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AirAsia launches food delivery service in Singapore, offers two-week free deliveries for orders within 8km

SINGAPORE — Malaysian budget airline AirAsia Group on Tuesday (March 2) launched its food delivery service in Singapore with at least 24 food-and-beverage outlets listed on its platform, joining a highly-competitive market dominated by established players.

So far, the airline’s latest venture, AirAsia Food, has 500 riders here to deliver the orders and another 300 food operators in the process of getting on board, Mr Lim Ben-Jie, head of e-commerce for the AirAsia super app, said.

So far, the airline’s latest venture, AirAsia Food, has 500 riders here to deliver the orders and another 300 food operators in the process of getting on board, Mr Lim Ben-Jie, head of e-commerce for the AirAsia super app, said.

  • AirAsia Food launched on Tuesday with at least 24 food-and-beverage outlets and another 300 in the process of getting on board
  • For two weeks until March 16, it is offering free delivery for orders within 8km
  • It is positioning its food delivery service as the cheaper option for merchants and for customers
  • The airline plans to launch a fresh produce delivery service and an unlimited flight pass soon

 

SINGAPORE — Malaysian budget airline AirAsia Group on Tuesday (March 2) launched its food delivery service in Singapore with at least 24 food-and-beverage outlets listed on its platform, joining a highly-competitive market dominated by established players.

So far, the airline’s latest venture, AirAsia Food, has 500 riders here to deliver the orders and another 300 food operators in the process of getting on board, Mr Lim Ben-Jie, head of e-commerce for the AirAsia app, said at an online press briefing.

The company promises delivery fees 5 per cent lower than its competitors and is offering a two-week free delivery for orders within 8km until March 16.

Orders can be made on the AirAsia Food website or through its “super app”, where flights can also be booked.   

AirAsia Group’s chief executive officer Tony Fernandes said: “At AirAsia Food, our mission has always been to help local food businesses keep their cost low by offering a much lower commission rate that can then be passed on to customers so they can enjoy even lower prices for their favourite dishes.”

Among the restaurants already taking orders are: Swee Choon Tim Sum, Maki-san, PizzaExpress and Indian Wok.

The company is hoping to draw more food and beverage operators on board by offering a lower commission charge of 15 per cent on each transaction.

TODAY understands that the three major food delivery platforms here — GrabFood, Foodpanda and Deliveroo — are charging market rates of between 25 and 35 per cent.

Mr Lim estimates that its riders can earn up to S$700 a week on average if they deliver 10 orders per day for six days a week.

Its riders will be staffed by AirAsia’s logistics arm Teleport which launched in Singapore last year.

In response to TODAY queries, Deliveroo said on Tuesday that its riders earn an average of S$17 per hour, but this “varies from rider to rider given their flexible work schedules”.

Foodpanda said last year that its riders were earning S$7.50 per delivery on average.

Mr Fernandes drew parallels between how it runs its low-cost carrier to how it sees the role AirAsia Food will play in Singapore’s food delivery market.

“Just like AirAsia doesn’t have all the frills of Singapore Airlines, AirAsia Food, for instance, (won’t) have maps. We don’t think you really need to know where your driver is, because that costs us,” he said.

The company sees its value in getting smaller restaurants and hawkers a means to get into the food delivery service without being “taxed heavily with very very high percentages”, Mr Fernandes said.

AirAsia Food, which started operating at Klang Valley last May, is still expanding to more Malaysian cities and considers itself a smaller player in Malaysia so far.

Mr Fernandes had told Malaysian newspaper New Straits Times last December that it was fulfilling 1,000 food deliveries a day, while the “big boys” were fulfilling 55,000 deliveries a day.

After Singapore, AirAsia Food plans to launch in Thailand, Indonesia and the Philippines before the end of this year.

The budget carrier’s foray into the food delivery market in Singapore comes as airlines around the world are hit hard by air travel disruptions because of Covid-19 and are forced to find other sources of revenue to survive.

For AirAsia, it also plans to move into the fresh produce delivery market in Singapore soon where consumers can have fish from Japan or short ribs from Korea imported and delivered to their homes in Singapore within 48 hours.

And within the next two to three months, AirAsia also plans to launch a yearly pass where customers can book unlimited flights from Singapore to another Southeast Asian country and enjoy free food delivery.

Said Mr Fernandes: “It took us seven years to get a flight from Kuala Lumpur to Singapore. It’s taken us seven weeks to launch our food service. So the world has changed.”

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