Taiwan further reduces entry barriers for home-grown LCCs – who will be the first to enter?

Positive change continues to occur in Taiwan. A year ago its attitude towards new local entrants was obscure but now it is becoming clear and has fewer obstacles, further illustrated by recent changes that lower the entry barrier for a company that wishes to establish a new airline - such as a low-cost carrier. Majority Taiwanese ownership is required and the Taiwanese company establishing a LCC must be in air or sea transport or trade enterprise, a wide but not unlimited category. A new entrant would not be restricted to the tiny domestic market. The mood is that a home-grown LCC (or two) is now a question of when and who.

AirAsia and Peach could be contenders in addition to LCC subsidiaries of existing Taiwanese airlines. While air service agreements are liberalising, especially in the key Japanese market, it may still be sometime before Taiwan receives its own LCC. Landing fees outside of Taipei are being reduced but there is no definitive plan for a low-cost terminal or other incentives.