This article summarizes reporting by The Star.

MAG Signals Potential Sale of Firefly Amid Continued Losses

Airlines Aviation Group (MAG), the parent company of Malaysia Airlines, has publicly acknowledged that divesting its loss-making subsidiary, Firefly, remains a strategic option. According to reporting by The Star, the group has set a timeline of approximately three to four years to determine the carrier’s fate, with a final decision expected around 2028 or 2029.

The potential sale is part of considerations under MAG’s newly unveiled “Long-Term Business Plan 3.0” (LTBP3.0), which covers the period from 2026 to 2030. While the parent group has secured three consecutive years of profitability, Firefly has struggled to contribute positively to the bottom line. Group Managing Director Datuk Captain Izham Ismail confirmed on December 15, 2025, that while no immediate sale is planned, the option remains “on the table” if the subsidiary cannot turn its operations around.

The Three-Year Ultimatum

MAG leadership has indicated that Firefly is currently in a critical probationary period. Following a major operational restructuring in August 2025, the airline has been given a window to prove its financial viability. The Star reports that the group intends to monitor performance closely over the next few years before making a “drastic decision.”

This timeline coincides with the expiration of specific aircraft leases, allowing the group to potentially exit the business with lower financial penalties if the turnaround Strategy fails. The decision to wait until 2028 or 2029 suggests that MAG is willing to give the carrier one final opportunity to succeed under its new dual-hub model.

Operational Shifts: The Move from Subang

A central factor in Firefly’s recent struggles was the performance of its jet operations at Sultan Abdul Aziz Shah Airport (Subang). In August 2025, the airline moved its entire fleet of Boeing 737-800 jets from Subang to KLIA Terminal 1.

According to industry data, the jet operations at Subang suffered from operational constraints and a lack of connectivity to the wider MAG network, leading to unsustainable yields. By relocating to KLIA, Firefly now operates in direct competition with low-cost carriers, while maintaining its turboprop (ATR 72-500) fleet at Subang for short-haul regional connectivity.

Financial Divergence

The Financial-Results health of the parent company stands in stark contrast to its subsidiary. MAG reported a net profit of RM54 million for 2024 and is projected to remain profitable through 2025. However, Firefly’s net losses reportedly widened in the 2024/2025 period. Data cited in recent research reports indicates that yields dropped by approximately 19% prior to the operational shift, dragging down the group’s overall margins.

Competitive Landscape and New Entrants

The Malaysian aviation sector is facing intense competition as 2026 approaches. Firefly’s move to KLIA Terminal 1 places it in a crowded market dominated by AirAsia and Batik Air Malaysia. AirAsia continues to lead with lower unit costs, making it difficult for Firefly to compete effectively in the value segment without cannibalizing Malaysia Airlines’ premium traffic.

Furthermore, a new state-backed competitor is set to disrupt the market. AirBorneo, owned by the Sarawak state government, is scheduled to take over Rural Air Services (RAS) from MASwings on January 1, 2026. The new airline plans to launch jet operations by July 2026, introducing fresh competition in East Malaysia, a key market for Firefly.

AirPro News Analysis

The hesitation to sell Firefly immediately likely stems from the complexity of the local aviation ecosystem. Firefly occupies a difficult “middle ground,” it lacks the massive scale of AirAsia to win on pure cost, yet it cannot drift too far upmarket without confusing the brand proposition of Malaysia Airlines.

From a strategic standpoint, holding the asset until lease expiration in 2028 makes financial sense. It avoids early termination fees and provides a hedge against the new competition from AirBorneo. If the move to KLIA fails to improve yields, a sale to a private equity firm or a regional group looking for valuable slots at Subang would be the logical exit strategy. For now, MAG seems content to use Firefly as a flanker brand, but the patience of the parent company is clearly finite.

Sources

• The Star
• Malaysia Aviation Group

This article summarizes reporting by Hindustan Times.

India Grants Approval to Two New Airlines: Al Hind Air and FlyExpress

The Indian Ministry of Civil Aviation has officially granted No Objection Certificates (NOCs) to two new airline startups, Al Hind Air and FlyExpress, according to reporting by the Hindustan Times. The approvals, issued in late December 2025, mark a significant step in the government’s effort to diversify the country’s aviation sector, which is currently dominated by a few major players.

