Abstract
Southeast Asia is home to one of the largest budget airline sectors, with low-cost carriers (LCCs) accounting for nearly half of seat capacity on scheduled flights in 2018. The most prolific no-frills carrier in the region is Malaysia-based AirAsia, which has affiliates in Thailand, Indonesia, the Philippines, and beyond. Similarly, Indonesia's Lion Air has formed a family of related carriers across much of the region. These and other LCCs have prospered partly through their political connections, illustrating that even in a liberalized region the power of the state to shape the industry remains formidable. A challenge for the industry is the lack of secondary airports and of strained capacity at the region's principal hubs; pilots and other skilled industry personnel are in short supply too. Nevertheless, the development of long-haul budget airlines, including Singapore Airlines’ subsidiary Scoot and several long-haul affiliates of AirAsia signals the maturity of the LCC sector.
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