Shares of AirAsia Group Bhd plunged by as much as 21% on Friday, hitting their lowest level in nearly four years amid reports that Malaysia’s government has considered asking other domestic carriers to take over parts of AirAsia’s market share. The decline followed discussions involving Malaysia Airlines Bhd and Batik Air as authorities monitor AirAsia’s financial condition, according to sources familiar with the matter.

At market close, AirAsia’s stock fell 21.09%, or 13.5 sen, to 50.5 sen, representing its steepest intraday drop since March 2026 and its lowest price since December 2022. Meanwhile, shares of Capital A Bhd, AirAsia’s parent company, dropped 16.36% to 23 sen, marking the largest one-day loss in over a year.

AirAsia has yet to comment on these developments. The carrier recently reported its largest quarterly loss in four years, driven largely by increased fuel costs following the outbreak of conflict in the Middle East. The airline’s financial strain has been worsened by an absence of fuel hedging strategies, leaving it vulnerable to volatile energy prices.

Earlier this month, AirAsia disclosed plans to raise upwards of US$1 billion in new funding aimed at refinancing high-cost debt, countering media speculation that the move was primarily a liquidity rescue. The airline is also in talks to restructure a US$200 million private credit loan, seeking more favorable terms amid its challenging financial position.

Year to date, AirAsia’s shares have depreciated nearly 70%, reflecting the worst performance among the 56 carriers listed on the Bloomberg World Airlines Index. The company faces significant pressure as it navigates an increasingly difficult market environment and rising operational costs.