AirAsia X slows fleet expansion, seeking a 2H2015 turnaround. Could AirAsia buy its half-sister?

AirAsia X is further slowing growth as the long-haul low-cost group battles challenging market conditions. AirAsia X's fleet is now slated to only grow by three aircraft over the next three years, leading to a much slower than anticipated build up for its new affiliates in Indonesia and Thailand.

AirAsia X has now been in the red for seven consecutive quarters, accumulating net losses of USD270 million including USD36 million in 2Q2015. The group has been in restructuring mode since late 2014, leading to a 20% drop in passenger traffic in 2Q2015.

Unfavourable market conditions and unexpected external factors have delayed a hoped for turnaround. But AirAsia X is confident it will be back in the black in 2H2015, boosted by capacity cuts at Malaysia Airlines; any new unforeseen external factors could however be painful.