AirAsia cancels plan for Singapore operation

MALAYSIA-based low-cost carrier (LCC) AirAsia has terminated its plans to set up an airline in Singapore due to high costs and weak market potential, reported The Wall Street Journal last night.

AirAsia CEO Tony Fernandes said in an email to the newspaper: “We are concentrating on markets which have big domestic markets and big populations that are more liberal and market-oriented.

“(It is) very clear that we are in the right markets and capital should go into those countries to maximise returns.”

AirAsia, allegedly the region’s largest budget carrier by market share, has local operations in the Philippines, Japan, Thailand and Indonesia.

According to The Wall Street Journal, AirAsia had been keen to gain a foothold in Singapore to go neck-and-neck with LCC rivals Jetstar and Tiger Airways.

Although currently the “biggest LCC by number of flights to Singapore”, having a local setup locally would have allowed it to launch more flights from the city-state.

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