All Nippon Airways (ANA) president Shinichiro Ito said the carrier is targeting annual sales of between JPY150 billion and JPY200 billion (USD1.8 billion and USD2.5 billion) in five years from its LCC subsidiaries launching in 2012, acccording the The Nikkei reports. AirAsia Japan "will add five or six planes to its fleet each year, bringing the total to 25-30 aircraft in fiscal 2016," Mr Ito noted, adding that while the LCCs will "take away some of ANA's customers, they will contribute to group earnings". Peach Aviation, meanwhile, launched operations on 01-Mar-2012. [more - CAPA Blog]
ANA expects LCC subsidiaries to achieve annual sales of USD1.8bn to USD2.5b in five years
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LCC CEOs to lead discussions at CAPA North Asia LCC Summit, Tokyo, Jun-7/8-2016
Leaders of North Asia’s low cost carriers (LCCs) will gather in Narita on Jun-7/8 for CAPA’s North Asia LCC Summit.
Hosted by Narita Airport, the Summit marks 12 years of CAPA’s flagship series of LCC events in Asia and marks CAPA’s second return to Japan.
Featuring over 40 speakers, including senior executives from all of North Asia's LCCs, and with simultaneous translation in English, Japanese, Korean and Mandarin, the Summit will explore the commercial drivers for LCC growth in this region, as the market opens.
North Asia has yet to experience the rapid expansion of LCCs that has occurred in Southeast Asia - but that is changing quickly.
Taiwan's LCCs – Tigerair Taiwan and V Air – focus expansion on Japan; other markets incubating
In just over a year Taiwan's LCCs – Tigerair Taiwan and V Air – have carved a 10% share of the Taiwan-Japan market. More Taiwanese visit Japan than any other market while Taiwan is Japan's third largest outbound market after Korea and mainland China. Taiwanese have affinity for Japan and share some culture, and additionally a Nov-2011 open skies agreement has unlocked growth. Summer 2016 seat numbers are 143% higher than five years earlier in summer 2011. Summer 2016 is 26% up from 2015.
Six years ago there were no LCCs in the market. Now, LCCs make up 26% of the total market and have a higher share on specific routes: 30% between Osaka and Taipei, 43% between Tokyo and Kaohsiung. Taiwanese LCCs account for 35% of the LCC market – double their share at the start of 2016.
Lower costs in Taiwan and a home market advantage give Taiwanese LCCs a strong growth outlook in Japan. Yet elsewhere they are struggling to find new markets. Japan accounts for 57% of Tigerair Taiwan and V Air's seat capacity. Korea and Hong Kong are bilaterally constrained, while Southeast Asia has not been as popular a market. Taiwan's LCCs made quick wins in the underserved Japanese market but now have work ahead of them to build awareness of new markets.