KUALA LUMPUR - MALAYSIAN budget carrier AirAsia on Wednesday scrapped administrative charges to boost passenger numbers but said it has not been hurt by the downturn that has affected most airlines worldwide.

Chief executive officer Tony Fernandes told AFP the company would lose RM400 million (S$166 million) a year by getting rid of the charges but said he wanted to keep a promise of providing the lowest fares.

'I continue to remain bullish. Any product that can reduce cost will make more profit,' he said. 'I have been in the business for the last seven years. There has been perpetual headwinds such as the outbreak of Sars (Severe Acute Respiratory Syndrome in Asia in 2003) and tsunami. We will continue to grow.'

He added that passengers now need to pay only the fare and airport tax. Administration charges range from RM22 to RM43 per person.

The world's airlines are expected to lose US$9 billion (S$13.1 billion) this year, industry body IATA said early this month in a drastic reassessment of the worst slump the industry has ever faced.

Carriers in all regions are expected to report losses in 2009, with Asia-Pacific airlines - once the brightest spot of the industry - accounting for more than a third of the global losses at US$3.3 billion.

Mr Fernandes said AirAsia will not defer arrivals of its Airbus A320 aircraft while its route expansion plans remained on track despite the bleak outlook of the sector.

'We are not affected by the swine flu outbreak. We have not deferred our plane orders. We are doing very well. We are growing our capacity,' he said as the carrier planned to add Colombo to its route in August.

Mr Fernandes said its new fleet of A320s were fuel savers, which helped to lower operational cost.

AirAsia became the world's biggest customer for the Airbus A320-200 after placing an order for 175 aircraft in December 2007, with an option for 50 more. -- AFP