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Japan's budget airlines hit rough air

Published on Jun 23, 2013 2:29 PM

TOKYO (AFP) - Japan's budget airlines have flown into turbulence with AirAsia's local carrier in danger of being grounded, but analysts say the popularity of discount flying should keep the fledgling sector in the sky.

Earlier this month, Malaysia-based AirAsia warned it might pull the plug on its partnership with All Nippon Airways (ANA), citing management tensions.

While details of the dispute remain unclear, AirAsia, the region's dominant budget carrier, said its Japanese business was "facing some challenges attributed to a difference of opinion in management, most critically on the points of how to operate a low cost business and operating from Narita" airport.

It added that AirAsia Japan was suffering from an "inability to manage costs".

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