AirAsia Group shut down its operations in Japan with immediate effect. The
Malaysian low-cost airline AirAsia Group Berhad, announced that it will be ceasing its operations in Japan. The cessation was filed by the company to Bursa Malaysia today on 5 October 2020.
The airline said it has been notified that the board of directors for AirAsia Japan (AAJ) have taken a decision to cease operations in the country with immediate effect. “We respect and have agreed to the decision made by AAJ as this would reduce the cash burn of AAJ and the Company amid the highly challenging operating conditions in Japan which have been aggravated by the COVID-19 pandemic that has plagued the world since early this year,” AirAsia wrote in the filing.
According to a report by Asian Aviation, representative director and COO Jun Aida said that AAJ has concluded that it would be a challenging feat to continue operating without any visibility and certainty of a post-pandemic recovery path. He added that the decision of cessation was agreed upon by the board after a thorough business review was conducted.
The cessation only affects the domestic and international flights operated by AAJ within the country and does not affect flights going in or out of Japan operated by other airlines within the AirAsia Group. AAJ has cancelled all flights and have contacted affected guests via email with further information.
Its majority-owned subsidiary AirAsia Japan (AAJ) is not financially strong enough to continue its operations under “extremely challenging operating conditions” which were caused by the COVID-19 pandemic.
AAJ is the smallest airline-unit of AirAsia Group. Was incorporated into the group in 2014. Since then, it has been operating domestic and international flights with three Airbus A320 on its fleet from its base in the Chubu Centrair International Airport (NGO) in Nagoya, central Japan.
“Despite our unrelenting efforts to sustain operations through successive and wide-ranging cost reduction initiatives, we have concluded that it would be an extremely challenging feat for us to continue operating without any visibility and certainty of a post-pandemic recovery path,” Jun Aida, the Representative Director and COO of AAJ, announced in a press release.
“Further steps to this decision will be made in accordance with the applicable laws and regulations including the Japan Civil Aeronautics Act,“ added Aida.
AirAsia Group informed that the closure of AAJ operations would not have any impact on the other group air carriers’ operations in Japan.