Chronicle of a high flier

Book review of 'Flying High: My Story from AirAsia to QPR'

Flying High

My Story from AirAsia to QPR

Tony Fernandes

Portfolio Penguin

244 pages; Rs 699

Tony Fernandes must be one of the luckiest men alive. How many of us can think of achieving even one dream one had as a kid? As a boarder in a public school in 1970s Britain, young Anthony had three dreams — he loved sport, music and aeroplanes.

Since leaving Epsom College in Surrey, Mr Fernandes has headed a global music business (Warner Music) and partied with the biggest pop stars in the world. He bought a struggling English soccer club, Queen Park Rangers, and helped it reach the English Premier League after a 15-year hiatus. He had stood at the starting grid at the Grand Prix with his own Formula One car. And, he has carved his name in business history by acquiring a failing airline, AirAsia, and turning it into Asia’s first budget carrier, and a hugely successful one at that.

Most autobiographies are so personal that in most part, they become boring, and Flying High is no exception. So often the reader is subjected to how Mr Fernandes grew up in the Malaysian capital Kuala Lumpur, in privileged family with a reserved, but sports-mad doctor father and a dominant, showy, entrepreneurial mother plus all the unnecessary details of shifting houses, celebrity guests, first flight, first solo flight, regular boarding school banter, pranks and all.

In places, however, you glean the measure of the man from how he reacted to situations in his formative years. For instance, his mother’s manic depression threw him into sports even harder, and landed him at the English school where he picked the value of camaraderie that came in handy to become a successful businessman later in life. Or more prophetically, complaining about homesickness to his mother, and being told it is too expensive to fly him back to Kuala Lumpur more often made him think about the idea of making air travel cheap as a 13 year old in the late seventies. Travel “opened my eyes” remains a recurring theme across the book and lessons he picked – how segregation was deep in American culture, Australian disdain for the Aboriginals to British embarrassment at success – and how it influenced him to build culture/race/faith-inclusive firms later in life.

Though impressed with Richard Branson’s from-the-gut style of management – his employer at Virgin TV – for Mr Fernandes, an accountant by profession, the real inspiration to get into the airline business was Stelios’ EasyJet, the orange-branded low-cost airline that was taking the UK market by storm in the early 2000s. 

Mr Fernandes was clear; he wanted to start a low-cost airline operating in Asia. However, it was easier dreamt then done. Though the then Malaysian Prime Minister, the legendary Mahathir bin Mohamad, was supportive of the low-cost airline idea, he was reluctant to give a licence for a new one, and suggested Mr Fernandes buy an existing airline. A chance meeting at the golf course with a senior executive of one of Malaysia’s leading manufacturing group, DRB-HICOM, which owned a tiny and struggling airline, AirAsia, was the turning point.

Mr Fernandes leveraged his Epsom contacts and used his selling skills to make GE Capital Aviation Services agree to remove the DRB’s corporate guarantee for the lease of two 737-300s, and bought AirAsia for one Malaysian ringgit in 2001! But the airline still had $20 million of debt, and losing $4 million a month. The deal was struck two days before 9/11, and airline lease rates just collapsed after the attack on New York’s twin towers. And that changed the math for AirAsia under its new owner.

“Flying by the seat of our pants,” like Mr Fernandes likes to call it, AirAsia learned and adapted to the low-cost model fast. It ripped out the business class completely to make space for 24 more seats on an 737-300, bought sandwiches, drinks and water at the Carrefour supermarket and sold it to passengers, went for online ticketing, and borrowed, loaned or bartered for just about anything to conserve cash. 

Mr Fernandes worked all the jobs in the airline – training at the simulator, changing wheels, carrying bags to serving passengers as a cabin crew – because he believed there was no way one can be an effective CEO without getting your hands dirty. AirAsia created a market of first-time fliers in Malaysia even as bigger, established airlines like Malaysian Airlines and Singapore Airlines focused on the full-service model, and became an inspiration for low-cost flying in the entire region — from Thailand, Singapore, Indonesia to India.

Though Mr Fernandes makes a big push in the book for what he calls his top quality – persistence – it is not an empty boast. Persistence did help pull the airline back from the brink several times — like making wrong calls on oil price hedging nearly wiping out AirAsia’s carefully built billion ringgit-strong cash hoard in the wake of the 2008 global financial crisis or emerging stronger as a brand and business from the AirAsia Indonesia plane crash with 167 passengers and crew onboard in December 2014, any airline’s worst nightmare.

Though Mr Fernandes dabbled in other businesses – a disaster in Formula One and middling success in Queen Park Rangers (the book has a chapter each on it) – the airline remains “the spine of his working life”. Without AirAsia there would be no straight-speaking, often pushy, party- and tweet-mad Tony Fernandes as the business world across much of Asia and Europe knows him.