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Business trends

Asia's irrationally exuberant airlines chase away profits

Carriers harvest less than $5 per passenger as more competitors crowd in

Although AirAsia throughout Southeast Asia, but faces stiff competition outside its home turf of Malaysia. (Photo by Keiichiro Asahara)
AirAsia has built a network of budget airlines across much of Asia but has only been able to find reliable profits in Malaysia. (Photo by Keiichiro Asahara)

BANGKOK/MUMBAI -- Fierce competition is decimating the bottom lines of Asia's airlines despite swelling passenger numbers.

Budget airlines have become especially popular among the region's enthusiastic middle-class travelers, but their proliferation has resulted in a profit margin of less than $5 per passenger, according to the Association of Asia Pacific Airlines.

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