Tony Fernandes brought no-frills flying to Asia, and his life ambition is to buy Singapore Airlines

A PORTLY, FORTY-SOMETHING has been swallowed by a swarm of delegates at a conference in Kuala Lumpur. Camera phones are angling into his face, business cards are being stuffed into his pockets and all manner of things thrust at him to sign.

Swap the suit with spandex and the cards with underwear, and this man could be a rock star under siege by frenzied fans.

Which isn’t too far wrong.

Tony Fernandes, a former Warner Music executive, is to Malaysians what Lakshmi Mittal is to Indians. He is not nearly as rich (with a mere US$230 million to his name), but the part-Goan, part-Malaccan-Portuguese entrepreneur has won the admiration of his countrymen to a degree that Richard Branson – a man Fernandes is compared to with wearisome regularity – could probably live without.

Over the past seven years, Fernandes has turned a small, loss-making airline into the region’s first and largest no-frills carrier, AirAsia, and smashed the monopoly of bitter rival Malaysian Airlines. Some say that no one has captured the imagination of Malaysians like Fernandes since the days of their inimitable former prime minister, Mahathir Mohamad.

“The hanky panky of Malaysian politics and the demise of domestic companies like Proton has left a dearth of role models in this country,” says one prominent Malaysian blogger. “Tony has helped fill that vacuum.”

Fernandes, 44, is the first to admit that he has, like Branson, cultivated his own personal image as a way of pushing his company into the limelight. “I’m a media slut,” he tells me, with some pride.

The debt-ridden company he bought for a token one ringgit shortly after 9/11 now flies to 58 destinations including London on its long haul service, AirAsia X. Fernandes has a no-frills hotel chain – also Asia’s first – called Tune Hotels, and a frills-free online financial service modeled on Branson’s Virgin Money.

Another addition to the Fernandes frills-free family will be AirAsia’s own airport that he hopes to be open by 2011 at a cost of US$460 million. Neither the current budget terminal in KL, or the main airport, are big enough to satisfy AirAsia’s growth ambitions, Fernandes says.

It’s a miserable time for the airline industry. How are you coping?
Very well, thank you. We will benefit from this downturn as people will be looking to economize. Sales have doubled since we removed the fuel surcharge. We’ll probably have had the best quarter in our history come the end of the year. Next year, we will be adding more routes and doubling our advertising spending. We responded in a similar way during SARS. We tripled our ad spending and lowered our fares. It worked. Proof, if ever it was needed, that Malaysians will risk their lives for low prices!

You’re the competitive sort. But why are you so obsessed with beating Malaysian Airlines?
I’m not. They’re the ones who are obsessed with us, I think you’ll find. But anyway, it’s gone way passed that stage now. [Fernandes pauses as a journalist enters the room to have her picture taken with him, for which he produces his red AirAsia baseball cap.] MAS tried to stop us from growing by blocking our requests to open up the KL–Singapore route. Which is why there were tensions. But we’ve moved on since then.

The rivalry isn’t dissimilar to the tussles between Virgin and BA. Do comparisons to Richard Branson get on your nerves?
Not at all. But I’m really not trying to be him. I have no intention of flying in a hot air balloon or going to the moon.

Do you see yourself as a celebrity CEO, though, like Branson?
[Laughs] You know, it’s funny. At my son’s school, the kids were asked if there was a celebrity they wanted to meet and they chose me. I did a speech at a college the other day and 5,000 kids turned up. What you saw just now, with the girl who wanted to have her picture taken with me, happens quite a lot. It’s bizarre because I’m a simple kind of guy. I have no airs and graces. I suppose I’ve become such a public figure because AirAsia is something Malaysians are very proud of.

If you ran for office, do you think you’d win?
[Laughs] That’s a very dangerous question. I don’t know. Maybe.
If the electorate was just young people, I’d have a shot. But it’s not something I plan to do.

How have you become so successful?
From day one I’ve wanted to be as good as Ryanair [the world’s largest airline by international passenger numbers]. We are getting there thanks to a relentless commitment to our people. Happy staff is a priority. Happy customers, second. People with ambition should be rewarded. One of my cabin crew told me she wanted to become a pilot. I said why not. Plus, I often get behind the check-in desk myself. We’ve also stayed absolutely focused on what the AirAsia brand stands for: low cost doesn’t have to mean low quality. Sure, we have imitated EasyJet, Ryanair and Southwest Airlines. But we were the first to democratize air travel in Asia, and now everyone else is copying us. We have used PR and sponsorship to build the brand. We sponsor Premier League referees and linesmen, too, so I want lots of fouls and sendings off. I tried to put the AirAsia logo on the red card too, but they wouldn’t let me …

You are such a big part of the AirAsia brand. Do you have a succession plan in place?
I will eventually reach my sell-by date. It’ll be time to move on and reach for my guitar again. A new leader will come in. Hopefully a thinner version of me! In leadership, it’s important that when you go, you go. To stay on as a senior, mentor or whatever is not right. There are too many leaders in Asia who overstay their welcome.

So you will return to the music business?
Absolutely.

Do you use your music industry experience in business?
Yes, a lot. The launch of our London route was done using a new girl band I like called The Saturdays. We use music on our planes, on our website and we’re about to launch our own radio station.

Do you worry about your monster carbon footprint?
Look, we have more seats in our planes than most airlines. Besides, air travel constitutes only three per cent of global emissions. If every airline stopped operating tomorrow, you wouldn’t save the world.

What’s your game plan for next year?
We will take on the full service carriers. I want us to be as good as Singapore Airlines, which is the best airline in the world. We want to be as good as SIA economy. Our brand promise is that we’re low-cost. We’re not going to change that. Longer term, I want to buy SIA. It won’t happen next year. But that’s something I want to do before I die.