AirAsia’s entry to the Philippines was quick, but its entry to use Manila as its hub took a few years. When slots at the congested Ninoy Aquino International Airport in Manila were at a premium, AirAsia had to find an expensive way to get in. So we now talk about how AirAsia found its way into the congested Manila Ninoy Aquino International Airport.
Beginnings at Clark International Airport
In 2011, the country had four significant carriers: Philippine Airlines, AirPhil Express, Cebu Pacific, and Zest Air. We also had “SEA Tiger,” or the tie-up between Tiger Airways and SEA Air. The four significant airlines were head-to-head competing in the domestic sector. Slots at NAIA were getting scarcer as airlines added more aircraft to the fleet, particularly AirPhil Express, Cebu Pacific, and Zest Air.
In 2010, a joint venture was formalized between AirAsia Malaysia and a group of investors in the Philippines consisting of Antonio “Tonyboy” Cojuangco, Michael Romero, and Marianne Hontiveros. This was AirAsia Philippines. 40% belonged to the Philippine owners, and AirAsia Malaysia owned 60% of the shares under AirAsia Group CEO Tony Fernandes.
The goal, of course, was to use Manila as its central hub. However, slotting problems and congestion was already a problem during that time. Hence, the faster way was to operate from Clark International Airport.
AirAsia Philippines took its first flight from Clark to Kalibo on March 28, 2012, at 7 am. The second flight was from Clark to Davao.
Share swap with Zest Air
To really gain slots in Manila, you had two major options:
- Wait for an airline to give up their slots
- Buy into an airline with slots in Manila
Zest Air was also a domestic carrier operating domestic flights from Manila owned by the orange juice magnate Alfredo Yao of AMY Holding, the owners of Zest-O. Formerly Asian Spirit airlines, Zest Air was known to be an ultra-low-cost airline directly competing with AirPhil Express in terms of low fares. Yes, they had the cheapest fares then, more affordable than Cebu Pacific.
In 2013, AirAsia Philippines entered a share swap deal with Zest Air. The latter received a mix of $16 million in cash and a 13% share in the former. On the other hand, AirAsia Philippines now owns 85% of Zest Airways, with 49% of its voting rights.
Finally, AirAsia, through a rebranded AirAsia Zest, now had slots at the Ninoy Aquino International Airport in Manila!
A new life at the NAIA
AirAsia was slowly winding down its operations at Clark as it transitioned to its new central hub in Manila. They began domestic operations from the NAIA terminal 4. AirAsia Zest still carried the IATA code Z2, originally from Zest Air.
In 2016, the merge between AirAsia and Zest Air was finalized. The “Zest” branding was finally dropped with the aircraft’s whole “AirAsia” livery. Philippines AirAsia was finally formed.
From then on, Philippines AirAsia, which is still known as “AirAsia Philippines”, has become the third major airline in the Philippines offering both domestic and international flights. Before the covid-19 pandemic, they were operating from 4 hubs namely Manila, Clark, Kalibo, and Cebu.
This year 2022, AirAsia Philippines is slowly restoring its other hubs outside of Metro Manila, such as Cebu. This will give passengers more interconnectivity options from the Visayas area without the need to fly to Manila. AirAsia Philippines is targeting to acquire brand new Airbus jets from 2023 and beyond, such as the A321neo and, hopefully, the A330neo.
First love never dies. I fell in love with airplanes and aviation when I was a kid. My dream was to become a pilot, but destiny led me to another path: to be an aviation digital media content creator and a small business owner. My passion for aviation inspires me to bring you quality content through my website and social accounts. Aviation is indeed in my blood and blog!
