An all-you-can-fly pass? One airline says the model meets the demands of COVID-era travel

October 27, 2020, 5:47 AM UTC

The travel industry has been decimated by the pandemic, as governments worldwide implement strict lockdown measures to prevent contagion. But CEO Karen Chan remains remarkably optimistic.

“If you don’t see a silver lining, you have to go and create one,” Chan told the Fortune Global Forum on Tuesday. Airline operator AirAsia is seeking its silver lining by expanding into hotel booking and mobility services in an effort to rebrand itself as an online travel agent “supported by an airline.”

Those new areas of focus will better serve domestic travelers, who currently occupy a larger segment of the travel market than international tourists. International travel is unlikely to return to its pre-pandemic levels for at least six months, Chan said.

Already, a number of countries around Asia have opened up so-called green channels, which typically waive quarantine requirements for business travelers under certain circumstances. Chan said Malaysia-based AirAsia worked with the government in Kuala Lumpur to negotiate such a channel between Malaysia and Singapore.

Now governments are moving to introduce “travel bubbles”—or an agreement between two destinations that allows all residents to travel without quarantine. Hong Kong and Singapore are currently discussing how to implement such a scheme. With a combined population of some 12 million, the Hong Kong–Singapore travel bubble could become the most significant quarantine-free travel arrangement to date.

But many countries that appeared to have the pandemic under control at one point this year later experienced sudden surges in case numbers. So even a travel bubble will be subject to change. Chan said AirAsia has prepared for this uncertainty by launching a new subscription-like model for air tickets called an “unlimited flight pass.”

“We understand that with the COVID situation consumers want flexibility. They want date changes without being penalized and having to pay processing fees,” Chan said. The new service lets customers pay once to fly as many times as they please over the following 12 months.

According to Chan, AirAsia has already sold close to 200,000 of the passes in both Thailand and Malaysia, and the company is looking to expand the service to other markets. “It has really taken off,” Chan said.

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