As it continues its hibernation amid the COVID-19 pandemic, AirAsia's long-haul subsidiary AirAsia X reported a net-loss attributed to the downturn in aviation demand during the first quarter of the year.
According to release from the AirAsia Group, AirAsia X saw a 21% drop in revenue during the first quarter of 2020 compared to the same period in 2019. The airline saw RM924.1 million in revenue (~USD $218.5 million - RM1.17 billion in 2019).
Along with the drop in revenue, the airline also reported a 25% drop in passengers carried (1.41 million) compared to the same time period in 2019 (1.5 million). Due to the downturn in travel demand, the airline reported a 15% decrease in year-to-year seat capacity.
Combined with the drop of revenue and passengers served, AirAsia X reported its 1st quarter loss in 2020 to around RM549.7 million (USD $129.7 million).
Aside from operating cargo and limited flights, much of the AirAsia X fleet was grounded starting in April.
“In the beginning of 2020, the Company’s operating environment was aggravated by the COVID-19 outbreak. AirAsia X Malaysia scaled down flight frequency to all markets in several phases beginning with China in February,” said AirAsia X Group CEO Nadda Buranasiri. He added: “In mitigating the adverse effects from COVID-19, we have had to undertake the temporary hibernation of our fleet under AirAsia X Group, as AirAsia X Malaysia suspended all scheduled operations from 28 March 2020 onwards, while AirAsia X Thailand’s scheduled operations have been suspended from 16 March 2020.”
AirAsia X's Future Outlook
While AirAsia Group has seen the resumption of domestic flights by some of its subsidiaries, AirAsia X operations in Thailand and Malaysia are still grounded due to international travel restrictions.
The airline stated: “Despite having no clear visibility on the timing of recovery at this point in time, the Company remains confident that demand will pick up towards the end of 2020. In these turbulent times, AirAsia X has actively engaged with key stakeholders in the industry, including government ministries, agencies and partner destination countries to mitigate the impact from the temporary downturn in air traffic and prepare for when recovery comes. In the meantime the Group will maintain minimum connectivity during this period for essential cargo and charter flights.”
The airline continued to stress that it is currently working with its partners to reschedule payments and reduce costs.