Indonesia AirAsia X faces regulatory hurdles & delays but is finally cleared to launch Melbourne

Long-haul low-cost start-up Indonesia AirAsia X (IAAX) has adjusted its fleet expansion plan for 2015 and 2016 in response to unexpected regulatory challenges. IAAX has finally secured approvals to serve Australia, which it now plans to launch on 18-Mar-2015, but is still seeking to secure approvals from Japan and South Korea while new regulations in Indonesia also pose a potential roadblock.

IAAX initially planned to commence operations in Dec-2014 on the Bali-Melbourne route. An unexpected last second setback from the Australian regulator forced IAAX to postpone the Melbourne launch by three months.

IAAX ended up shifting gears and commenced operations in Jan-2015 with services to Taiwan, which has a more favourable regulatory environment. But the carrier has since been operating only one weekly flight to Taipei, resulting in an extremely low utilisation rate for its initial fleet of two 377-seat A330-300s. IAAX is now planning to add only one aircraft 2015 and one more aircraft in 2016 although this could change if the regulatory environment becomes more favourable.