AirAsia Zest banks on rebranding to rebound from losses

Officials of ZestAir are banking on the power of rebranding, in this case to AirAsia Zest, for financial  turnaround as well as more regional routes and flight frequencies, the budget airline told reporters at a briefing in Makati City Friday.

 

AirAsia Zest executive vice president and COO Joy Caneba said they expect to end the year in the black despite the losses incurred after the Civil Aviation Authority of the Philippine suspended the airline on safety concerns last August.

 

"Definitely it's going to be a positive year. The strategic plan is to end 2013 on a positive note despite the suspension," said Caneba.

 

"We want to prove we still have the support of customers, and rebranding will help turnaround our financial performance as we expect another aircraft delivery before year-end and a 15 to 20 percent increase in passenger count this year," she added.

 

Next year, Caneba said the airline expect to receive two to three new aircraft, more routes to run, an increase in frequencies, and probably top this year's passenger count.

 

On August 16, CAAP suspended Zest Airways Inc., operator of low cost carrier ZestAir, from flying in Philippine skies for failing to comply with flight standards after it was discovered that the airline was operating without an accountable manager.

 

CAAP lifted the suspension August 19 after the company was able to address the safety issues raised by government inspectors.

 

The airline estimated it was losing at least P70 million in revenues for each day it was suspended.

 

With the  rebranding approved by the Securities and Exchange Commission on September 18, Caneba said the ZestAir planes will be repainted with name and logo of partner AirAsia.

 

AirAsia Zest will be launched on Oct. 21, with AirAsia Group chief executive officer Tan Sri Tony Fernandes.

 

"On October 21, we're going to have a formal launching of the brand and that's where all the big stuff are going to be announced," Caneba said.

 

The “new” airline is going for the Mactan Cebu International Airport as hub for local and international flights.

 

"Starting November 15, we will have Cebu flights... flying to Puerto Princesa four times a week, and daily flights to Davao and Cagayan de Oro," Caneba said.

 

"There will also be an international flight from Cebu to Kuala Lumpur, Malaysia starting December 1," she added.

 

Last March, Philippines' AirAsia Inc., the local arm of Malaysia's AirAsia Group, signed a strategic alliance agreement to buy a 49 percent stake in ZestAir and 100 percent in Asiawide Airways – both under the ZestAir Group of former ambassador and juice drink magnate Alfredo Yao.

 

The deal called for Yao's group to subscribe to a 15 percent stake Philippines' AirAsia, diluting the shareholdings of Antonio Cojuangco Jr., Michael  Romero, and Marianne Hontiveros to 15 percent each. – VS, GMA News