Kuala Lumpur, July 5 - AirAsia has finalized, as reported yesterday by Aero-New Journal, a landmark memorandum of understanding (MoU) with Airbus to acquire up to 70 Airbus A321XLR aircraft, marking a significant step in its ongoing restructuring efforts and ambitious global expansion plans. The agreement, valued at approximately $12.25 billion (RM51.72 billion), includes a firm order for 50 A321XLR jets and options for an additional 20, with deliveries scheduled to begin in 2028 and extend through 2032. This deal, announced during Malaysian Prime Minister Anwar Ibrahim’s diplomatic visit to France, underscores AirAsia’s strategic pivot toward a more fuel-efficient, long-range fleet to strengthen its position in the competitive global aviation market.
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The A321XLR, the longest-range single-aisle aircraft in the industry, offers AirAsia the capability to operate non-stop flights to destinations previously inaccessible with its existing narrowbody fleet, which primarily consists of Airbus A320 and A330 aircraft. With a range of up to 4,700 nautical miles, the A321XLR enables the airline to connect secondary cities across Asia, Europe, the Middle East, and Central Asia, while maintaining its low-cost model. The aircraft’s fuel efficiency, boasting up to 20% lower fuel consumption per seat compared to the A321neo, aligns with AirAsia’s goals of reducing operational costs and improving environmental sustainability. This acquisition is expected to enhance fleet utilization, allowing the airline to adjust capacity to meet demand while lowering its carbon footprint.
The deal comes as AirAsia nears the completion of a financial restructuring process triggered by challenges faced during the COVID-19 pandemic, which led to its classification under Malaysia’s Practice Note 17 (PN17) financially distressed status. The airline, under the leadership of Capital A CEO Tony Fernandes, has been actively restructuring its order book, which includes a backlog of over 350 Airbus aircraft. Discussions with Airbus also involve potentially converting existing orders for A330 widebody jets to the A321XLR, reflecting a strategic shift toward a more flexible, narrowbody-focused fleet. Additionally, AirAsia is exploring the acquisition of smaller aircraft, such as the Airbus A220 or Embraer E2, to complement its regional operations.
This agreement is a cornerstone of AirAsia’s vision to become the world’s first low-cost narrowbody network carrier, with plans to transport 150 million passengers annually by 2030, reaching a cumulative total of 1.5 billion since its inception. The A321XLR will support the airline’s expansion from its hubs in Kuala Lumpur and Bangkok, targeting high-potential markets like China, India, and select European routes. Fernandes has also hinted at establishing a Gulf hub and resuming one-stop itineraries to North America, leveraging the A321XLR’s capabilities. To finance the order, AirAsia is pursuing bank leases, capital market funding, and a corporate bond issuance planned for October 2025. This strategic investment not only bolsters Malaysia’s ambition to become Asia’s leading aviation hub but also positions AirAsia as a formidable player in the global low-cost aviation landscape, ready to redefine long-haul travel accessibility.