AirAsia & MAS

The historic tie-up between AirAsia and Malaysia Airlines could be a precursor to unprecedented consolidation in the Asian airline market, according to the Sydney-based Centre for Asia Pacific Aviation.

In a special report issued following the announcement of the share-swap transaction ([Vous devez être inscrit et connecté pour voir ce lien]), CAPA said the deal would have been unthinkable just a few years ago and posited that "a move of this nature typically guarantees a host of flow-on impacts on the plans of other airlines and partnerships … Often there is no broad strategy behind each new move as the airlines react to local circumstances." At the same time, "other players are quick to re-assess the opportunities and whole new permutations arise."

CAPA said the deal "could prove more beneficial to MAS and invigorate the flag carrier," which has seen its stock price drop significantly over the last several months, reaching a nine-year low in May. It added that there is no evidence yet of a clear grand plan beyond a need for MAS to find another way ahead, noting that "the cultures of the two airlines remain very different and a total merger seems unlikely in the short term."

The report stated, "For AirAsia, the deal potentially opens a whole new world beyond its core market. Regulatory hurdles, which have always been AirAsia's biggest challenge to growth, will also be eliminated as AirAsia benefits from its new link with a government-owned investment firm."

CAPA sees significant ramifications from the AirAsia-MAS deal for Qantas and its low-cost subsidiary Jetstar. QF's recent tie-up with MAS, including sponsoring it for oneworld membership, is a component of the Australian airline's new international strategy, which will formally be unveiled Aug. 24, it noted. CAPA said the AirAsia/MAS cooperation also has "hugely significant ramifications for extensive cooperation between AirAsia and Jetstar well beyond the [back room support] agreement announced last year" ([Vous devez être inscrit et connecté pour voir ce lien]).