Industry, Markets

AirAsia stepping up in china after agreeing a new joint-venture

According to latest report, Budget airline AirAsia has agreed a joint venture to set up a new low-priced airline in China.

This step is taken in line with the surging demand in the country, which is set to leave behind the US to become the world’s largest aviation market within the next ten years time.

The Zhengzhou-based airline will be run in partnership with the Everbright Group.

AirAsia already has operations in Malaysia, Thailand, Indonesia, Japan, Philippines and India.

“This Chinese venture represents the final piece of the AirAsia puzzle,” said chief executive Tony Fernandes, adding it “closes the loop” in the region.

There was a time when only privileged people were able to fly domestically within China but now the trend has changed and the market has boomed in the recent decade. Civil Aviation Administration of China numbers suggest that in 1982 there were less than four million air passenger journeys within the country. By 2016, that number had hit 487 million.

Meanwhile AirAsia said that on top of running the airline, it would invest in aviation infrastructure and will make an academy to train pilots, crew and engineers. The company said that there would also be new facilities to service and uphold aircraft in Zhengzhou, the capital of Henan province.

Furthermore AirAsia already is operating in China, flying to 15 destinations there, making it the country’s largest foreign budget airline.

“China has been good to us and we want to give back in a big way, and this is just the start of an enduring partnership that will benefit both China and Malaysia,” said AirAsia executive chairman Kamarudin Meranun.

The air-carrier had “started exploring” the prospect of eventually buying Chinese-made planes which are currently in development, he added.

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