Capital A in talks with major hotel chain to extend AirAsia brand into hospitality

KUALA LUMPUR (May 5): Capital A Bhd (KL:CAPITALA) is in talks with a major hotel chain to extend its AirAsia brand into the hospitality sector.

Capital A, which is looking to exit its Practice Note 17 status, said in a statement on Tuesday that it is currently finalising a licensing agreement for the venture that will be parked under AirAsia Next. No further details were disclosed. AirAsia Next is also finalising agreements to manage two additional brands within the group.

“AirAsia Next continues to serve as a strategic cornerstone for brand licensing, technology and ecosystem management,” the group said in a statement. AirAsia Next owns the AirAsia, AirAsia MOVE and Santan brands.

Budget hotel chain Tune Hotels, owned by Tan Sri Tony Fernandes and Datuk Kamarudin Meranun, operates independently under Tune Group.

Santan, the group’s F&B unit, recorded higher inflight transactions and stronger demand for pre-booked meals, despite lower flight capacity and operational disruptions during the first quarter of financial year 2026 (1Q2026).

AirAsia MOVE saw strong growth, with users up 23% year-on-year to 17.1 million, supported by higher installs and engagement.

Flight seats sold rose 4% year-on-year despite challenges. FlyBeyond declined year-on-year but improved quarter-on-quarter, while ancillary sales jumped 15% due to demand for add-ons. Stays grew slightly, helped by bundled deals.

Wano, its new business-to-business segment, grew strongly with seats sold up 16% year-on-year, driven by more agents and better distribution.

Overall, Capital A said that the 1Q2026 performance was “steady”. This comes as seasonal travel demand during Chinese New Year and Hari Raya provided a boost, although this was partly offset by geopolitical tensions in the Middle East and the typically softer Ramadan period.

Aside from AirAsia Next, Capital A also manages Asia Digital Engineering (ADE) — maintenance, repair and overhaul (MRO) services for aircraft — and Teleport — logistics and cargo services.

ADE maintained steady base maintenance in 1Q2026, averaging eight aircraft per month. It completed 25 checks, up 13% from the previous quarter, but total checks fell 4% year-on-year due to more time-intensive C-checks. Overall maintenance activity saw a slight year-on-year decline in base and line services. However, the workshop segment grew, with orders increasing 12% YoY, supported by higher fleet utilisation and ongoing operational recovery.

Teleport otherwise recorded “significant increase in operations”, thanks to rising e-commerce demand across the Asia-Pacific region. The logistics unit expanded volumes, particularly along Malaysia-China routes, leveraging its network of partner airlines and dedicated cargo capacity.

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