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Jetstar Japan is a joint venture between Qantas Airways, Japan Airlines and Mitsubishi Corporation. The carrier operates from its hub at Tokyo Narita International Airport, with a secondary base at Osaka Kansai. The LCC operates domestic services to cities including Fukuoka, Okinawa and Sapporo. Jetstar Japan's fleet of Airbus A320 aircraft are sourced from affiliate Qantas Airways.
Location of Jetstar Japan main hub (Tokyo Narita Airport)
LCCs will continue to evolve into hybrids of the original core model. CAPA and OAG consider Jetstar Japan fits the LCC profile and it is included in our reporting on this basis. Please note: when reporting for an airline is changed from or to LCC the historical data is not affected and it can lead to a distortion in the current reported data. Contact us if you have any queries.
414 total articles
47 total articles
In just over a year Taiwan's LCCs – Tigerair Taiwan and V Air – have carved a 10% share of the Taiwan-Japan market. More Taiwanese visit Japan than any other market while Taiwan is Japan's third largest outbound market after Korea and mainland China. Taiwanese have affinity for Japan and share some culture, and additionally a Nov-2011 open skies agreement has unlocked growth. Summer 2016 seat numbers are 143% higher than five years earlier in summer 2011. Summer 2016 is 26% up from 2015.
Six years ago there were no LCCs in the market. Now, LCCs make up 26% of the total market and have a higher share on specific routes: 30% between Osaka and Taipei, 43% between Tokyo and Kaohsiung. Taiwanese LCCs account for 35% of the LCC market – double their share at the start of 2016.
Lower costs in Taiwan and a home market advantage give Taiwanese LCCs a strong growth outlook in Japan. Yet elsewhere they are struggling to find new markets. Japan accounts for 57% of Tigerair Taiwan and V Air's seat capacity. Korea and Hong Kong are bilaterally constrained, while Southeast Asia has not been as popular a market. Taiwan's LCCs made quick wins in the underserved Japanese market but now have work ahead of them to build awareness of new markets.
Leaders of North Asia’s low cost carriers (LCCs) will gather in Narita on Jun-7/8 for CAPA’s North Asia LCC Summit.
Hosted by Narita Airport, the Summit marks 12 years of CAPA’s flagship series of LCC events in Asia and marks CAPA’s second return to Japan.
Featuring over 40 speakers, including senior executives from all of North Asia's LCCs, and with simultaneous translation in English, Japanese, Korean and Mandarin, the Summit will explore the commercial drivers for LCC growth in this region, as the market opens.
North Asia has yet to experience the rapid expansion of LCCs that has occurred in Southeast Asia - but that is changing quickly.
Japan Airlines is eagerly counting down to 01-Apr-2017, which is expected to be the date when business expansion restrictions on JAL that were put in place after its bankruptcy restructuring will be lifted. The rules are complex and contain exceptions; JAL has been able to open new service to points like Boston and San Diego and invest in Jetstar Japan, but not able to open other routes or to invest in Skymark Airlines. Recent years have been a bonanza for its rival All Nippon Airways, which had been Japan's No. 2 airline but used government support and JAL's restrictions to embark on ambitious expansion, from long haul growth to purchasing Skymark Airlines and A380s.
JAL is unlikely to engage in rapid capacity expansion. JAL is firmly focused on maintaining high airline margins while replicating ANA's group strategy of non-cyclical ground-based businesses (flight training, maintenance, etc.). One exception however is Southeast Asia, where ANA has been growing. Japan has become politically closer to Southeast Asia and commercially too, with tourism influxes.
Yet there is still a hesitation when it comes to organic growth. One solution could be a partnership with AirAsia, which would give JAL access to a wide network and growing business segment. In return, JAL could even invest in AirAsia Japan, which is facing start-up delays and could benefit from parental help. JAL would join ANA in having two LCCs; JAL is an investor in Jetstar Japan, whose owner Jetstar is a partial rival to AirAsia. JAL-AirAsia would combine two of ANA's main foes: AirAsia Japan, which was a JV between ANA and AirAsia, was dissolved in bitter disagreement.
