Budget carriers fill vacuum in air routes

22 Apr 2009

With major carriers like Cathay Pacific, Qantas and Singapore Airline trimming down routes and capacity, budget airlines are stepping in to fill the void for travellers who are left in the lurk by these sudden cuts.

Low-cost travel is the least affected segment of the airline industry as the global recession takes its toll.

At the Pacific Asia Travel Association Conference held Monday in Macau, Andrew Herdman, director general of the Association of Asia Pacific Airlines, noted: “It (low-cost travel) is doing extremely well at the moment as passengers move to the back of the plane to save on flight costs.”

He also pointed out low-cost carriers are bucking the trend among full-service airlines by adding frequencies and routes.

In the past several weeks, budget carriers have been aggressive not only in coming out with new low fares but have also began increasing flight frequencies and adding new routes.

Singapore-based budget carrier Tiger Airways kicked off its new Singapore-Jakarta service three weeks ago, as air routes across the Asean opened up. The airline now serves the capital cities of the six largest economies in the region. Moreover, it is set to introduce its Melbourne-Sydney route in July.

“We are seeing increased traffic from business travellers driven by the expanded network but also through business people trading down to take advantage of our low fares,” said Matthew Hobbs, head of communications for Tiger Airways.

As proof of the airline’s optimistic outlook, he added that Tiger Airways also has 56 A320 aircraft on order for delivery through to 2016.

Rival AirAsia is busy adding new routes to its service network. The most recent one is the Kuala Lumpur-Tianjin service, which was launched on April 2.

A large expansion into South Asia is also in the pipeline. News reports claimed that AirAsia plans to add six more destinations in India to its network, as well as the Sri Lankan capital of Colombo.

“In today’s economic climate, AirAsia is better equipped than full-service airlines to expand its operations. We expect more corporate clients to come to us in their efforts to slash costs, including those related to travel,” said Desiree Bandal of AirAsia’s communications department.

Leslie Ng, head of commercial at Jetstar agreed, noting that “since October, there has been a three-fold increase (in the number of) business travellers flying with us”.

To better serve customers flying to multiple destinations, Jetstar has signed commercial agreements for interline and ticket settlement relationship with Etihad, Air Tahiti Nui and Air Calin.

The agreements allow more travel options for passengers to build more complex itineraries as part of a single transaction.

Meanwhile, in anticipation of increased passenger numbers, Jetstar is looking at hiring new staff. It has launched a part-time scheme for cabin crew, targeting former flight attendants to return to the airline industry by allowing flexible shifts.

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Gigi Onag and Joshua Tan

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