AirAsia X eyes expansion in China, Japan and South Korea

An analyst said the stock likely came under selling pressure after being overbought by investors.

KUALA LUMPUR: AirAsia X Bhd considers North Asia, namely, China, Japan, and South Korea, as its new market for growth, said AirAsia executive chairman and AirAsia X group CEO Datuk Kamarudin Meranun.

Due to the scarcity of resources, the long haul budget airline will also be rationalising its routes by reallocating some of the current Australian capacity to its other destinations next year.

“We have to be very selective of our routes, seeing that our aircraft is limited and we will only get more aircraft next year.

“Demand is starting to pick up from Thailand and Indonesia, and we believe that the next market of growth will be in North Asia.

“This explains why we are expanding in South Korea, Japan, and China,” Kamarudin said, adding that AirAsia X would only be cutting down on the frequencies of its flights, instead of discontinuing routes.

Kamarudin was speaking after the launch of AirAsia X’s launch of four times weekly direct flights from Kuala Lumpur to Jeju, South Korea.

AirAsia X CEO Benyamin Ismail targets to achieve a passenger load factor of 80% in 12 months’ time, for the Kuala Lumpur-Jeju route.

AirAsia is the only airline to operate direct flights to Jeju, from Kuala Lumpur, connecting the island with Malaysia, the rest of Asia, and beyond.

“South Korea is an important market and we have seen tremendous growth from our existing routes to Seoul and Busan, which will now be complemented by our new service to Jeju, saving our guests the hassle of domestic transit to the island province.

“This new route will provide additional annual capacity of over 150,000 and will be a significant boost to strengthen business and tourism ties between Malaysia and South Korea,” said Benyamin.

He added that Malaysia was the second largest tourist market in South Korea, after China.

An estimated two million passengers travel between South Korea and Malaysia each year.

The group has plans to increase flight frequencies to Seoul from 14 times weekly to 18 times weekly, beginning December.

Meanwhile, AirAsia X flight frequencies to Busan shall also be increased from four times a day to five times a day, beginning November.

The Kuala Lumpur-Jeju route shall commence on December 12, 2017, with promotional all-in fares from RM199 one-way.

The special promo of all-in fares from RM199 one way on standard seat and RM899 one-way on award winning Premium Flatbed will run from October 10 to October 15, for travel between December 12, 2017 and March 25, 2018, available for booking on airasia.com.

Jeju Island, also known as the “island of the gods”, is a beautiful volcanic island located 64 kilometres south of the Korean peninsular.

It is the country’s most popular holiday island, with more than 70% of visitors being domestic travellers seeking out what has become known as the “Hawaii of South Korea”.