Jetstar Group CEO Bruce Buchanan stated (16-Aug-2011) Jetstar Japan, a proposed low cost airline JV between Japan Airlines, Qantas and Mitsubishi Corp, aims for sales of JPW100 billion (USD1.3 bilion) in "a few years" (Dow Jones, 16-Aug-2011). Despite the rising yen and a recent slump in tourism levels to Japan (following the 11-Mar-2011 earthquake and tsunami), Mr Buchanan expressed confidence in turning the joint venture profitable soon, noting that most of the businesses at Jetstar became profitable early on in their launch. Jetstar Japan plans to set its fares around 40% below the average in Japan. [more - Perspective]
Jetstar Japan aiming for sales fo USD1.3bill in few years; likely to be quickly profitable: Jetstar
You may also be interested in the following articles...
China-Japan aviation: LCCs Peach, Jetstar Japan gain traffic rights, raising overcapacity concerns
Jetstar Japan and Peach Aviation have received air traffic rights for China which, if utilised, would grow the Japanese LCC footprint in China – Japan's largest visitor source market. Spring Japan became the first Japanese LCC to serve China in Feb-2016. The absence of Japanese LCCs in China may seem surprising, but there are regulatory hurdles, market access questions and conservatism at Japanese LCCs. AirAsia Japan, launching in 2017, will likely leverage the group's China experience; it is the largest non-greater China airline group serving China.
The prospect of further growth comes as incumbents cite overcapacity. What was once a profitable market now only produces returns in the peaks. All Nippon Airways, the largest airline between Japan and China, reported lower revenue on the back of "a deterioration in the supply-demand environment". Spring China has told Bloomberg that some competitors "aren't well-prepared", and will be "phased out". Overall Japanese LCC routes and capacity may be small but will be watched by Chinese airlines, ever mindful of the need to find new business models.
CAPA Perspectives: Japan-Australia hits the accelerator to become the fastest growing market
After being quiet for so long, Japan is moving quickly. Seat capacity between Australia and Japan has increased by 35.6% to be the largest international growth market for Australia so far in 2016. The increase can be attributed to Qantas’ expansion of its Japanese operations with the addition of Brisbane-Tokyo Narita, while ANA returned to Sydney from Haneda in late 2015.