Skift Take

This is probably a good business decision. Economy class fares from Asia to the United States and Europe are already low, because there's so much competition. The market probably doesn't need another entrant — at least for now. And who knows? Air Asia X might change its strategy at some point.

AirAsia X, Asia’s leading low cost long-haul airline, will not return to Europe nor will it fly to the U.S. West Coast soon, but will instead focus on Asia, its founder and CEO said Monday in a series of Tweets.

The announcement comes as a surprise, as top airline executives had strongly hinted for months they wanted to fly ultra long-haul routes — both to Europe and the United States. Western Europe probably would have come first, while expanding to the Continental U.S. was more of a long-term plan, executives had said.

In February, the executive in charge of Air Asia’s long-haul business, Datuk Kamarudin Meranun, told Skift the airline was “seriously looking” into resuming flights from Southeast Asia to London, while it was also exploring flying new routes from Japan to Los Angeles, San Francisco, and possibly Las Vegas. “We have interest in a lot of the cities on the West Coast,” he told Skift.

Among all the ultra long-haul routes under consideration, London always seemed the most likely, since AirAsia X had flown there before. The airline pulled out of London and Paris in early 2012, saying the aircraft it was flying — the four engined Airbus A340 — was not cost effective for the long flight from Kuala Lumpur. But executives had long said they wanted to return, at least to London, with a more appropriate aircraft. “The timing is right,” Meranun said in February.

However on Monday on Twitter, Air Asia founder Tony Fernandes said AirAsia X has decided not to fly ultra long-haul routes.

“We have decided that ultra long haul is not relevant now,” he said. “Won’t get seduced into price wars over London.”

For awhile, as AirAsia X teased its possible new routes, it seemed the airline soon might disrupt Asia-United States and Asia-Europe routes as Norwegian has done on transatlantic sectors. Like Norwegian, AirAsia X offers cheap base fares — as low as $99 one way on its Osaka Honolulu — but charges extra for nearly everything else.

At least for now, though, AirAsia X is choosing a safer route. Instead of flying aircraft for 12 or more hours, it will fly no more nine hours. The Osaka-Honolulu route, which AirAsia X will start flying on June 28, will stay — it’s only about nine hours — but for the most part, Fernandes said, “Our focus will be Asia.”

As recently as January, AirAsia X planned to lease two Boeing 777-300ERs so it could fly nonstop from Kuala Lumpur, according to CAPA, a respected airline industry analysis firm. But ultimately, Fernandes said the airline calculated Europe didn’t make sense.

“We let the full service guys fight it out over Europe,” he said. “Many of them bleeding so so much.”

Two other airlines, Malaysia Airlines and British Airways, fly nonstop from Kuala Lumpur to London. The flight time is about 13 hours, longer than most low cost airlines fly.

But in the February interview with Skift, Meranun AirAsia X’s CEO, said customers would fly in a tighter configuration to save money.

“If we are able to offer them a fare that is really, really attractive at the same time without reducing much of the services and comfort, I don’t think that would be a major issue to the customer,” he said. “To me, the driving force is fare, and whether you have a service that they want.”

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Tags: airasia, low-cost carriers, norwegian air, tony fernandes

Photo credit: An Air Asia X Airbus A330 taxis in Sydney. The airline will not fly longer than eight or nine hours, its founder said Monday. Aero Icarus / Flickr

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