Japan Airlines (JAL) may set up a budget airline with part of its Y350 billion (US$4 billion) capital injection from the Japanese government, as it looks to rebuild its business after declaring bankruptcy in January.
The former state-owned airline, which is burdened with some of the industry’s highest operating expenses, was considering launching a “Japanese-style low-cost carrier” to cater to frugal leisure travellers, JAL president Masaru Onishi said in a The Financial Times report. “There is a lot of interest in low-cost carriers and we will research the issue and decide how to proceed.” The move to budget airlines is also being considered by Japan Airline’s local rival, All Nippon Airways, to keep its cheaper regional competitors at bay. Japan’s airspace has been liberalised of late with the deregulation of its traditionally protected air travel market. Newly expanded airport capacity in Tokyo and other major Japanese cities has opened the country to foreign airlines. Qantas’ low cost carrier offshoot, Jetstar, flies between several Japanese and Australian cities, with Malaysia’s AirAsia also planning to enter the market. Japan Airlines said its operations had been profitable for the past five months, and is projecting an operating surplus of Y641 billion for the business year to March. Last year it reported a Y133.7 billion loss. |
JAL is looking to tap into the low-cost carrier market |
No comments:
Post a Comment