This article first appeared in The Edge Financial Daily on March 27, 2020

KUALA LUMPUR: Low-cost carrier AirAsia Group Bhd and its long-haul arm AirAsia X Bhd (AAX) will ground most of their fleet and suspend flights from tomorrow, except a small number mostly within Indonesia and Thailand.

The carriers are the latest to join airlines around the globe to do so as travel demand drops because of the Covid-19 pandemic and cross-border travel restrictions.

To further manage and contain costs, AirAsia said its management and senior employees will forego their salaries, ranging from 100% at the very top to 15%.

“This will help ensure that we can ride out this prolonged period of extremely low travel demand and at the same time minimise the impact on our employees, especially those in junior positions,” it said in a statement yesterday.

AirAsia will temporarily suspend all international and domestic flights in Malaysia from tomorrow to April 21, while those operated by AirAsia Philippines will be suspended from March 20 to April 14.

AirAsia Thailand will halt its international flights from March 22 to April 25, while AirAsia Indonesia will significantly reduce its international operations. Both airlines will continue to operate domestic flights but at reduced frequency.

Meanwhile, AirAsia India has suspended its flights since Wednesday until India’s travel ban is lifted.

AAX will also ground most of its planes in Malaysia from tomorrow to May 31, while AirAsia X Thailand has suspended its operations for three months since March 16.

“We will continue to evaluate the situation closely and we are prepared to reinstate our services as soon as the situation improves, subject to the necessary regulatory approvals,” said AirAsia.

“We believe this temporary fleet hibernation is the right thing to do to ensure the well-being of our guests and employees, which will remain as the top priority of our business during this challenging time,” it added.

It was previously reported that the chief executive officers of AirAsia, Malindo Airways Sdn Bhd, Malaysia Airlines Bhd and FlyFirefly Sdn Bhd had met with Finance Minister Tengku Datuk Seri Zafrul Aziz to discuss financial aid and other reliefs as airlines struggle to find funds to operate.