AirAsia Japan’s shareholders are reportedly preparing to shut down the carrier, as the AirAsia Group focuses its attention on its Southeast Asian operations.

The Japanese LCC is expected to announce the shutdown early next week, according to a report from Japanese business news outlet Nikkei and others. The AirAsia board has approved the move, and Japanese officials have been informed, the reports said.

The AirAsia Group has not confirmed this news. “We have a strict policy of not commenting on rumors or speculation … there is nothing to announce at this time,” a spokesperson for the group said.

AirAsia holds a 66.9% equity stake in AirAsia Japan and 33% of the voting rights. Other major shareholders include Japanese online retailer Rakuten.

The joint venture was launched in 2017 but has yet to make a profit. The COVID-19 crisis further hurt earnings, with AirAsia Japan reporting a net loss of ¥1.1 billion ($10.4 million) for the quarter ending June 30. The carrier temporarily suspended its operations because of the pandemic, resuming flights on Aug. 1.

AirAsia Japan operates three Airbus A320s. The LCC market in Japan has become extremely competitive in recent years following the establishment of new carriers, either owned by major airline groups or independent.