AirAsia CEO apologizes for election video

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KUALA LUMPUR — Malaysia’s best-known businessman, Tony Fernandes, published a video Sunday apologizing for supporting former Prime Minister Najib Razak ahead of last week’s elections loss, prefiguring what could be a period of corporate realignment in a country where political connections often determine whether businesses succeed or fail.

“I buckled. It wasn’t right, I will forever regret it,” Mr. Fernandes said in a video he uploaded to his Facebook page, according to a Wall Street Journal report.

Mr. Fernandes, 54 years old, is a household name in much of Asia. A former music-industry executive, he turned a rundown carrier called AirAsia into one of the world’s most successful budget airlines by tapping into an explosion in air travel. He played the Donald Trump character in the Asian spinoff of “The Apprentice” television show and invested in Formula One motor racing and an English soccer club.

He has sometimes supported government political candidates in the past. But he also butted heads against regulators to secure landing rights or build airport facilities for AirAsia. Mr. Fernandes has said that, as an ethnic-Indian Malaysian, he was disadvantaged when competing against the majority Malay establishment symbolized by the United Malays National Organization. That organization ruled the country uninterrupted for over 60 years, until newly installed Prime Minister Mahathir Mohamad’s shock landslide win on May 9.

His passengers, then, were surprised—and many of them were dismayed—to see him appear in a video that came out in the election campaign in which he talked about how Mr. Najib’s government had helped him grow his business.

Mr. Fernandes painted one his normally red-and-white aircraft in blue government colors and flew it to pick up Mr. Najib from a campaign rally and fly him to Kuala Lumpur, with the two men smiling for photos in the front. Some passengers threatened to boycott AirAsia, while others questioned what kind of pressure had been applied to Mr. Fernandes.

“I never imagined that he would do that,” said Aziz Abdullah, 38, who said he regularly flies on AirAsia.

Mr. Fernandes said he made the campaign pitch to fend off Mr. Najib’s government, which had urged him to stop additional flights to help voters get back to home districts to vote on election day. Mr. Fernandes said the government had also pressured him to silence Rafidah Aziz, the chairwoman of his long-haul affiliate. She actively campaigned for 92- year-old Dr. Mahathir’s alliance and the man he intends to hand power to, Anwar Ibrahim. Mr. Anwar is currently jailed on what he says are trumped up sodomy charges and expects to be freed on Tuesday.

Mr. Najib couldn’t be reached for comment.

Ms. Rafidah defended Mr. Fernandes on Sunday, saying he had been “publicly crucified” for trying to protect the airline from any further pressure that could threaten shareholders or employees.

A person close to Mr. Fernandes said, “Tony badly misjudged the public mood.”

That is an assessment that the AirAsia chief executive shared. In his video, he said that he, too, embraces the idea of a new-look Malaysia that casts off the race-based politics of the past.

“I apologize once again for the pain and the hurt I caused,” he said in the video.

Mr. Fernandes’ attempts to dissociate himself from UMNO point to what could a sweeping realignment of how business works in Malaysia, especially for private companies that have to deal with regulators or with large, state-sector companies such as oil firm Petronas, power company Tenaga Nasional, or, in AirAsia’s case, Malaysia Airports Holdings.

“It’s important to be seen to be on the right side,” said James Chin, a Malaysian academic and director of the Asia Institute at the University of Tasmania in Australia.

Mr. Chin notes how business groups that rose to prominence during Dr. Mahathir’s first stint as prime minister from 1981 to 2003 might also play a more significant role. Among them are entrepreneur Syed Mokhtar Al-Bukhary’s business empire and businesses connected to Daim Zainuddin, a veteran businessman and technocrat who Dr. Mahathir appointed to a panel of advisers on Saturday. In Malaysia, political parties are financed solely by private donations, so commercial support is unusually important.

This commercial shift is being accelerated by the worsening situation facing Mr. Najib, political analysts said.

On Saturday, authorities issued a travel ban preventing Mr. Najib or his wife Rosmah Mansor from leaving the country. The new government is preparing to open a probe into a financial scandal a state investment fund which is already the subject of investigations in several other countries. U.S. authorities allege that at least $4.5 billion was misappropriated between 2009 and 2015, including $681 million allegedly received by Mr. Najib, whom lawsuits in the U.S. referred to as “Malaysian Official 1.”

Mr. Najib and the fund, 1Malaysia Development Bhd., have denied wrongdoing, and Malaysian investigations carried out during Mr. Najib’s premiership have cleared him. On Sunday, police cordoned off Mr. Najib’s Kuala Lumpur home.

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