Wednesday, November 23, 2011

AirAsia, MAS close to sharing the spoils -24 November, 2011

AirAsia, MAS close to sharing the spoils

Malaysian Airlines and budget carrier AirAsia are expected to make an announcement on collaboration between the two airlines in the first week of December, according to Dow Jones Newswires.

“We are looking at tremendous cost savings,” said AirAsia boss, Tony Fernandes.

The deal in which a share swap would give AirAsia's parent a 20 percent stake in Malaysia's national airline has been under intense scrutiny within Malaysia.

The alliance is expected to eliminate head-to-head competition on some routes, allowing each carrier to focus on core markets. 

AirAsia this week revealed that net profit slumped by more than half in the third quarter as fuel prices surged. It also warned that the next four months would also be challenging. 

The AirAsia announcement follows a third straight quarterly loss for Malaysian Airlines, which also suffered as a result of higher fuel costs.
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