Govt has made no commitment to financial support for AirAsia, says MOF

Tuesday 20 Oct 2026

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KUALA LUMPUR (Oct 19): The Ministry of Finance (MOF) said on Monday that the government has not made any commitment to provide financial support to AirAsia Group Bhd (KL:AAGB), whether through guarantees, loans or public fund injections.

In a written parliamentary reply, the ministry said it would not comment on media speculation or reported figures to avoid affecting the market and the interests of employees, customers and other stakeholders.

Any request for assistance from companies in any sector would be assessed based on national and public interests, fiscal sustainability and the protection of public funds, in accordance with prevailing laws and procedures, it said.

The MOF was responding to Ayer Hitam MP Datuk Seri Dr Wee Ka Siong, who asked whether the government was considering providing guarantees, loans or public fund injections to AirAsia.

AirAsia has been facing financial challenges and is reportedly seeking fresh funding to counter headwinds from rising jet fuel prices and foreign exchange losses.

The Edge Malaysia reported on Oct 1, citing sources, that the fundraising effort was backed by the MOF. The ministry was said to be helping Alton Aviation Consultancy, which is advising the group on raising up to US$1 billion (RM4.1 billion), to attract lenders and investors.

AirAsia, which employs about 17,000 people regionally, saw its net loss widen to RM527.16 million for the second quarter ended June 30, 2026, from RM154.88 million in the preceding quarter, as revenue fell 14.5% to RM5.09 billion.

As of June 30, the group had net debt of RM2.27 billion, with cash reserves of RM953.67 million against total borrowings of RM3.13 billion. Of the borrowings, RM803.2 million was due within 12 months. The group also had RM13.3 billion in lease liabilities.

The MOF acknowledged concerns over AirAsia’s financial difficulties, which the airline has attributed mainly to a sharp rise in jet fuel prices following the conflict in West Asia.

The government was monitoring developments in the domestic aviation sector, including the impact of the conflict in West Asia, global fuel prices and currency movements on airlines and air connectivity, it said.

As part of its monitoring efforts, the government regularly engages with players in the aviation ecosystem and seeks input from industry players, technical experts and other stakeholders, as it does for other economic sectors affected by the crisis in West Asia, the MOF said.

The MOF also highlighted AirAsia’s significant role in the country’s aviation sector. The airline accounted for about 41% of the 104.5 million passenger movements recorded at airports operated by Malaysia Airports Holdings Bhd (MAHB) in 2025, and nearly 60% of domestic passenger movements.

The low-cost carrier also plays a significant role in maintaining air connectivity in Sabah and Sarawak, carrying 62% and 70% of total passengers in the respective states in 2025, excluding short take-off and landing (STOL) ports.

AirAsia accounted for the highest share of passenger movements in Sibu (79%), Bintulu (77%), Sandakan (75%), Kuching (72%), Tawau (70%), Miri (63%) and Kota Kinabalu (62%).

In Peninsular Malaysia, the airline also recorded high passenger shares in Johor at 70%, Terengganu at 56%, Langkawi at 56%, Alor Setar at 49% and Kelantan at 46%. At Kuala Lumpur International Airport Terminal 2 (klia2), AirAsia accounted for three-quarters of total passenger movements.

The MOF said the government would continue to monitor developments closely, with the interests of the public remaining its priority.

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Edited ByPresenna Nambiar

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