AirAsia’s co-founder, Tony Fernandes, met with Malaysia’s Ministry of Finance two weeks ago to discuss potential government-backed funding support for the airline, said three people with inside knowledge. The three sources said the discussions reflect the government’s growing concern for the country’s largest domestic carrier’s financial health following a price spike in jet fuel.
The discussions with the government
Two of the people said the discussions have been centred around the possibility of the government supporting AirAsia’s fundraising efforts if the airline agrees to conditions proposed by the government. Details of the proposed conditions couldn’t be found by Reuters.
In an exclusive interview with Reuters on Friday, Fernandes said that, at his request, he had met with officials from Malaysia’s finance and transport ministries in the week of Sept. 28. He said the discussions centred around aviation-related costs such as airport charges and jet fuel price increases, not financial assistance.
He said he didn’t meet with the ministries looking for help, nor did the government raise concerns about AirAsia’s finances, saying instead:
“Obviously, like every airline in the world, we are telling government that this is a tough period. There have been no discussions on financial assistance with the government. I meet with government officials all the time…just because I meet them doesn’t mean we’re talking about financial assistance.”
Fernandes said he’s confident AirAsia can navigate the situation without government backing as it had during the pandemic, but he also said that the airline wouldn’t turn away help if offered by any government in the countries it operates in, saying:
“We will never say no to it. We would be foolish to do so.”
Representatives from Alton Aviation Consultancy, which the Ministry of Finance has previously hired to assess loss-making AirAsia’s funding needs, were also in attendance at the meeting, two of the sources said.
On Monday, Malaysia‘s Transport Minister, Anthony Loke, told a press conference that he hasn’t had any meetings with AirAsia in the last two to three weeks, nor have other officials from the Ministry of Transport. He said:
“[AirAsia] may have had discussions with the Ministry of Finance. These airlines do have regular meetings with the government.”
AirAsia town hall with government officials
Two of the sources said the meeting with the government followed a company town hall Fernandes held on Sept. 28 at AirAsia’s headquarters. There, he told staff that the airline would overcome its current difficulties, saying;
“We’ve been through many tough times before. We will come out of it stronger. The big difference between this and COVID is we can actually fly.”
AirAsia has said it’s targeting up to $1 billion from international debt markets, plus 700 million ringgit in local credit facilities. On Friday, Fernandes said he expects the $1 billion fundraising to be completed between December 2026 and February 2027, with half used to refinance loans and the rest for working capital and paying off “extended liabilities.”
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