Perhaps it’s all those outrageous baggage and other random fees where AirAsia’s making its money? Investors have often looked askance at AirAsia’s leasing business, particularly because many of its sale-and-leasebacks have been not to lessors but to its own affiliates in Indonesia, Thailand, the Philippines and India. AirAsia’s profits have been relying more heavily on ancillary and baggage revenues in recent quarters in preparation for this change. But that ultimately means driving up costs to customers, which will weaken AirAsia’s ability to undercut its rivals. With an arm’s-length leasing business, it’ll just become one of half-a-dozen smaller customers again.

Source: Mint November 25, 2016 07:09 UTC