AirAsia sees domestic routes as key to stabilization

AirAsia Group said domestic markets will be its focus for the remaining months of 2020, with short-haul demand rebounding in the countries it serves.

Already at 45% of 2019 levels, flagship carrier AirAsia Malaysia wants to recover its domestic capacity to 70-75% by the fourth quarter. AirAsia Thailand's domestic capacity will return to pre-COVID levels by year’s end, recovering from its 75% level now, the group said. AirAsia Philippines and AirAsia Indonesia are targeting 60% and 35% of normal capacity, respectively.

The group said it has axed unprofitable routes and believes the fare environment will improve with more rational pricing from competitors.

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It also lowered maintenance costs in the second quarter by 93% year-over-year to MYR23.3 million ($5.6 million) by deploying newer aircraft that are further away from major maintenance milestones.

The group posted a net loss of MYR1.2 billion for the second quarter.

Photo credit: Nigel Howarth / Aviation Week

Chen Chuanren

Chen Chuanren is the Southeast Asia and China Editor for the Aviation Week Network’s (AWN) Air Transport World (ATW) and the Asia-Pacific Defense Correspondent for AWN, joining the team in 2017.