AirAsia X is on the verge of announcing the launch of Kuala Lumpur-Sydney service, after four years of extensive lobbying (Sydney Morning Herald, 14-Jan-2012). CEO Azran Osman-Rani said the carrier is hopeful of the launching the services but will ensure all the ground work has been done before confirming the launch, expected in Apr-2012, ahead of Scoot. ''Hopefully everything will come together and we will be able to … [launch] it quickly,'' he said. Mr Osman-Rani will visit Sydney this week to meet executives from Sydney Airport with the carrier to also reportedly planning to commence ticket sales on the route in the current week. Mr Osman-Rani said the launch of Scoot has put pressure on Malaysian regulators to approve the launch. ''When it came to Sydney, the thing that made a bigger difference was Scoot's announcement [that it will begin daily services between Singapore and Sydney in the middle of this year],'' he said. Malaysia's Transport Minister Kong Cha Ha stated the Ministry has "no objection to AirAsia X (on KL-Sydney route) or any local airlines". Malaysia Airlines is the sole carrier on the sector, according to Innovata data, after Jetstar withdrew from the route in 2009 (The Star/StarBiz, 12/13-Jan-2012). [more - CAPA Analysis]
AirAsia X on verge of announcing Kuala Lumpur-Sydney service launch from Apr-2012: reports
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However, market share gains will likely come at the expense of yields and profitability as competition with North Asian airlines – and to some extent US and Gulf carriers – intensifies. North Asian airlines now account for more than 50% of bookings in the Southeast Asia-US market and have increased their reliance on Southeast Asian connections as they have added US capacity, resulting in very competitive fares.
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The Australia-India market has experienced rapid growth over the last three years, prompting Australia to lobby for more direct services. Visitor arrivals from India are up 50% since mid-2013, and total passenger traffic between the two countries is up approximately 30%.
Air India launched services to Melbourne and Sydney in 2013 but the Australia-India market is still dominated by Southeast Asian flag carriers. Singapore Airlines has been able to maintain a leading 41% share of the market. Malaysia Airlines also still carries more Australia-India passengers than Air India.
Attracting more nonstop flights from Air India, or the possible launch of nonstop flights to India by Australian carriers, will not be easy despite growing demand. Southeast Asia’s network airlines have a competitive advantage as they serve several gateways in both Australia and India. Southeast Asia’s growing medium/long haul LCCs have also started to compete in the Australia-India market and are well positioned to take a large share of the anticipated growth.