The charismatic, eternally optimistic leader of AirAsia has been in the spotlight in recent months for far more tragic reasons than he is generally accustomed to. Malaysian-born Tony Fernandes has handled the aftermath of the AirAsia flight QZ8501 crash of December 2014 with considerable compassion, demonstrating a serious determination to uncover what caused the disaster. Using Twitter, Fernandes described the crash as his “worst nightmare”. He has engaged with the families of the victims, and has continually attempted to keep the world up to date with his company’s efforts to recover the bodies of those lost in the disaster.
After the crash, he rushed to the Indonesian city of Surabaya – where the flight had departed from – and set about coordinating the recovery efforts while also attempting to comfort the families of those on board the plane. Such actions are rare in many industries, but Fernandes has taken full responsibility for leading the effort to help those affected by the tragedy.
Aside from AirAsia, Fernandes has pumped money into a range of different business ventures
Breaking through
Such an involved approach is what Fernandes has become known for during his entrepreneurial career. He came to prominence at the turn of the century, after his acquisition of the heavily indebted Malaysian state-owned airline AirAsia. The deal was struck in October 2001; just weeks after the September 11 attacks in New York severely damaged the value of airlines, as well as the reputation of the industry as a whole. As a result, Fernandes secured the company at a sizeable discount.
His strategy was to offer a budget travel service to the Asian market, much like the ones that had become increasingly popular across Europe in the preceding years. Such was his determination that he mortgaged his home and used his own savings to buy the ailing airline, taking on $11m worth of debts in doing so. However, within one year he had transformed the firm – it broke even, and even paid off all its arrears.
In November 2004, Fernandes took the company public, leading to the initial public offering being 130 percent oversubscribed. His strategy in reversing the fortunes of this struggling airline lay in opening up the Asian market, creating new connections between destinations at a far cheaper price than people had been used to. According to Fernandes, around half the airline’s passengers are first time flyers, emphasising just how successful AirAsia has been in transforming air travel in the region. Although it has led to a number of rival budget airlines emerging across Asia, Fernandes’ firm remains the largest, flying to 65 destinations across 18 countries, primarily across the Association of Southeast Asian Nations (ASEAN).
Speaking to management consultants McKinsey last year, Fernandes reflected on the changes that have occurred within his industry over the last 14 years: “I went out there and built an ASEAN airline by putting airlines in four countries. I found ways of doing it. I didn’t wait for the ASEAN community. And we’ve connected ASEAN. 60 percent of our destinations are destinations that were never done before within ASEAN – we built an ASEAN tourism market.”
He added that the close economic ties between ASEAN countries means there will always be opportunities for his airline. “For AirAsia, I’m hoping that an economic community will help reduce costs by having common standards: one air traffic control system, one engineering system, one [set of] standards. And obviously open skies — true open skies — and common ownership. As an ASEAN company, why can’t I own 100 percent of a Filipino airline? And why can’t a Filipino own 100 percent of a Malaysian carrier? That, I think, is what I’ll be pushing for.”
Humble beginnings
Born in Kuala Lumpur in 1964, Fernandes studied in London at Epsom School before furthering his education at the London School of Economics. Now aged 51, he has amassed a personal fortune of roughly £400m. His career, however, began under the tutelage of one of the world’s most high-profile and charismatic entrepreneurs.
Before embarking on his shake-up of the airline industry, Fernandes worked in the record industry. While living in London in the late 1980s, he worked under Richard Branson for two years as the financial controller of Virgin Records. Branson’s entrepreneurial and charismatic spirit seems to have had a great impact on Fernandes, who has since tried to emulate his former employer’s habit of entering into many different markets.
Aside from AirAsia, Fernandes has pumped money into a range of different business ventures: in 2007, he launched the Tune Hotels budget hotel chain, which holds properties throughout the Far East, Australia and the UK, and in 2010 he founded the Caterham F1 racing team, which also acted as a re-launch of his original Lotus Racing team. He eventually sold the team last July, but not before raising his profile considerably off the back of the world’s most glamorous sport.
Fernandes’ love of sport has also been seen through his affiliation with English football. For many years he professed a devotion to West Ham Football Club, claiming that he wanted to acquire the club from its current owners. However, after he was rebuffed in early 2011, Fernandes turned his attention across London to the newly promoted Queens Park Rangers (QPR), and promptly became the club’s majority shareholder. Due to the unpredictable nature of this high-profile game, his leadership of QPR over the last four years has been tumultuous – although most fans seem to have bought into Fernandes’ seeming passion and commitment to the success of the club.
The public eye
Budget airlines tend to rely on the charisma of their owners, along with various publicity stunts, to propel their success. While Ryanair boss Michael O’Leary has become renowned for his outlandish claims about what traditionally basic services he plans to charge passengers for next, Fernandes has cultivated a far friendlier and more personable image. He frequently engages with passengers on Twitter, as well as often communicating with QPR supporters about the fortunes of the club – although this might be a decision that he sometimes regrets.
His acquisition of multiple sports teams has often been seen as a nothing more than a trick designed to raise his global profile – though he genuinely seems to have a passion for both Formula 1 and football. Nonetheless, Fernandes has not been averse to the occasional publicity stunt: in 2013 he even had a bet with his former mentor Branson over a Formula 1 race, which resulted in the British entrepreneur having to dress an as an air stewardess and serve passengers on an AirAsia flight.
Dreaming big
Such is his fame and success in Asia that Fernandes was appointed figurehead of the continent’s version of The Apprentice in 2013. By offering businessmen and women the chance to work alongside Fernandes within his growing business empire, the show has been received by a huge amount of enthusiasm from across Asia.
Fernandes’ ambitions for his empire are typically grand – he has even said that he hopes AirAsia will one day become “as well-known as Coca-Cola”. And while this might seem like a fanciful target, the rapid increase in air travel across Asia and the determination that Fernandes shows means it might not be beyond the realms of possibility.
2015 started off in the worst possible way for AirAsia, but Fernandes’ handling of the tragedy has been widely praised. His attitude is one of a more compassionate and engaged company chief, and it is perhaps an example that many others might choose to follow in the future.
