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AirAsia abolishes fee in bid for sales

MALAYSIAN budget airline AirAsia yesterday abolished administrative fees on all its flights in a move to reduce fares and bolster sales amid the global slowdown.

Chief Executive Tony Fernandes said passengers will now pay only the fare and airport tax. AirAsia removed fuel surcharges in November last year.

The fee ranged from 22.5 ringgit (US$6.40) to a maximum of around 43 ringgit per ticket and removing it will cost the airline 400 million ringgit a year.

Fernandes said the region's biggest budget carrier was confident it could increase ticket sales and generate income from other sources to offset the loss of revenue.

"It's been a tough six months for the airline industry but AirAsia is getting stronger and stronger. We believe we will increase our load factor and become more competitive," he said.

AirAsia said net profit in the quarter to the end of March hit a record 203.2 million ringgit, up 26 percent from a year earlier.


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