AirAsia Aviation Group, part of Capital A Bhd Group, has signed a joint venture agreement with Sivilai Asia to establish a new subsidiary in Cambodia, which is due to be launched by the end of 2023.

AirAsia Cambodia will be the newest low cost venture for AirAsia, which is already present in Malaysia, Indonesia, Thailand and the Philippines. The future AirAsia affiliate will join an already crowded market with half a dozen carriers registered in Cambodia.

The new airline will further cement AirAsia’s brand in Cambodia and Indochina, providing the group with greater access to its domestic market and most importantly connecting it to the international markets across Asean, North Asia and beyond. The new airline will allow the aviation group to build scale, network connectivity and further reduce the cost of operations.

AirAsia Cambodia aims to further stimulate the country’s aviation and tourism industries, launch new destinations, create jobs and bring a true low cost operation to the region.

The joint-venture was signed in December by Tony Fernandes, CEO of Capital A and Vissoth Nam, director of Sivilai Asia at Rosewood Phnom Penh in the presence of Mao Havannal, Minister in Charge of State Secretariat of Civil Aviation. Subject to obtaining the relevant regulatory approvals, the JV is expected to commence operations in late 2023.

Tony Fernandes, CEO of Capital A, said: “Capital A continues to focus on Asean where we know best and our brand is the strongest. Cambodia is the fifth Asean country where we are continuing our march of being the region’s number one mover of people and cargo, and providing a linchpin of economic growth for Asean countries. The value of AirAsia’s network is an insurmountable asset.”

“We are confident of profitability in the first year as Cambodia is a market that is familiar to us and where we have deep infrastructure in place. That is why all our future airlines will be based in Asean. As this is an area we know well and can derive quick profitability and connect our very large network to the main points of Cambodia, namely Phnom Penh, Siem Reap and Sihanoukville,” he added.

AirAsia: Cambodia’s second largest foreign airline group

The AirAsia Group is already the second largest airline group overall operating into Cambodia in terms of capacity. Pre-pandemic, AirAsia operated 90 weekly flights from Malaysia and Thailand and is currently operating about 49 weekly flights to Cambodia. The various affiliates of AirAsia Group operate five routes to Cambodia from both Kuala Lumpur and Bangkok Don Mueang to Siem Reap and Phnom Penh. AirAsia will launch on January 23 a new route connecting Penang to Phnom Penh.

Since entering the Cambodian market in 2005, AirAsia has carried over 10 million guests to and from the country.

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