Tigerair Mandala slashes capacity and aircraft utilisation levels. Will other Asian LCCs follow?

Indonesia's Tigerair Mandala is boldly slashing capacity by about 40%, hoping to lead by example as it responds to overcapacity and challenging market conditions. The capacity cuts will reduce the carrier's average aircraft utilisation rate to less than nine hours, which is very low for an LCC operating a new fleet of A320s.

Reducing utilisation is an unusual move in Asia's low-cost sector, where expansion continues at an ambitious rate despite signs of overcapacity in several major markets including Indonesia. But reducing utilisation and even temporarily grounding aircraft is a more common response by LCCs in other regions during periods of low demand.

More Asian LCCs should consider adopting the strategy used by leading European LCC Ryanair, which parks up to 80 aircraft every winter. So far only tiny Tigerair Mandala, which is roughly number 35 among the 47 LCCs in Asia-Pacific, has taken the initiative.