These new entrants are expected to commence operations in 2026, joining Shankh Air, another startup carrier that received its initial approvals earlier in the year. As noted in the Hindustan Times report, the entry of these carriers comes at a time when the market is heavily consolidated, with IndiGo and the Air India Group controlling the vast majority of domestic traffic.

Profiles of the New Entrants

Based on the regulatory filings and industry profiles associated with the approvals, the two new airlines are adopting distinct strategies focused on regional connectivity rather than immediately challenging legacy carriers on trunk routes.

Al Hind Air

Al Hind Air is backed by the Alhind Group, a Kerala-based travel and tourism conglomerate with a reported turnover exceeding ₹20,000 crore. According to industry data, the airline will be based at Cochin International Airport (COK) and aims to serve as a regional commuter carrier.

The airline’s initial fleet strategy reportedly involves inducting 2–3 ATR 72-600 turboprop aircraft. This choice of aircraft suggests a focus on Tier-2 and Tier-3 cities in South India, connecting Kochi with destinations such as Bengaluru, Thiruvananthapuram, Chennai, Kozhikode, and Hubballi. While the carrier plans to eventually expand into international operations with narrow-body Airbus jets, its immediate focus remains on regional connectivity.

FlyExpress

The second carrier to receive an NOC, FlyExpress, is backed by Fly Express International Courier Cargo Service. Based in Hyderabad at the Rajiv Gandhi International Airport, the airline’s background in logistics suggests a potential hybrid business model that may combine passenger services with cargo operations.

Like Al Hind Air, FlyExpress is expected to launch in 2026. While specific fleet details remain scarce, the carrier is likely to utilize smaller regional aircraft suited for short-haul routes in South-Central India.

Shankh Air and the 2026 Landscape

In addition to the two newly approved carriers, Shankh Air is preparing for a Q1 2026 launch. Unlike its regional counterparts, Shankh Air is positioning itself as a Full-Service Carrier (FSC). It will be the first scheduled airline based in Uttar Pradesh, with hubs planned for the upcoming Noida International Airport (Jewar) and Lucknow.

According to available fleet data, Shankh Air plans to operate Boeing 737-800NG aircraft, offering a two-class configuration. The airline aims to scale rapidly, targeting a fleet of 20–25 aircraft within three years to serve high-demand routes across North India.

AirPro News Analysis: Breaking the Duopoly

The approval of these three carriers highlights a strategic shift in Indian aviation. Currently, the market is characterized by a “duopoly” where IndiGo and Air India Group hold over 90% of the market share. Recent operational challenges faced by major incumbents have underscored the need for greater market stability and consumer choice.

We observe that the government is actively encouraging these new entrants through the UDAN (Ude Desh ka Aam Nagrik) scheme, which subsidizes flights to unserved airports. By establishing bases in regional hubs like Kochi, Hyderabad, and Noida, rather than the saturated Delhi and Mumbai airports, these startups are lowering their entry barriers and aligning with national connectivity goals.

Frequently Asked Questions

When will Al Hind Air and FlyExpress start flying?
Both airlines have received their No Objection Certificates (NOCs) as of December 2025 and are expected to commence flight operations in 2026 after securing their Air Operator Certificates (AOC).

What aircraft will Al Hind Air use?
Al Hind Air plans to launch with ATR 72-600 turboprop aircraft, focusing on regional routes in South India.

Is Shankh Air a budget airline?
No. Shankh Air is positioning itself as a Full-Service Carrier (FSC) with Business and Economy classes, distinguishing it from the low-cost models of Al Hind Air and FlyExpress.

Sources

• Hindustan Times

This article summarizes reporting by NBC DFW.

American Airlines Eliminates Mileage Earning on Basic Economy Fares

American Airlines has quietly updated its loyalty program terms to remove all mileage and status earning capabilities from its lowest-priced tickets. As of this week, travelers purchasing Basic Economy fares will no longer accrue AAdvantage® miles or Loyalty Points, marking a significant shift in the carrier’s approach to budget-conscious flyers.

