AirAsia Downgraded: Fernandes Support of Najib Will have Consequences

AirAsia Downgraded: Fernandes Support of Najib Will have Consequences

AirAsia Downgraded: Fernandes Support of Najib Will have Consequences

Ongoing investigations are possible as the relationship between AirAsia, Najib and the Government will come under scrutiny in coming months.

The Malaysian aviation regulator will investigate claims made by AirAsia boss Tony Fernandes that he had been “summoned” and told to cancel extra flights for last week’s elections, Malaysia’a Star reported.

In a video dated May 13, Fernandes had claimed that the Malaysian Aviation Commission (Mavcom) had “summoned” him to cancel 120 extra discounted flights which would have carried 26,000 people during the elections.

Mavcom said that it considers these claims to be “serious allegations.”

“We have immediately commenced an investigation into these claims,” said a Mavcom spokesperson yesterday night. “We will keep members of the public informed.”

Fernandes also claimed in the video that he “came under intense pressure” to support Barisan Nasional to protect the future of AirAsia, as aviation is a “very regulated industry where almost everything requires the approval of the Government.”

AirAsia chief Tony Fernandes apologised on Sunday for endorsing Najib Razak ahead of Malaysia’s general election, saying he had done so to appease the office of the then prime minister who eventually lost his bid for another term.

Two days before Wednesday’s poll, Fernandes released a video praising Najib and the government’s support of the low-cost airline he co-founded. Later that day, Najib posted photos of him and Fernandes standing in front of an AirAsia plane painted with a campaign slogan for Najib’s coalition.

“I am sorry for what has gone on. I buckled at the crucial moment in our history,” Fernandes said in a video released on Sunday. “It wasn’t right and I will forever regret it.”

Particulary hard hit in morning stock market trade was AirAsia Group Bhd, whose chief executive Tony Fernandes endorsed the incumbenmt Najib during the campaign. Its shares fell as much as 10 percent at the open before paring some of the losses.

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S. Jack Heffernan Ph.D. Funds Manager at HEFFX holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

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