Asian airlines fly nervously into post-COVID future

"Just another chapter in that never-ending story of AirAsia" was how Tony Fernandes, the Malaysian tycoon who heads Asia's largest budget carrier, described this year of struggle. On Dec. 9, Fernandes remained aggressive about his company's plans. "We feel we're going to come back stronger in 2021," he said. But there was less optimism about his joint venture airline in India with the conglomerate Tata Group. "[India is a] competitive market, tough for outsiders to come in. ... Let's know where we're strong. If things don't feel right, then we look at other options," Fernandes said. "Obviously we've exited Japan because we were too small, and COVID put final nails in that coffin. ... Whether we should put money to continue in India or to expand in ASEAN, that's a discussion I'm having." Indeed on Dec. 29 AirAsia Group said it would sell 32.67% of its stake in its Indian operations to Tata for $37.7m. AirAsia previously decided to pull out of Japan, where its joint venture subsidiary filed for bankruptcy in November. Such retreats by Fernandes, an industry innovator, are a barometer of how much turmoil Asia's airlines have faced as COVID-19 triggers a restructuring of the market -- spelling financial difficulties and even failure for some well-known brands. Globally some 2.6b fewer seats were provided this year than last year. Passenger traffic was down 67% this year from 2019 and was on a par with 1999 levels. South Korea's Korean Air and Asiana Airlines are already moving to consolidate via a merger brokered with support from Seoul. Industry experts believe other Asian players will likely be forced to follow suit in a region that was suffering from surplus capacity even before the pandemic. Story has more.<br/>