According to reporting by NBC DFW, the policy change took effect for tickets purchased on or after December 17, 2025. The move aligns American Airlines more closely with Delta Air Lines, which also restricts earnings on its most restrictive fares, effectively creating a “pay-to-play” environment for travelers seeking elite status.

The update was not accompanied by a formal press release but appeared as a revision to the “Basic Economy” section of the airline’s official website. This “stealth” implementation has drawn attention from frequent flyers and industry analysts who view it as a strategy to further segment customers based on their willingness to pay for premium attributes.

Details of the New Earning Policy

Under the previous structure, Basic Economy passengers earned 2 miles and Loyalty Points per dollar spent, a rate that was already reduced by 60% compared to standard Main Cabin fares. The new policy eliminates this earning potential entirely.

Key Changes and Effective Dates

The revised terms apply specifically to the date of purchase rather than the date of travel. According to the updated terms on AA.com:

• New Tickets: Basic Economy tickets purchased on or after December 17, 2025, earn 0 miles and 0 Loyalty Points.
• Grandfather Clause: Tickets purchased before December 17, 2025, will continue to earn at the previous rate (2 miles/points per dollar), regardless of when the travel actually takes place.

Remaining Benefits

While the ability to earn status has been removed, American Airlines has retained certain amenities that distinguish its Basic Economy product from ultra-low-cost carriers. Passengers traveling on these fares are still permitted one free carry-on bag and one personal item. Additionally, standard in-flight perks such as complimentary snacks, soft drinks, and entertainment remain included.

Travelers who already hold elite status will continue to receive their applicable benefits, such as priority boarding and upgrades, when flying Basic Economy, even though the flight itself will not contribute to retaining that status for the following year.

Industry Context: The Race to the Bottom?

This policy update places American Airlines in direct alignment with Delta Air Lines regarding loyalty earnings on basic fares, while widening the gap with other competitors.

Delta Air Lines currently awards zero miles or status credit for Basic Economy tickets. By matching this restriction, American has effectively standardized the “no-earn” model among two of the “Big Three” legacy carriers.

United Airlines takes a different approach. United allows Basic Economy passengers to earn Premier Qualifying Points (revenue-based credit) but does not award Premier Qualifying Flights (segment counts). However, United is significantly more restrictive regarding baggage, prohibiting full-sized carry-on bags for non-elite Basic Economy passengers on domestic routes.

In contrast, carriers like Southwest, Alaska Airlines, and JetBlue continue to offer loyalty incentives on their lowest fares, though often at reduced rates compared to standard tickets.

AirPro News Analysis

We view this move as a calculated effort by American Airlines to force a clearer choice upon the consumer: pay a premium for the possibility of status, or accept a purely transactional relationship with the airline.

By removing the trickle of Loyalty Points previously available on Basic Economy, American is signaling that its elite ecosystem is reserved exclusively for higher-yield customers. For a traveler spending $100 on a ticket, the loss of ~200 redeemable miles is negligible in terms of redemption value. However, the inability to earn Loyalty Points is a major blow to “status chasers” who rely on segment volume and cheap fares to reach tiers like AAdvantage Gold or Platinum.

Furthermore, the retention of the free carry-on bag suggests that American is wary of ceding too much ground to Spirit and Frontier. While they are willing to cut loyalty costs, they appear unwilling to adopt United’s strict baggage ban, likely to avoid alienating the general leisure traveler who prioritizes luggage space over frequent flyer miles.

Frequently Asked Questions

If I bought my ticket last week but fly next month, do I earn miles?
Yes. If your ticket was purchased before December 17, 2025, you will earn miles and points under the old policy (2 per dollar).

Does this affect Main Cabin tickets?
No. Standard Main Cabin fares and higher continue to earn miles and Loyalty Points at the standard rates (starting at 5 per dollar for general members).

Can I still bring a carry-on bag?
Yes. American Airlines has not changed its baggage policy for Basic Economy. You are allowed one free carry-on bag and one personal item.

Sources

• NBC DFW
• American Airlines