AirAsia ride-hailing  service to enter Philippines

CEBU, Philippines —  The mother company of AirAsia Philippines, Capital A, announced its entry to the country’s ride-hailing space next year, challenging the lone player Grab Philippines.

“The Philippines needs competition. We want to inject a little bit of red into the green. We want to give Grab a run for their money,” said Tony Fernandes, Capital A’s president and chief executive officer in an interview.

By 2024, the company targets to start the commercial operation of AirAsia Ride, a ride-hailing platform that was first launched in Malaysia in August 2021. It has since expanded to 10 cities across Malaysia in just eight months.

According to Fernandes, the Philippines offers potential high-growth travel-related businesses, citing that tourism is one of the country’s “jewels” that need good infrastructure support, including low-cost land transfer access, among others.

“Everything we wanna do is bring down the cost of travel. We did it for flights. Now we want to make sure hotels, payment, ride-hailing all these things that add to your travel cost become affordable as well,” said Fernandes.

The entry of AirAsia Ride to the Philippines may mean lower cost of ride-hailing rates for the riding public, as well as attractive pay for its drivers “with full salary and provide more incentives.”

"We think that the drivers generally are the most important people, so we want to pay them a full salary, insurance, pension, give them accessibility to our low flights, etc.,” noted Fernandes adding that the drivers generally are the most important people, “so we want to pay them a full salary, insurance, pension, give them accessibility to our low flights, among others.”

In Malaysia, he mentioned AirAsia Ride is about 30 percent cheaper than Grab.

According to Fernandes, part of the company’s multi-billion-dollar investment plan for the Philippines is the introduction of a travel ecosystem that provides everything, including financial services related to travel expenses.

"Initially we’ll just get our own license. So we’ll fly you in the sky and we’ll take you on the ground as well,” he added.

The ride-hailing app is available in airasia Superapp, a one-stop travel platform offering services from flights, hotels, ride-hailing, loyalty programs, and more.

Capital A, formerly known as the AirAsia Group, officially launched the airasia Superapp in the Philippines on April 6, 2022, with the aim of further stimulating the country’s strong e-commerce market.

Capital A, recently announced its commitment to spend about US$1 billion in investments in the Philippines, including its plan to add more flights from Cebu.

Fernandes said the US$1 billion (about P54 billion) investments for the Philippines will involve buying at least 50 new aircraft to fulfill its plan to increase flights from Cebu, and other parts of the country, the establishment of a Maintenance Repair and Overhaul (MRO) plant in Cagayan de Oro City, entering into ride-hailing business, logistics, among others.