North Asian LCCs challenged by liberalisation and pilot shortage but optimistic on partnerships

2014 marked a turning point in North Asia, as the Sep-2014 launch of Tigerair Taiwan meant each of North Asia's key markets had an LCC, catching up to Southeast East Asia. Not only have LCCs have been more prolific in Southeast Asia, it has only been much more recently that North Asia received LCC activity. CAPA's recent Aviation Summit and LCC Congress explored the theme of where North Asia's LCCs are, the challenges they face and the outlook they project.

A panel featuring executives from Jeju Air, Tigerair Taiwan and Vanilla Air discussed cost challenges, including in some markets the lack of pilot availability as well as the overall high cost of expatriate pilots, especially in China.

Liberalisation is also a limiting factor, and one that has held back the growth of North Asian LCCs; the penetration rate of LCCs in North Asia is greatly lower than in Southeast Asia. Although lagging in organic reach compared to counterparts in Southeast Asia, these North Asian LCCs were optimistic about the ability to form partnerships.