AirAsia Plans No Layoffs despite Massive Reorganisation

February 27, 20189:31 am1141 views

Asia’s low-cost carrier based at Malaysia, AirAsia Berhad (AAB) has no plans to conduct any employee reduction despite its major consolidation on business and expanding market share.

As part of the efforts to boost efficiency, the company is currently embarking on a massive reorganisation. The exercise is meant to realign various affiliates and businesses under one roof, to create a leaner and more streamlined group structure. In fact, the airline plans to add more planes and continue to expand in terms of human resources, The Malaysian Reserve reports.

“We don’t have any or announced or declared plans or layoffs,” said AirAsia’s HR chief and culture officer Varun Bhatia. Mr Bhatia further said that the company is constantly reorganizing itself to keep up with business and customer’s needs while responding to the changes in technology and processes.

He said, “Companies that say they’re very stable and don’t go through too many restructurings and changes are not going to survive. We are constantly reorganising. My challenge is to make sure we’re managing the change well. We’re stabilising it without making it stale.”

According to Mr Bhatia, the company will continue to bring in new talented individuals to meet the operational demands of its expansion plans, which include adding close to 30 new planes in 2018. About 2,500 to 3,000 new roles are expected to be created, with turnover on a base of 22,000 employees.

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Growing rapidly since 2001 with just two original aircraft, the airline has been expanding as its regional businesses and routes grow. This year, AirAsia plans to be hiring with same method as last year. In 2017, 4,500 job openings are filled as new planes were added and commercial areas being strengthened, along with regular attrition and turnover.

Last month, the company received shareholder approval for its restructuring and the transfer of its listing status to the new holding company, AirAsia Group Bhd (AAG). Meanwhile, the reorganisation, which is expected to be completed by March 2018, will also see the merging of various affiliates under one roof, to implement the group’s strategies to expand rapidly across its core markets in South-East Asia.

Besides its Malaysian operations, AirAsia also has five affiliates in the Philippines, India, Thailand, Indonesia, and Japan. Additionally, the carrier’s digital-related services and intellectual properties will also be consolidated into five separate business segments.

Under the internal reorganisation by way of members’ scheme arrangement, which was proposed in August 2017, AAG will assume AirAsia’s listing status as an investment holding entity under a one-for-one share swap deal. AirAsia will retain the Malaysian airline business and focus on its airline operations, while becoming a wholly owned unit of AAG.

The reorganisation is also expected to facilitate future spin-off of the group’s operations and unlock the value of its investment in its subsidiary, joint ventures, as well as associate companies.

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