AirAsia has decided not to pursue its plan to create a joint venture (JV) airline in Vietnam, at least in the short term.

The carrier revealed in a Malaysian stock market filing that it has “amicably agreed” with its Vietnamese partners to terminate the JV.

AirAsia had formed a partnership with Gumin Co. and Hai Au Aviation Joint Stock Co., and had indicated a Vietnamese franchise could begin operations this year.

Despite the termination, AirAsia said it “remains interested in operating a low-cost airline in Vietnam due to its favorable geographical location, expanding aviation market and overall growth potential.”

The Vietnamese JV was first announced in March 2017, and in December 2018 AirAsia Group CEO Tony Fernandes signed a memorandum of cooperation with the Vietnamese partners reaffirming their intentions.

The cancellation of the Vietnamese JV highlights the fact that the AirAsia Group has less appetite for opening new overseas franchises. In January, Fernandes said that after the Vietnamese launch, AirAsia would not open any more airlines for at least three years. Instead, the carrier will focus on strengthening its existing carriers.

AirAsia’s core operation is based in Malaysia, and it has affiliates and JVs in India, Indonesia, Japan, the Philippines and Thailand. The carrier had also intended to open a franchise in China but dropped that plan last year.

Adrian Schofield,