TransAsia Airways announced (08-Nov-2012) a firm order for six additional A321neos to be equipped with Pratt & Whitney PW1100G engines. The latest order brings the carrier's narrowbody orders to 29, including 12 A320neos with six to be equipped with Sharklets. TransAsia chairman Vincent Lin said, “The A321neo is a perfect fit for our strategy to grow efficiently in both domestic and regional markets and is the ideal solution to our fleet needs.” [more - original PR]
TransAsia places firm order for six additional A321neos
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TransAsia & V Air dual brand strategy collapses: TransAsia to become hybrid and V Air to shut down
Taiwan’s V Air, the LCC unit of TransAsia Airways, will end operations in Sep-2016 having carried only half a million passengers since its Dec-2014 launch. V Air was constantly the underdog to Tigerair Taiwan, although both are loss-making. V Air becomes the second notable Northeast Asian LCC to exit the market after AirAsia Japan (Mk I).
Whereas AirAsia Japan suffered from a shareholder dispute, V Air and TransAsia failed due to an unsuccessful dual brand strategy. The problem was one from the start, not a scenario that unravelled. V Air could have made decisions differently, but ultimately it hinged on TransAsia.
V Air’s collapse is not self-inflicted but rather, a failure of TransAsia. TransAsia’s decision to launch a dual brand strategy was unusual, given the small size of TransAsia and its undefined market position. Instead of the sum of the two airlines being greater than the individual parts, having two sub-scale airlines fragmented both. TransAsia operates 10 jet narrowbodies while V Air operates four. TransAsia will now restructure to pursue a hybrid business model, combining the two.
Aviation in Taiwan Part 2: LCC changes at Tigerair Taiwan, V Air and TransAsia.
This is Part 2 of a report on Taiwan's changing aviation scene. Tigerair Taiwan has become the island's largest LCC by far, twice the size of V Air, despite their launching a few months apart. Having expanded in Japan, the low-hanging fruit, Tigerair Taiwan now turns to more competitive markets in Southeast Asia and later to mainland China. Tigerair Taiwan will need to rebrand following expected rebranding among Singapore Airlines group LCCs, Tigerair and Scoot.
The larger challenge is at TransAsia and V Air. Full service TransAsia is moving to a hybrid model, bringing it even closer to its LCC, V Air. The overlap was awkward and now will increase, creating even more redundancy. TransAsia Airways has suffered following two crashes, but even before that its regional full service strategy with widebodies was at risk. There is a challenge of scale as V Air is one-fifth the size of TransAsia, itself very small, while Tigerair Taiwan is over two fifths the size of the longer established TransAsia. In short, TransAsia and V Air need to combine on a single strategy.
There is a small window of opportunity for V Air to take advantage of the anticipated Tigerair Taiwan rebranding. A downturn in tourism from mainland China further clouds the outlook. Although not entirely unexpected given the sensitive relationship with China, the decrease is no less painful.