A bullish AirAsia Aviation Group expects to surpass pre-pandemic capacity to Mainland China by the year-end, with its Malaysian and Thai units leading the ramp-up in the coming months.
In briefing slides accompanying its fourth-quarter financial results, AirAsia Aviation says it expects to restore about 90% of Mainland China capacity – or about 290 weekly flights – across its units by August this year. The figure is a significant jump from the current 67 weekly flights to China.
By November, Chinese capacity will be 11% higher than pre-pandemic levels in 2019, or 363 weekly flights.
AirAsia Malaysia is expected to fly to 13 points in China, including Beijing, Changsha, Wuhan, Shenzhen and Guangzhou. Thai AirAsia, meanwhile, will fly to 12 cities.
Indonesia AirAsia will also make its debut in the Chinese market, with flights to Shenzhen expected to commence this year.
Tony Fernandes, CEO of AirAsia Aviation parent Capital A, says: “For our aviation business, China’s reopening will further boost the group’s recovery as we return to one of our key markets.”
The optimistic outlook on China comes as the airline group swings back to profitability in the fourth quarter of 2022, on the back of a surge in international travel demand.
For the three months to 31 December 2022, AirAsia Aviation posted a positive EBITDA of MYR598 million ($133 million), reversing the MYR254 million loss in the year-ago period.
Revenue for the quarter rose more than four-fold to MYR2.1 billion, with AirAsia Aviation noting an “upsurge of domestic and international travels”.
The airline business carried about 7.8 million passengers in the quarter, more than twice the number reported in the year-ago period. Traffic and capacity for the period both tripled year on year.
Parent company Capital A also swung back to the black, posting a profit after tax of MYR172 million, against last year’s MYR915 million loss.
“The breakthrough quarterly performance was primarily driven by the aviation business segment – returning aircraft and opening up of key markets, as travel demand continues recovering in Asia alongside rising yield,” says Capital A.