AirAsia's Fernandes bets big on boyhood idea
KUALA LUMPUR/LONDON (Reuters) - AirAsia (AIRA.KL) boss Tony Fernandes has never done things small, whether running Asia's biggest budget airline, managing a Formula One team or launching a bid for an English soccer club.
But by smashing the aviation industry's record for the number of planes in one order and becoming Airbus's biggest airline customer with an $18 billion purchase of 200 jets, the charismatic 47-year-old Malaysian has surprised even himself.
"I didn't realise I was their biggest airline customer until today, and it's a kind of an odd feeling," Fernandes told Reuters shortly after shaking hands on the deal.
"I never realized I would get that size of testament to the staff at a company creating such a successful model."
His bold move at the Paris Air Show is part of an ambitious expansion plan that he hopes will see AirAsia's fleet size rival industry titan Southwest Airlines (LUV.N).
His ambition to run a low-cost airline was first kindled while studying as a boy at Epsom College in Britain.
"I always liked the idea of a low-cost airline, having gone to boarding school and wanted to go home more often, and the idea was always in my mind."
His two great sporting passions back then were Formula One and West Ham United football club, for which he bid unsuccessfully when it was last sold and is still interested in buying now that they have slipped out of the Premier League.
"I grew up watching our version of Formula Three in Malaysia when I was five years old. I used to camp out at Brands Hatch (as a schoolboy). In fact the first (toy) model I bought at Brands Hatch was a (Lotus) JPS car," he told Reuters shortly after his bid to join Formula One with Lotus Racing succeeded.
They became Team Lotus this year after a falling out with Proton-owned Group Lotus, now sponsors of Renault F1.
He and his partners are also the owners of a car company, having recently bought niche sportscar maker Caterham, whose current 7 model is based on the classic Lotus 7 first built in the late 1950s, another toy in the young Fernandes collection.
JEANS AND CAP
A UK-trained accountant and former Warner Music executive, Fernandes bought over the then loss-making AirAsia in 2001 from Malaysian conglomerate DRB-Hicom (DRBM.KL) for about 33 cents and took on the airline's debt of $13 million.
He grew the business from two Boeing planes, one destination and a staff of 250 into a regional operation with 375 aircraft delivered or on order, 65 destinations and almost 7,000 workers.
Forbes estimates his net worth at $470 million, but he works out of a nondescript cubicle at Malaysia's low-cost air terminal and prefers jeans and his trademark red AirAsia cap over business suits.
But there is little else that is understated about the man.
An aggressive marketer and now an active Tweeter, Fernandes raised AirAsia's profile through the years via a series of cheeky, bright red advertorials and a long-running verbal war with rival flag carrier Malaysian Airline System (MASM.KL).
He has pushed hard for landing rights and butted heads with the Malaysian government over securing new routes.
As a young boy he learned the art of selling when he tagged along with his mother to Tupperware dealer parties and credits his years at boarding school for shaping his work ethic.
"Despite being a different colour and different nationality, it taught me that you earned your rewards by merit," Fernandes has said of his time at the English private school.
Some of his co-workers paint a picture of a stubborn man who is determined to chart his own course.
"He's very fair," said Tune Talk chief executive Jason Lo, a former musician who worked with Fernandes during his Warner Music days. "He'd be very fair to you even if he really despised you." Fernandes and another investor own 70 percent of Tune Ventures, which has a 35.7 percent stake in Tune Talk.
A non-smoker, he said it was only when discussing a JPS-reminiscent black and gold racing car livery that he discovered the cigarette brand was still sold in Britain.
Fernandes applies the same alcohol-free and halal approach to his Formula One team catering as he does to AirAsia's regional flights in Asia.
His two-tier Formula One motorhome makes much of the old Lotus connection, with black and white photographs on display, while the team's factory at Hingham, a small market town in Norfolk, is near the old Lotus base at Hethel.
A regular at most races with his green team uniform and trademark red AirAsia cap, Fernandes nonetheless missed this year's showcase Monaco Grand Prix, the social highlight of the F1 season, preferring instead to stay at his house in Bali for his son's half-term break.
And if he had to choose between his airline and racing team?
"That's a very hard question," he says after a pause.
"I love the challenge in Formula One right now just because while no-one gives us a chance, it is a wonderful opportunity to show what Malaysia do against the best in the world.
"Formula One is a really global sport. And having built AirAsia up from two planes, it would be hard to choose. Hopefully I won't have to." (Additional reporting by Tim Hepher; Editing by Will Waterman)
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