It's AirAsia versus everyone in Indonesia’s aviation dogfight

Low-cost carrier AirAsia has severed ties with a vital sales channel in Indonesia—online ticketing platforms. The circumstances that led to this hold lessons for other Southeast Asian airlines

Despite the rich potential of Southeast Asia’s aviation industry, airlines in the region are struggling with profitability

In Indonesia, the cut throat aviation space has seen national carrier Garuda and low-cost airline Lion try and push competitor AirAsia to the fringes

Garuda and Lion have made a pact to raise ticket prices, even convincing Traveloka, the nation’s largest OTA, to shun AirAsia for undercutting them on price

In response, AirAsia has gone off OTAs altogether, focusing its efforts on improving its digital capabilities instead

Sometime around February this year, Malaysian budget airline AirAsia’s flights on routes within Indonesia began vanishing sporadically from Indonesia’s largest online travel agent (OTA), Traveloka. Instead, the platform’s users had to manually check AirAsia’s website or app to see if the airline had better options.

This was no oversight or technical glitch. Or at least, that’s what AirAsia alleged. In March, the carrier, owned by eclectic Malaysian businessman Tony Fernandes, declared it would permanently withdraw all of its flights from Traveloka, Indonesia’s biggest OTA, because it felt unfairly treated by the platform.

AUTHOR

Nadine Freischlad

Nadine is based in Jakarta. She likes stories that capture the impact of digital transformation in Indonesia, with a special fondness for "clicks and bricks" businesses and platform economics. Previous stints with Tech In Asia, KrASIA, bylines in VICE, SCMP, CNN.

View Full Profile

Others tell you what. We tell you the ‘So What?’

Read articles that decode the most significant shifts happening around business, technology, startups and healthcare. 1000+ articles for subscribers of the India edition. 150+ articles for subscribers of the Southeast Asia edition. Plus premium newsletters that help you make sense of the world around you.

So much journalism in India is superficial.

Articles are generic, almost cookie-cutter in their approach. And they don’t provide enough context on the issues they cover. The Ken is different. I don’t always agree with everything they say but I appreciate their commitment to publishing deeply reported narratives and investigations. Their reporters find new ways to analyze tech among other industries. And that’s always worth a read.

Sid Talwar / Co-Founder and Partner / Lightbox Venture Capital

As entrepreneurs, we thrive on being in the know at all times.

A personal subscription to The Ken was a no brainer. But as startup founders, this isn't enough. Team members also need to be in the know, for everyone handles customer-facing responsibilities and an ecosystem change that impacts customers also impacts us

Kiran Jonnalagadda / Co-founder / HasGeek and Internet Freedom Foundation