As the Asian market continues to accelerate and the regional middle class expands, the low-cost carrier industry is expected to prosper as well. According to the research institute Frost and Sullivan, this sector has witnessed an increase in market penetration from a mere 1.1 percent in 2001 to 14 percent in 2008.
Future passenger numbers are predicted to grow from 116 million in 2008 to 217 million in 2012. With such clear demand, it's no wonder there is a queue of budget and mid-priced players eager to flap their wings. Below, we list the five of those planning to start up by the end of 2012.
AIRASIA JAPAN
This partnership between All Nippon Airways' (ANA) and AirAsia, brings together “the complementary strengths of the two companies,” says their corporate statement. AirAsia Japan – to be based at Tokyo Narita airport – is scheduled to begin services from August next year.
Network: Details have not yet been released, except in the general terms of Northeast Asian destinations and domestic routes. Routes will be made official once ANA's application to the Legal Affairs Bureau of Japan on August 31 to register the fledgling airline goes through.
Fleet composition: This too has to be confirmed, but in all probability, A320s will be used as in AirAsia’s other ventures around the region.
Website: www.ana.co.jp or www.airasia.com
JETSTAR JAPAN
With demand for budget travel in the country increasing, as well as government efforts to revive the aviation and tourism industry with open skies agreements (see story here and here) and the easing of visa restrictions (see story here), it was only a matter of time before Japan Airlines (JAL) entered the LCC arena. This, it has done, partnering with Qantas and the Mitsubishi Corporation to establish Jetstar Japan, which will begin services late next year.
Network: While the carrier’s offiicial base has not yet been announced, the new airline intends initially to fly from Tokyo and Osaka to Sapporo, Fukuoka and Okinawa, eventually branching out to “key Asian cities.”
Fleet composition: Jetstar Japan will begin operations with a fleet of three single-aisle Airbus A320 aircraft, featuring 180 seats, eventually expanding to a complement of 24 aircraft.
Website: www.jetstar.com or www.jal.com
PEACH AVIATION
All Nippon Airways' (ANA) second foray into the LCC arena is Peach Aviation, a joint venture with Hong Kong-based First Eastern Investment Group. It will be based in Osaka Kansai. Though rates have not yet been revealed, the carrier claims it will offer fares 50 percent lower than that of ANA.
Network: The carrier is scheduled to begin flights on March 1 next year between Osaka and Sapporo and Fukuoka. Eventually, the carrier will begin international flights. Click here for the launch schedule.
Aircraft: The carrier will be using 10 Airbus A320s, featuring 180 seats.
Website: www.flypeach.com
THAI TIGER
This joint venture between Thai Airways and Tiger Airways has faced several delays since it was announced in August 2010 (see story here). Originally, the project was scheduled to take off on January 2011, but was shelved due to opposition from the transport ministry which was concerned that Thai Tiger would cannibalise Nok Air’s market share, which Thai Airways also has a stake in. Recently, however, the new transport minister Sukampol Suwannathat announced that he was backing the deal.
Meanwhile, Thai Airways has announced the launch of Thai Smile Air, described as its “light premium” subsidiary airline serving regional routes. It is expected to debut in July 2012.
Network: Though the network has not yet been confirmed, the carrier will be based at Bangkok’s Suvarnabhumi Airport, offering services within a five-hour flying radius both domestic and international, thus avoiding an overlapping with routes that Thai already operates.
Fleet composition: The carrier will use Airbus A320s.
Website: www.thaiair.com or www.tigerairways.com
SINGAPORE AIRLINES
Without warning Singapore Airlines (SIA) recently jumped onto the LCC bandwagon by announcing its own no-frills subsidiary (see story here). The aim, SIA said, was to “serve a largely untapped market and cater to the growing demand among consumers for low-fare travel”. Though the name of this airline has not been officially announced, it is believed that the new low-cost subsidiary will be called Scoot.
Network: Yet to be announced, but unlike the rest of the new LCCs above, SIA’s version will serve medium- and long-haul routes.
Fleet composition: Aircraft type has not yet been revealed.
Website: www.singaporeair.com
Subscribers can read an in-depth, exclusive analysis of the Asian low-cost carrier market development and its effects on legacy airlines by clicking here.
Alisha Haridasani
