The combination of growing international travel demand, cheap oil, and easy access to capital drove a boom in long-haul budget airlines during the past decade. AirAsia X was one of the biggest, flying mostly to destinations around Asia from airports in Southeast Asia.
However, these long-haul, low-cost carriers have struggled to make money. Many have folded or required radical debt restructuring in recent years. The COVID-19 pandemic is finishing off those that remain. AirAsia X is now demanding that creditors take huge losses to avoid an outright liquidation. No matter how these restructuring talks play out, it will be bad for Airbus (OTC: EADSY) and its A330neo family of wide-body jets — and may provide opportunities for bargain-seeking airlines like Delta Air Lines (NYSE: DAL).
All-out collapse at AirAsia X
AirAsia X is the medium- and long-haul affiliate of AirAsia, one of the biggest ultra-low-cost carriers in the world.