AirAsia/AirAsia X merger a logical step that would better align operations

Premium Analysis

The proposed merger of the AirAsia short haul brands with the widebody airline AirAsia X (AAX) would bring the AirAsia Group more into line with other major Asia-Pacific LCCs that operate both widebodies and narrowbodies in a single airline.

While AirAsia and AAX are sister companies with common ownership and operational links, they are still separate entities. This arrangement contrasts with LCCs such as Scoot, Jetstar, VietJet, Jin Air and Cebu Pacific, which have mixed fleets within the same airline.

Widebody LCCs are more financially viable when they also have a short haul narrowbody feeder network.

The AirAsia/AAX move would therefore be a beneficial step for AAX, as it would allow much tighter integration with its short haul sister airlines.

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