BEIJING – AirAsia Bhd has signed a memorandum of understanding (MoU) with China Everbright Group and Henan Government Working Group to establish a low-cost carrier (LCC) in China.
It outlines how the parties will incorporate a joint-venture to be known as AirAsia (China) for the purposes of operating a low-cost aviation business based in Zhengzhou, the capital of Henan province in central China.
In addition, AirAsia (China) will invest in aviation infrastructure, including a dedicated LCC terminal at Zhengzhou airport and an aviation academy to train pilots, crew and engineers, as well as maintenance, repair and overhaul (MRO) facilities to service aircraft.
The MoU was exchanged between AirAsia Group Chief Executive Officer, Tan Sri Tony Fernandes, Everbright Financial Investment Holding Executive Director and President, Wang Weifeng and Henan Airport Group General Manager, Li Weidong at China World Hotel here on Sunday.
The ceremony was witnessed by Prime Minister Datuk Seri Najib Abdul Razak who is on a five-day working visit to China.
Also present were AirAsia Executive Chairman Datuk Kamarudin Meranun, AirAsia Senior Independent Non-Executive Director Fam Lee Ee and AirAsia North Asia President Kathleen Tan.
China Everbright Group Vice Chairman and President Gao Yunlong said: “We are excited to be part of this joint-venture to bring AirAsia to China. We believe China is ready for a true LCC and we feel that only AirAsia can deliver on that promise by providing real value to Chinese travellers, thanks to its unique combination of low fares and award-winning service.”
Henan Provincial People’s Government Deputy Governor Shu Qing said, “Henan is very pleased to offer AirAsia a home in China. Zhengzhou was once the capital of ancient China. With AirAsia supporting the city’s aeropolis – an industrial, commercial and logistics zone five times the size of Manhattan with the airport at its heart – we have absolute confidence that we will succeed in transforming Zhengzhou into the new capital for regional and global transport and logistics.”
Commenting on the agreement, Fernandes said Zhengzhou was chosen as a base due to its strategic location and importance as a logistics hub.
“As China’s gateway to Europe, Zhengzhou sits at the centre of a vast rail, highway and air transport network that forms the lynchpin of China’s development plans for its central and western regions.
“This Chinese venture represents the final piece of the AirAsia puzzle. In just 16 years, we have successfully built a presence in Malaysia, Thailand, Indonesia, the Philippines, India and Japan, with China closing the loop on all major territories in Asia Pacific,” he said.
While Kamarudin regarded today’s MoU as the latest in a long line of strategic collaborations with Chinese companies, from Tencent, Alipay and Union Pay for payments to Industrial and Commercial Bank of China for aircraft financing and China Aircraft Leasing Group Holdings Ltd for aircraft leasing.
“In addition, we are working closely with Huawei to create a digital airline and smart airport to transform the way we fly.”
AirAsia was the first foreign LCC to enter China and has carried more than 40 million guests since its inaugural route to China in April 2005. AirAsia and AirAsia X currently fly to 15 destinations in China and is the largest foreign LCC operating into the country.