Start-up Saipan Air looks to re-establish Japanese traffic, but China may be more promising

The Northern Mariana Islands is set to receive its first home carrier when Saipan Air launches on 01-Jul-2012, initially serving Japan's Tokyo and Osaka as well as China's Beijing and Shenyang. Backed by Tan Holdings, Saipan's largest private employer, the carrier seeks to gain back the Japanese traffic the islands lost after Japan Airlines withdrew in Oct-2005, taking out 182,000 seats annually. Japanese arrivals, which accounted for 71% of arrivals, immediately declined by 25% and have been shrinking since.

With only Asiana and Delta Air Lines now directly linking Saipan and Japan, Saipan Air could make large inroads, but the three low-cost carriers starting in Japan this year could easily overtake the legacy carriers in Saipan's almost entirely leisure market. Meanwhile China has been a growing market for the Northern Mariana Islands. Not only are LCCs there nascent but the full service carriers are largely focussed on domestic and high-profile international flying.