Air Asia X slashes fares as it seeks expansion in Korea

Air Asia X, a Malaysian long-haul low cost carrier, is offering flights to Kuala Lumpur for as little as 100,000 won ($85) as part of its drive to expand its presence in the Korean market.

According to the company’s CEO Azran Osman-Rani the limited time offer, which ends on Oct. 4, is only a small part of Air Asia X’s strategy for taking a larger share of Korea’s growing market for low-cost air travel.

Along with the promotional discount tickets, the company plans to begin selling soju on its flights to and from Seoul. Osman-Rani said that his company is also in talks with a Korean entertainment firm to form a sponsorship contract for a major music act in an effort to attract more Malaysian passengers, a significant proportion of which come to Korea attracted by the hallyu phenomenon.

“Korea is a very important market (for the company). We need to keep investing to increase familiarity of our services in Korea,” Osman-Rani said. He added that Korea accounts for about 10 percent of the company’s annual sales, and that the Korean market has much room for growth. According to Osman-Rani, low-cost flights account for less than 20 percent of the Korean market, while the average for Asia is about 20 percent. The figure for the U.S. and Europe stands at about 40 percent, he said.

According to Osman-Rani, while the overall aviation market is projected to grow by between 5 percent and 7 percent, the growth rate for low cost carriers is projected to be about three times higher as their market share jumps from the current 20 percent to 40 percent.

By Choi He-suk (cheesuk@heraldcorp.com)