AirAsia X to Operate Dedicated Cargo Flights for GEODIS

(26 Jan 2022)  AirAsia X (AAX) has signed an agreement with GEODIS to provide dedicated scheduled cargo flights between Kuala Lumpur and Hong Kong, Chennai, Shanghai and Sydney.

The deal, which came into effect on 20 January 2022, is set to run for an initial period of six months with further extensions to be reviewed on a rolling basis.

With an extensive footprint in Asia Pacific, the partnership with GEODIS will not only complement the existing AAX network but will also stimulate additional air-cargo traffic in a number of markets that both companies operate in.

Through its hub and spoke model, including the ability to switch transport modes at the Kuala Lumpur facility, the network also benefits from GEODIS’ expansive road network to ensure that cargo from its flights to Singapore, Malaysia, Thailand and Vietnam, are able to be transported across the whole of Southeast Asia.

Thai AirAsia X A330 reg: HS-XTD. Picture by Steven Howard of TravelNewsAsia.com

“It is more crucial now than ever to supplement integrated transport networks with strategic routes that offer customers a high degree of efficiency, personalisation and flexibility. Especially given the increasingly complex supply chain landscape that has affected the logistical expectations and needs of industries across the board,” said Onno Boots, President and Chief Executive Officer, Asia Pacific, GEODIS. “These new intra-APAC flight routes represent our sustained commitment in bringing customers highly reliable, innovative, and cost-effective solutions that are tailored to what their business truly needs, allowing them to fully optimize the e-commerce boom and chart their long-term business growth. We look forward to working in partnership with AirAsia X to strengthen its logistics footprint.”

The partnership is the first of many that will AirAsia is expected to finalise in coming months. These augment the significant short term cargo charters completed in recent months and represent a rapid financial turnaround post a comprehensive successful restructuring of the airline.

Benyamin Ismail, CEO of AirAsia X Malaysia, said, “Air cargo rates will continue to remain robust as long as planes remain grounded. We intend to capitalise on this opportunity for as long as it lasts. Cargo revenues were 4% of our total revenues pre-COVID. It has been our lifeline over the past two years. We expect that our cargo operations moving forward will contribute at least 40% to 50% of our total revenue. Importantly we are now perfectly hedged to take advantage of the huge surge in air transport demand. Furthermore, passenger revenue will offset any drop in cargo rates when we start normal scheduled flights again. We are tremendously excited with this new opportunity with GEODIS. We have operated ad hoc charter services for them in recent months but this new arrangement provides better certainty on utilisation of our planes and better visibility of earnings.”