AirAsia Drops A330neo, Pursues Massive A220 Deal
Kuala Lumpur, Malaysia — AirAsia X co-founder Tony Fernandes confirmed on Tuesday that the Malaysian low-cost carrier group plans to place a substantial order for smaller regional aircraft within the coming weeks, while formally abandoning its last 15 Airbus A330neo widebody jets still sitting on the books.
Speaking to Reuters on the sidelines of a Bahrain hub announcement, Fernandes said the airline is weighing proposals from both Airbus and Embraer for regional-class aircraft and that the final selection would come within a month. He added that the deal would be larger than industry observers have so far reported. Multiple sources familiar with the discussions have indicated AirAsia could commit to as many as 150 Airbus A220 narrowbodies, which would represent one of the largest single orders ever placed for the type.
The competition between the two manufacturers has been running since mid-2025, when AirAsia first publicly acknowledged it was in the market for a smaller-gauge aircraft to complement its dominant A320 family fleet. At last year’s Paris Air Show, Fernandes confirmed talks were underway but declined to name a preferred supplier. Bloomberg reported in late January that terms had been largely agreed with Airbus for roughly 100 firm A220s, with the possibility of additional options pushing the total toward 150 units.
Embraer’s E2 family remains in contention, though. The Brazilian manufacturer has been aggressively marketing its E195-E2 across Southeast Asia, where thin route density and secondary airport constraints favor aircraft in the 100-to-150-seat class. Airbus, for its part, holds a natural advantage given AirAsia’s all-Airbus operational history, which simplifies pilot training, maintenance logistics, and spare parts management. Financing terms are understood to be a decisive factor in the final selection.
The decision to drop the remaining 15 A330neo aircraft marks the quiet end of what was once the program’s largest customer relationship. AirAsia X originally committed to 50 A330-900s in 2014 as the type’s launch buyer, later expanding the order to as many as 100 units at the 2018 Farnborough Airshow. The pandemic and a subsequent financial restructuring forced the carrier to slash 63 frames from its backlog in early 2022, leaving just 15 on the books. None were ever delivered.
In October 2025, Fernandes told reporters the group intended to phase out its existing A330-300 widebody fleet within five to six years and transition to an all-narrowbody operation. That strategy now appears firmly locked in. Capital A completed the transfer of its short-haul AirAsia aviation units to AirAsia X in January, consolidating seven airline certificates under a single structure with a stated ambition to become the world’s first narrowbody low-cost network carrier.
The A220 or E2 acquisition would slot neatly into that vision. Both aircraft types offer seat counts between 100 and 160 passengers, well below the A320neo’s typical 180-seat low-cost configuration but ideal for thinner routes connecting secondary cities across Southeast Asia’s fragmented geography. For a carrier built on the premise of democratizing air travel, the ability to profitably serve smaller markets that can’t fill a larger narrowbody represents a potentially significant growth vector.
AirAsia X already secured 50 firm A321XLR orders with 20 options last July, giving it extended-range narrowbody capability for medium-haul routes up to 4,700 nautical miles. Combined with a prospective A220 fleet, the group would hold a diversified narrowbody portfolio spanning regional feeder services through to intercontinental operations — all without widebody aircraft.
Tuesday’s fleet announcement came alongside a separate strategic milestone. AirAsia X formally designated Bahrain as its first hub outside of Asia, with plans to launch Kuala Lumpur-Bahrain-London Gatwick A330 services beginning in June. The Bahrain positioning follows a letter of intent signed with the kingdom’s transportation ministry in November 2025 and envisions more than 25 daily flights between Bahrain and ASEAN megahubs by 2030, potentially carrying over 20 million passengers across the five-year period. The group is also studying the establishment of a Bahrain-based air operator’s certificate, which would allow it to fly within the wider Middle East, Central Asia, and Africa.
Group CEO Bo Lingam described the Bahrain move as part of AirAsia X’s transformation into a globally connected airline, supported by a secured order book of 374 aircraft and a five-year growth plan emphasizing disciplined fleet expansion and digital initiatives.
The fleet pivot from widebodies to a diverse narrowbody stable carries execution risk. AirAsia’s PN17 financially distressed classification on Bursa Malaysia, while expected to be resolved, underscores the balance sheet pressures that come with ambitious fleet commitments. Airbus A220 production rates have been climbing but remain constrained, and delivery timelines for a 100-plus aircraft order could stretch well into the next decade.
Still, the strategic logic is difficult to dispute. Southeast Asia’s air travel market continues to expand rapidly, driven by rising middle-class populations and first-time flyers across Indonesia, the Philippines, Vietnam, and beyond. Reaching those passengers on routes where a 180-seat aircraft simply doesn’t fill up demands a different tool in the fleet. Whether that tool carries an Airbus or Embraer badge is the question Fernandes says he’ll answer within weeks.
Photo Credit: David Syphers
This article was produced in accordance with our editorial standards. Aviantics maintains strict editorial independence.
