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AirAsia rebuilds capacity in core Malaysian domestic market

Premium Analysis

For AirAsia there has been a welcome recovery in Malaysian domestic demand in the last part of 2021 as internal travel restrictions ease in the group’s most important market.

Third quarter operating statistics made fairly grim reading for AirAsia. The effects of the COVID-19 delta variant caused the governments in the group’s major Southeast Asian markets to impose limitations on domestic travel. This was particularly true in Malaysia and Thailand, where the AirAsia units based in those countries had to suspend most of their remaining operations.

In Malaysia, the number of new daily cases peaked at more than 600 in late Aug-2021, according to the Our World in Data website. However, the daily case count had fallen again to 173 by 24-Nov-2021.

At the same time, Malaysia’s vaccination rate continues to climb, with 76.3% of the population fully vaccinated as of 25-Nov-2021. The fully vaccinated rate for eligible adults is above 90%.

These two factors combined – daily case numbers and vaccination rate – prompted the government to lift many of its interstate travel restrictions in the fourth quarter.

For AirAsia, this means its Malaysian domestic operation can ramp up, which is important, given that the airline’s international operations remain largely halted.

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