Why AirAsia doesn’t need a new affiliate in Singapore, the rest of ASEAN and potentially all of Asia

The AirAsia Group has started focusing on growth at its existing portfolio of carriers after determining there is no need for additional affiliates in ASEAN and potentially in the rest of Asia. After spending the last several years actively searching for new joint venture partners, AirAsia has realised that most Asian markets where it does not yet have a local affiliate can be sufficiently covered by its existing carriers. The only possible short-term exception is India, but AirAsia remains wary of entering the Indian market and India has been the only Asian market where the group has reduced capacity over the last year.

Asia's leading low-cost carrier group will spend most of 2013 growing domestically in its five home markets and expanding international services to some strategic non-home markets, particularly mainland China. But expansion in AirAsia's largest non-home market, Singapore, will be slowed significantly. Congestion in Singapore - more so than the saturation of Singapore's LCC market - is prompting AirAsia to focus more on other non-home markets.