaysia and regional flights in Southeast Asia start from US$3. For routes to China, India, Australia, Japan, the Middle East and Europe, a surcharge starting from US$16 will be applied.

The carrier had previously dropped fuel surcharges in 2008 and has resisted implementing them since then, up until now.

AirAsia adopts a low-cost business strategy with a healthy stream of ancillary revenue, aside from surcharge, which makes up a majority of the carrier’s profits. According to the Centre for Asia-Pacific Aviation, ancillary revenue represented 18 percent of AirAsia’s total revenues in the second quarter of 2010. The carrier charges for services, such as advanced seat selection and inflight meals.

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Alisha Haridasani

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