"We were really interested in Skymark, but I don't think it's going to happen. We had a look at it, but I think we lost that…. it's complicated, so we don't think our suggestion is going to go through," Fernandes told CNBC on the sidelines of the World Economic Forum in Jakarta on Sunday.
ANA Holdings, one of Japan's two major airlines along with Japan Airlines, will take a 20 percent stake in Skymark Airlines, Reuters reported over the weekend.
Skymark, Japan's leading low-cost carrier, filed for bankruptcy protection in late January. The independent airline blamed a weaker yen and a dispute over down payments for Airbus jets for its insolvency. The firm was delisted from the Tokyo Stock Exchange on March 1.
"I don't think that's good for Japan. They're going to end up with two airlines, really. And so hopefully Japan can inject a little more choice," Fernandes said.
Air Asia still plans to launch its own routes to Japan next year, according to Fernandes. The launch was delayed numerous times because certification by the Japanese regulators has taken longer than expected, but Fernandes is confident the launch will happen.
"We're going through the application process now, and we're very confident in our model. It's taken longer, because I think there are a few more airlines, and the regulators want to go through all their rules and regulations, but we're on schedule to start early next year," said Fernandes.