Porter Five Forces of Airasia

By 2009, AirAsia had established itself as Asia's most successful low-cost airline. Between January 2002 and March 2009, AirAsia had expanded from two aircrafts and 200.000 passenger journeys to 79 aircraft and 11.8 million passengers. Its route network had grown beyond Malaysia to cover 10 South-Asian countries. In addition to its hub in Kuala Lumpur, Malaysia, it had replicated its system by establishing associated airlines in Thailand and Indonesia.

By 2007, UBS research showed that AirAsia was the world's lowest cost airline with costs per available seat kilometre (ASK) significantly below those of Southwest, Jet Blue, Ryanair or Virgin Blue. It was also one of the world's most profitable airlines. In 2008, when very few of the world's airlines made any profit at all, AirAsia earned return on asset of 4%. In 2009 it won the Skytrax Award as ‘the World's Best Low Cost Airline'.

Air Asia had built its business on the low-cost carrier (LCC) model, created by Southwest Airlines in the US and replicated throughout the world by a host of imitators.