AirAsia discontinues Japan operations, restructures long-haul unit
Malaysian budget airline AirAsia Group is pulling out of the Japanese market “with immediate effect” as the coronavirus pandemic has wiped out almost all travel demand globally.
AirAsia Japan has discontinued domestic routes between Chubu Centrair International Airport south of Nagoya and three destinations, Sapporo, Sendai and Fukuoka, on October 5. One international route to and from Taipei will stop operating on December 5.
AirAsia has become the first airline operating in Japan to close its business due to the virus outbreak. Most employees will be dismissed in November.
“We have concluded that it would be an extremely challenging feat for us to continue operating without any visibility and certainty of a post-pandemic recovery path,” said Jun Aida, chief operations officer of AirAsia Japan.
“This painful decision to cease operations was made neither in haste nor taken lightly,” he added.
However, Aida noted that AirAsia plans to retain its business license for Japan for the time being, but it remains to be seen if it will re-enter the Japanese market.
Debt refinancing at AirAsia X
Meanwhile, AirAsia Group long-haul arm AirAsia X said it will undergo a debt restructuring and share consolidation programme in an attempt to weather the aviation industry’s worst-ever crisis. The plans include a refinancing of about $15.3 billion in debt and the reduction of 90 per cent of the company’s capital, Bloomberg News cited from an exchange filing by the carrier to the Kuala Lumpur stock exchange on October 6.
“To avoid liquidation and to allow the airline to fly again, the only option is for AirAsia X to undertake a group-wide debt and corporate restructuring and update its business model to survive and thrive in the long term,” the filing said, adding that the company was currently “unable to meet its immediate debt and other financial commitments.”
In case of a successful overhaul of its finances, the carrier said it hopes to begin operating with two aircraft in selected markets in the first quarter of 2021 and gradually resume flights to all its destinations by end-2021.
Malaysian budget airline AirAsia Group is pulling out of the Japanese market “with immediate effect” as the coronavirus pandemic has wiped out almost all travel demand globally. AirAsia Japan has discontinued domestic routes between Chubu Centrair International Airport south of Nagoya and three destinations, Sapporo, Sendai and Fukuoka, on October 5. One international route to and from Taipei will stop operating on December 5. AirAsia has become the first airline operating in Japan to close its business due to the virus outbreak. Most employees will be dismissed in November. “We have concluded that it would be an extremely challenging feat...
Malaysian budget airline AirAsia Group is pulling out of the Japanese market “with immediate effect” as the coronavirus pandemic has wiped out almost all travel demand globally.
AirAsia Japan has discontinued domestic routes between Chubu Centrair International Airport south of Nagoya and three destinations, Sapporo, Sendai and Fukuoka, on October 5. One international route to and from Taipei will stop operating on December 5.
AirAsia has become the first airline operating in Japan to close its business due to the virus outbreak. Most employees will be dismissed in November.
“We have concluded that it would be an extremely challenging feat for us to continue operating without any visibility and certainty of a post-pandemic recovery path,” said Jun Aida, chief operations officer of AirAsia Japan.
“This painful decision to cease operations was made neither in haste nor taken lightly,” he added.
However, Aida noted that AirAsia plans to retain its business license for Japan for the time being, but it remains to be seen if it will re-enter the Japanese market.
Debt refinancing at AirAsia X
Meanwhile, AirAsia Group long-haul arm AirAsia X said it will undergo a debt restructuring and share consolidation programme in an attempt to weather the aviation industry’s worst-ever crisis. The plans include a refinancing of about $15.3 billion in debt and the reduction of 90 per cent of the company’s capital, Bloomberg News cited from an exchange filing by the carrier to the Kuala Lumpur stock exchange on October 6.
“To avoid liquidation and to allow the airline to fly again, the only option is for AirAsia X to undertake a group-wide debt and corporate restructuring and update its business model to survive and thrive in the long term,” the filing said, adding that the company was currently “unable to meet its immediate debt and other financial commitments.”
In case of a successful overhaul of its finances, the carrier said it hopes to begin operating with two aircraft in selected markets in the first quarter of 2021 and gradually resume flights to all its destinations by end-2021.
