Airfare Wars

Malaysian Airlines launched a zero-fare campaign trying to get an upper hand over AirAsia's low costs airfare. Followsuit Tony Fernandes announcing Zero-Fare for AirAsia for the domestic flights as well. This is a good news for consumers. People tends to flight locally with the minimum costs.

However, is this a good or bad competition for the airliners? Can they sustain their business with such promotions? As we know MAS is losing money big time, and by doing so it will dampen further their financial status. As announcement made by MAS that they aren't in the red for the first time in years, and they are on the way up. But what I believe is that the figures shown is merely for public purposes. The actual figure is that MAS is still deep in the red if not for the leasing of planes carriage comes under government's funds.

As for AirAsia, they still new in the business, yet they are showing good turnovers and incomes generated from the low costs concept. From personal experience, I would say AirAsia is more profitable than MAS, and financially AirAsia has slight advantage over our national carrier.

So I think for this airfare war going on, the real beneficials will be us, the consumers, and the biggest loser will be MAS follow by AirAsia with such soaring fuel price at the moment.