Malaysia's AirAsia waives fuel surcharge for all flights

Kuala Lumpur, Nov 12 (IANS) In a first such move worldwide, Malaysia-based AirAsia and AirAsia X have decided not to charge passengers fuel surcharge for all their local and international flights.

The measure is to fight competition in the aviation sector, which had been under pressure in recent months because of higher fuel prices.

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With crude prices coming down, it is now possible to waive the fuel surcharge, AirAsia Bhd group chief executive officer Tony Fernandes told reporters.

He said with the move - effective midnight Tuesday - passengers need only pay the fare, airport tax and administrative fee.

AirAsia becomes the first airline in the world to do away with the fuel surcharge for all its flights.

Previously, passengers paid an average of $2.5 as fuel surcharge.

Fernandes, however, stressed that he could not guarantee that the airline would not re-impose the surcharge should world fuel prices skyrocket again.

'I would be crazy to say I'll never impose a fuel surcharge. But we will resist for as long as we can,' The Star newspaper Wednesday quoted him as saying.

The check-in baggage handling fee, however, would remain. 'We imposed that (in April) for three reasons - fuel prices, to limit luggage, and to be more environmentally friendly,' he said adding 'The lighter the plane, the less emissions there will be.'

Fernandes also announced that the airline, Malaysia's second largest, would be offering 500,000 free seats covering all its destinations.

The booking period is until Sunday, and the travel period is from June 22 to Oct 24 next year.

'There are two ways to deal with a slow economy. You've got to give more value, and you've got to stimulate people to travel. That's what we're doing now,' he said.

AirAsia has started operations to various Indian destinations this year, concentrating on Tamil Nadu to garner business from the two-million-plus Indian diaspora in Malaysia.

Fernades made the announcement in the presence of the country's Domestic Trade and Consumer Affairs Minister Shahrir Abdul Samad, who applauded AirAsia's move.

In an immediate reaction, Malaysia Airlines (MAS) senior general manager (sales) Bernard Francis said MAS had already reduced its fuel surcharge by 50-73 percent.

'Our sales surged by 400 percent. We are looking at reducing the surcharge further to give customers what they want - low fare plus five-star products and services,' he said in a statement.