Taipei Taoyuan International Airport

SIA’s Scoot again targets under-penetrated Taiwanese market with new service to Seoul

Singapore Airlines' (SIA) long-haul low-cost subsidiary Scoot is further exploiting the absence of a local LCC in Taiwan by selecting Singapore-Taipei-Seoul Incheon as its seventh route. Scoot is already the largest low-cost carrier serving Taiwan, which has the lowest LCC penetration rate among major Asian markets. Following the mid-2013 launch of Jetstar Hong Kong, Taiwan will also be the last remaining medium or large-size market in Asia without a local LCC.

Scoot launched service in Sep-2012 on the Singapore-Taipei-Tokyo Narita route, which the carrier now serves daily. The carrier has been focusing primarily on stimulating demand in the local Singapore-Taipei and Taipei-Tokyo markets rather than on Singapore-Tokyo through passengers.

Scoot will similarly focus on the under-served Taipei-Seoul market after launching the Singapore-Taipei-Seoul route on 27-May-2013 with an initial three weekly frequencies. The new route will also boost Scoot’s presence in the competitive Singapore-Taipei market as the additional three weekly flights make Scoot the largest carrier on the route, just ahead of SIA.

VietJet to pursue more rapid expansion in 2013; Jetstar Pacific needs to respond – fast

VietJet Air is planning to add three new domestic and three new international routes in the coming months as Vietnam’s leading low-cost carrier continues to pursue rapid expansion. VietJet has already surpassed rival LCC Jetstar Pacific to become Vietnam’s second largest carrier after Vietnam Airlines with approximately a 15% share of the country’s fast-growing domestic market. The privately-owned carrier will see its share of capacity in Vietnam’s domestic market approach 20% by mid-2013 – an impressive achievement given it only launched services in Dec-2011.

VietJet now operates 10 routes, including one international route, with a fleet of six A320s. It plans to operate by the end of 2013 a fleet of 10 A320s on 16 routes – 12 domestic and four international.

Hawaiian Airlines endures short-term pain to secure, it hopes, successful longevity

Hawaiian Airlines faces a challenging time during 1H2013 as its efforts to diversify outside of the Hawaii-US west coast market during the last few years need more time to bear fruit. Its ambitious long-haul expansion is accompanied by the introduction of a new inter-island subsidiary and the reworking of other portions of its inter-island network.

All of the changes Hawaiian is undertaking or planning to introduce are intended to bolster efforts to preserve its profitability, which has been fairly consistent during the last few years. But in the near future the carrier is facing pressure as its new long-haul Asian markets spool up and increases in competitive capacity create pressure in its trans-Pacific service to the continental US.

While the strategy Hawaiian is adopting to persevere in the long-term is solid, the airline might be attempting to accomplish too much too fast, which in the shorter-term is creating pressure on yields and unit revenues.

Taiwan’s TransAsia Airways' growth Part I: Expanding role in Northeast Asia-Southeast Asia traffic

Part one of this report on the growth strategy for Taiwan's TransAsia Airways looks at how the carrier is seeking a greater role in Northeast Asia-Southeast Asia connecting traffic. To facilitate a greater ranger of destinations – the carrier's sole Southeast Asian point is Singapore – TransAsia plans to open service to Bangkok as well as destinations in Indonesia and Malaysia. In Northeast Asia, a Tokyo service may be added while frequency boosts will occur at existing Japanese destinations.

One Asian market TransAsia is not interested in is Taipei-Hong Kong, the world's most populous international route and which is currently experiencing over-capacity following the opening of cross-Strait flights between Taiwan and mainland China, a market TransAsia is present in. The carrier's new A330s, its first widebodies, will initially be used on blue-chip regional routes to raise awareness and also where demand justifies their presence.

United excludes Houston in new domestic and international push from US hubs

After embarking on promised cuts from its Houston Intercontinental (IAH) hub, United Airlines is introducing new long and short-haul service from all its other US hubs starting in Nov-2012, further enforcing its decision to pull-down its Houston operations after the city endorsed plans by Southwest to launch new international service from the city’s second airport, Houston Hobby.

United will transfer its Paris service from Houston to San Francisco, where United will also resume direct flights to Taipei, where it now has codeshare authorisation with Star Alliance member elect EVA Airways. United is also growing internationally in the Americas, with intentions to launch Chicago-Monterrey and Washington Dulles-San Salvador as well as service to Canadian cities of Thunder Bay and Kelowna, and seasonal services from Chicago to Nassau.

Taiwan's EVA Air confirmed as new Star member, considers converting UNI Air subsidiary to an LCC

Taiwan’s EVA Air formally signed on 29-Mar-2012 with Star Alliance to join the grouping after Star’s Chief Executive Board unanimously accepted the carrier's membership application. Wholly owned regional subsidiary UNI Air, however, will not be joining Star and EVA President KW Chang has instead revealed is was a possibility that UNI may be converted to a low-cost carrier.

As Asia’s network airlines quickly establish their own LCC subsidiaries, the pressure mounts on others to follow suit and EVA is apparently no exception. In a clear sign that the flurry of LCC subsidiary announcements by other airline groups in Asia was influencing EVA management thinking, Mr Chang Kuo-wei said “it is one thing we are thinking of, but it is only a possibility this stage”. While it ponders a possible new short-haul LCC strategy, EVA hopes to leverage its Star Alliance membership to expand on long-haul routes.