THE opening of Tune Hotels Sdn Bhd’s (Tune. Hotels.com)’s first and flagship property in Malaysia’s capital city of Kuala Lumpur onApril 9, marked a new chapter in the low-costaccommodation scene, not just in Malaysiabut within the ASEAN region.
For Tune Hotels, touted as ASEAN’s first “no-frills” hotel chain, has promised travellers “a five-star sleeping experience at a one star price”, starting at an unbelievable rate of RM9.99++ (US$2.80), a price yet unseen in budget hotels in the region. Guests of the chain will stay in rooms with a “five-star” mattress, a “power shower”, air-conditioning, clean sheets, a high-quality duvet and thick high-grade towels. There will also be electronic-based key card system and closed circuit television surveillance in the hallways to ensure safety.
“We are not skimping on the bed, the shower, the security and cleanliness. Those things are going to be a five-star experience. We are just cutting out the unnecessary items,” said Tune Hotels’ director and cofounder, Dennis Melka, during the hotels’ online booking (www.tunehotels.com) launch on March 1.
Removing the “unnecessary” means the hotels will have no swimming pool, minibar, desk, sofa, television or wardrobe. They won’t be a kitchen either. There is however a café selling snacks and drinks and other basic necessities.
Tune Hotels is basing its pricing strategy on the LCC’s model. The chain is linked to low-cost carrier AirAsia as its CEO Datuk Tony Fernandes is also one of Tune Hotels’ co-founders. The hotels will offer rooms at rates from RM9.90 per night if bookings are madein advance and at non-peak times.
The average room rate will, however, be about RM59.90. The pricing is behind the group’s philosophy of providing very affordable hotel accommodation in strategic locations to both domestic and foreign tourists. In fact, the idea for low-cost hotels came from the experience of AirAsia travellers whofound hotel rooms expensive.
They want to spend less on hotels and more on shopping and other travel-related activities. And this is the market Tune Hotels will focus on, said Melka. According to Tune Hotels’ chief operating officer, Andy Song, the group’s game plan isto have 40 hotels across the region.
However, its emphasis is to operate fully in Malaysia before venturing out to neighbouring countries. The group has, to date, acquired four properties for a total of RM50 million. Each cost an estimated RM10 million while refurbishment will cost another RM10 million. Apart from its flagship hotel in Kuala Lumpur the company will open a hotel each in Penang, Kota Kinabalu (Sabah) and Kuching (Sarawak) by year-end. The company has also launched its first hotel in Johor’s Danga Bay in the newIskandar Development Region.
The 250- room hotel will be ready early next year. Tune Hotels has also identified properties in Bali, Bangkok and Siem Reap as sites for Tune Hotels to plant its flag in 2008.
In the long run, through leverage with its ties with the soon-to-be launched AirAsia X, Tune Hotels may develop hotels in longhauldestinations such as China and London.
The company is also in talks with Malaysia Airports Holdings Bhd to lease a parcel of land next to the Low-Cost Carrier Terminal in Sepang to develop a 250-room hotel for transit passengers. The hotel is expected to be ready next year. Tune Hotels sees itself playing an important role, hand in hand with AirAsia, in boosting tourism within Malaysia as wellas in the ASEAN region.
As AirAsia and its affiliate companies in Indonesia and Thailand bring travellers to its individual hubs Tune Hotels will ensure that there are ample, affordable rooms that meet the travellers’ requirements and standards. “Much like no-frills air travel has revolutionised Asia’s skies, Tune Hotels.Com is poised to radically change the economy and limited service hotel industry in Asia,” is how AirAsia’s Fernandes, in a nutshell, describes Tune Hotels’ role in the travel industry.
Tune Hotels Sdn Bhd, which owns Tune Hotels.Com’s assets, is 72 percent owned byTune Ventures Sdn Bhd.
The hotel group was incorporated last December with a paid-up capital of RM5.2 million. Tune Ventures also has another portfolio company, Tune Money. Com.