All Nippon Airways is going back to its roots. Japan's second airline commenced international scheduled service in Mar-1986 with a service to Guam, one of the Pacific Islands that attracts Japanese tourists. ANA's international launch was hard fought against the then mighty Japan Airlines, and ANA has since focused on blue-chip premium routes. In doing so, it has placed less focus on the beach/resort markets such as Guam, Hawaii and Palau. Despite JAL's shrinkage – it is now smaller than ANA – JAL remains the largest in these beach markets.
ANA is considering how its wholly owned LCC Vanilla Air could expand there and give ANA a larger group presence, Vanilla Air president Tomonori Ishii said at CAPA's recent Asian Aviation Summit in Singapore. JAL has similarly used its LCC, Jetstar Japan, to give it a larger group presence in markets ANA was traditionally stronger in, such as Nagoya and onsen destinations in the south. Vanilla Air will need widebodies to reach these leisure markets non-stop from Japan, and this is a development under consideration. It would be a leap for Japan's still relatively young LCC sector, but ANA faces the larger task of perhaps integrating its two LCCs, Vanilla and Peach.
Japanese LCCs could tackle booming Chinese market as AirAsia Japan launches and Spring Japan expands
There is no shortage of superlatives to describe the passenger traffic growth between China and Japan. Chinese visitors are quickly becoming Japan's single largest tourism source. China Southern's Japan passenger numbers in the first nine months of 2015 have exceeded its traffic for the full year 2014. 14 Chinese airlines intend to serve Japan at the end of 2015, including five carriers which have entered in 2014 or 2015. China's Spring Airlines has virtual bases at Nagoya and Osaka Kansai and is planning to construct hotels in Japan to accommodate the visitors it is bringing over.
Japan's LCC sector is vibrant, with five start-ups in four years. They have helped rejuvenate Japanese traffic despite the shrinking economy and decreasing local population. Yet they have remained absent from the China-Japan market. The 2012 China-Japan territorial dispute weakened travel conditions, and since then the local LCCs appear to have felt overwhelmed by the influx of Chinese carrier capacity. This will start to change: AirAsia Japan plans to launch in Mar-2016 and eventually serve China, a market its affiliate carriers know well. Spring Airlines Japan, the locally established JV of Shanghai-based Spring, will finally commence international services in 2016 and is making two Chinese cities, Chongqing and Wuhan, its first destinations. Despite the growth already witnessed, this is only the beginning for the market. Japanese LCCs will have a role in its expansion.
AirAsia Japan has submitted to Tokyo an application for an Air Operator's Certificate to re-enter the Japanese LCC market, its first JV having collapsed in 2013. AirAsia Japan envisions a Mar/Apr-2016 launch from Nagoya, an airport without the heavy competition or curfew AirAsia Japan Mk I encountered at its previous base of Tokyo Narita.
The start-up plans to complete 2016 with six A320s and grow by five aircraft each additional year. In Jul-2015, Jetstar Japan operates 20 A320s, the most of any new LCC, followed by Peach with 16 A320s. AirAsia Japan will be out to show it has learned from past mistakes and can apply its pan-Asian model, with some localisation, in multiple markets.
Japan continues to benefit from this influx of carriers. Domestic growth has slowed to 2%, but Japan saw 92m domestic passengers in its latest reporting year, the highest since 2007. AirAsia Japan will be unique along with Spring Airlines Japan for not being affiliated with ANA or JAL, which directly account for 79% of the market and indirectly for over 90%. Slowing domestic growth has however come with faster 9% outbound international growth. 1H2015 inbound tourism is up a remarkable 46% and Japan will need to set more ambitious targets than 20m visitors in 2020. 2015 could welcome 18 million visitors, up from 10 million in only 2013.