The era of Asian LCCs outdoing each other with massive narrowbody orders is probably over for the foreseeable future, as digesting their current backlogs will be enough of a challenge.
The bulk of the proceeds from offering have been earmarked for working capital as AirAsia Group is still feeling the effects of the COVID-19 crisis with its AOCs in Indonesia and Thailand grounded again.
AirAsia Group has raised MYR336.5 million ($82 million) following the completion of a two-tiered private share placement, part of a broader plan to raise MYR2-2.5 billion to save the struggling LCC operator which has been battered by the pandemic.
AirAsia Group recorded a strong recovery in passenger volumes in the 2020 fourth quarter (Q4), notably in domestic carriage across Indonesia, the Philippines and Thailand.
The Tata group’s purchase of a larger holding in joint venture AirAsia India (AAI) could help spur consolidation in the Indian airline industry as it rebounds from the COVID-19 crisis.
The AirAsia Group reportedly is keeping just a small part of its Indian joint venture, ceding more control of the carrier to Indian conglomerate Tata Group.
AirAsia X, the long-haul subsidiary of LCC AirAsia, is looking to raise up to MYR500 million ($123 million) through a rights issue and offering stock to new investors.
The lure of Asia-Pacific market growth potential has spurred the region’s LCCs to dramatically inflate manufacturers’ narrowbody orderbooks in recent years.
AirAsia X is liquidating its Indonesian unit and has written down its 49% holding in Thai AirAsia X as the long-haul LCC struggles to pay for aircraft leases across all of its AOCs.
AirAsia Japan confirmed that it has ceased operation as of Oct. 5 after the COVID-19 crisis compounded the carrier’s challenges in the competitive Japanese LCC market.
AirAsia Japan’s shareholders are reportedly preparing to shut down the carrier, as the AirAsia Group focuses its attention on its Southeast Asian operations.
AirAsia is turning to its digital and e-commerce portfolio as an alternate revenue stream while the Malaysia-based LCC group’s network remains disrupted because of the COVID-19 pandemic.
AirAsia has restructured its engineering operations into a wholly owned subsidiary, which will provide MRO services to the group’s airlines and also third-party customers.
AirAsia is hoping to raise MYR2.5 billion ($602 million) by the end of the year while the fate of its Japanese operation is unclear after it was put under review.
AirAsia Group Berhad is preparing to rely on its six airlines’ domestic markets for revenue in the remaining months of 2020 after the LCC group had “stabilized” in the second quarter following the outbreak of COVID-19.
A new event is being launched by Routes which will provide an innovative platform for the aviation industry to rebuild air services in the post-pandemic era.
AirAsia has highlighted its efforts to raise new funds and cut costs as it seeks to reassure investors following an auditor’s report that questioned the carrier’s financial viability.
Trading of AirAsia Group Berhad stock was temporarily halted on the morning of July 8 after auditor Ernst & Young (EY) questioned the LCC’s ability to shore up its funds to stay afloat.
AirAsia Group has posted a net loss of MYR953.3 million ($223 million) for Q1 of 2020, the largest loss the company has recorded since its listing in 2004.
Southeast Asia’s largest LCC AirAsia Group is reportedly looking to sell 10% of its equity to South Korea’s SK Group to raise funds as the ongoing COVID-19 crisis impacts cashflow.
