Malaysia’s top low-cost airline, AirAsia, has today reported a second-quarter loss marking a fourth straight quarterly loss for the Kuala Lumpur-based airline. As expected with the current COVID-19 global pandemic decimating airlines worldwide, AirAsia reported a net loss for the April-June quarter of 993 million ringgit ($238 million). This figure compares to a net profit of 17.3 million ringgit ($4.15 million) reported for the same period in 2019.
With the coronavirus pandemic causing several border closures to AirAsia destinations, the LCC moved its Malaysia and Philippines fleets into storage in March. While taking planes out of service, it also cut back on its flights in Indonesia. When commenting on the moves, Reuters quotes the airline with saying the following:
“The reduction of group expenditure could not offset the decrease in revenue as passenger demand collapsed due to the widespread border closures and certain onerous travel restrictions.”
Passenger numbers were down 98%
During the three months that AirAsia has just reported, it carried a total of 204,082 passengers with a load factor of 59%, which resulted in a drop of passenger numbers of 98% compared to a year earlier. To help it weather the current downturn in demand, AirAsia has applied for loans in the markets in which it operates. It has also received proposals from investment bankers and other lenders in a bid to raise capital.
“Barring any reversal of flight resumption plans and any major shock to demand, we foresee that we have sufficient working capital to sustain business operations,” it said.
AirAsia planed to resume Bali flights
In other AirAsia news, the budget carrier said today that it plans to
reopen four of its routes from Bali starting Sept 1. The routes from Bali include flights to Labuan Bajo in East Nusa Tenggara, Lombok in West Nusa Tenggara, as well as Yogyakarta and Surakarta in Central Java.
According to a press release carried by the Jakarta Post, the move is a part of the airline’s efforts to reopen its popular routes gradually. AirAsia Indonesia president Veranita Yosephine Sinaga said in the statement:
“We continue to work hard to gradually normalize the operations of our customers’ favorite routes, starting with our Bali hub.”
Bali will not allow foreigners until 2021
AirAsia decided to reopen it’s Bali routes after the Balinese authorities announced that the popular tourist island we be open to tourists starting in September. Bali relies heavily on tourism and has seen it’s economy walloped by the need to keep foreign tourists away.
What AirAsia did not know when they announced the resumption of routes was that Indonesia would see an increase in COVID-19 cases and do a u-turn. According to reports from the BBC, foreign tourists will not be allowed to visit Bali until at least the end of the year.
“The situation in Indonesia is not conducive to allow international tourists to visit the country, including Bali,” said the island’s governor, Wayan Koster, in a recent statement seen by the BBC.
While the statement did not specify when Bali would reopen to travelers, it did say that Indonesia would not be open to international tourists “until the end of 2020.”
This is yet just another reason why airlines are having such a hard time making plans. For the traveling public too, it is impossible to book an international flight as the rules can change at any time.
What do you think about flying internationally right now? Please let us know your thoughts in the comments.
