AirAsia offers 1m free seats

Low-cost carrier AirAsia is giving away 1 million free seats in a costly gamble to boost future traffic demand.

Local subsidiary Thai AirAsia is participating in the scheme.

Asia's largest budget airline group hopes to offset the free fares, estimated to cost at least 2 billion baht, with earnings from optional services such as in-flight food and beverages and priority boarding.

Thai AirAsia chief executive Tassapon Bijleveld yesterday said the offer was primarily aimed at creating "excitement" in the Thai and regional tourism markets.

The free seats will raise the carrier's load factor from Jan 3 to May 8, 2011, when travel under the promotion is permitted, said an industry source.

The 1 million seats, which cover 130 routes across 20 countries, will be available on a first-come, first-served basis on http://www.airasia.com and mobile.airasia.com from today (18May) until May 23.

While the fares are free, passengers will have to pay airport taxes and other fees totalling 207 baht per sector for Thai domestic flights and 800 baht for international flights.

Meanwhile, Mr Tassapon said the Thai AirAsia recorded positive financial results in the first quarter by posting a 30% year-on-year rise both for revenue and passenger volume. Thai AirAsia carried 1.48 million passengers in the quarter. Revenue was not disclosed.

Despite fallout from the Thai political crisis, the airline chief remains optimistic Thai AirAsia can achieve its revenue and passenger volume targets for the year.

"We're flexible to changes in environment," he said. "We will continue to increase flights, offering promotional fares and staging activities to promote tourism and travel."