TransAsia and UNI Air lead Taiwan's second tier airlines into new markets

Taiwan's airlines are gearing up for a boom in visitors from Mainland China. Taiwan’s Transportation and Communications Minister Mao Chikuo has urged Taiwanese carriers to purchase more aircraft before the number of Mainland tourists permitted to visit the island increases from 5 million presently to 10 million p/a over the next three to four years. While the demand will no doubt be captured predominantly by the nation's two major carriers, EVA Air and China Airlines, some of the nation's smaller carriers are also targeting rapid expansion in the months and years ahead on cross-Strait and near-international routes.

Taiwan’s airlines urged to expand their passenger fleets

Mr Mao stated Taiwan’s passenger fleet is not adequate to meet current market demand and has urged local carriers to show more interest in expanding their capacity.

According to Taiwan’s Civil Aeronautics Administration, there were 196 registered aircraft in Taiwan at the end of Jun-2011. China Airlines had the largest fleet with 67 aircraft, followed by EVA Air (50), UNI Air (19), TransAsia Airways (16), Far Eastern Air Transport (10), Mandarin Airlines (eight) and Daily Air (seven).

China Airlines (CAL) and EVA Air are responding. CAL Chairman Zhang Jiazhu in Jun-2011 stated the carrier would expand its fleet from 68 to more than 100 aircraft in the next five to 10 years. EVA Air President Chang Kua-wei stated the carrier would acquire 20 aircraft to meet robust demand from China. See related article: China Airlines and EVA Air still optimistic about improved profitability despite weaker first half

According to Ascend, Taiwanese airlines have 44 aircraft on firm orders, predominantly widebodies.

Taiwan fleet breakdown for on-order aircraft: at 12-Sep-2011

TransAsia and UNI Air spreading their wings

The nation’s smaller airlines are also expanding, led by TransAsia, which is undergoing an aggressive expansion plan fuelled by cross-Strait demand and an international network drive.

Meanwhile, EVA Air subsidiary UNI Air this month announced plans to acquire 10 ATR 72-600s to support its regional expansion. UNI is currently the fourth largest carrier operating to/from and within Taiwan, according to CAPA's Airline Ranking Tool, while TransAsia is fifth and Mandarin Airlines is sixth. Daily Air and Far Eastern Air (FAT) are smaller Taiwanese carriers operating in the market. 

Top 20 airlines serving Taiwan by capacity (seats and ASKs): Week ended 18-Sep-2011



Total Seats

Total ASKs


China Airlines








Cathay Pacific Airways




Uni Airways




TransAsia Airways




Mandarin Airlines








Japan Airlines




China Eastern Airlines




Air China Limited




Thai Airways International




China Southern Airlines




Vietnam Airlines




All Nippon Airways




Singapore Airlines




Xiamen Airlines




Air Macau




Malaysia Airlines




Jetstar Asia




Delta Air Lines



TransAsia expects to introduce a new investor ahead of listing in Nov-2011

TransAsia Airways Chairman Vincent Lin stated last month the company expects to introduce an unnamed strategic investor before its primary listing on the Taiwan Stock Exchange Corp, which is expected in Nov-2011. “The investor will be a company with business experience of international airlines and which will therefore be able to help boost TransAsia technically and operationally,” Mr Lim said.

The carrier plans to raise around TWD1.2 billion (USD41 million) in private equity capital through the sale of 100 million shares, Mr Lin said. Upon its listing, the carrier plans to issue 22.2 million shares, at a price of TWD18 (USD0.61) per share, to raise TWD400 million (USD14 million). The capital will be used to fund its fleet expansion and general revenues. It will become the third carrier in Taiwan to be listed, after EVA Air and China Airlines.

TransAsia has been listed as an emerging stock on the GreTai Securities Market’s emerging stock bourse since Nov-2010. The airline is now able to list on the main bourse as it has met the requirement of two years of consecutive profits. The carrier reported a net profit of TWD13 million (USD440,000) in 2009 and TWD918 million (USD31 million) in 2010.

Mr Lin stated the carrier expects earnings in the airline sector, including at TransAsia, to grow in the second half of the year, compared with the first half, as oil prices decline and amid strong seasonal demand.

The carrier reported a operating profit of USD12.2 million in the six months ended 30-Jun-2011, a 7.2% year-on-year increase according to reports in the Chinese media. Profit before tax increased by 7.2% to USD14.1 million and profit after tax declined by 0.9% to USD12.0 million. Operating revenue increased 5% year-on-year to USD140.2 million. TransAsia Airways stated revenue on cross-Strait and international services accounted for 70% of its total revenue while domestic services accounted for 25% of its revenue.

TransAsia subsequently reported a 1.6% year-on-year increase in sales revenue to TWD851 million (USD29 million) for Aug-2011. For the first eight months of 2011, the carrier reported a 4.2% increase in sales revenue to TWD5784 million (USD198 million). The carrier expects its revenue to continue to grow in the 3Q2011 with the launch of more international charter services.

In terms of traffic, TransAsia reported a 3.1% year-on-year increase in passenger numbers to 279,792 in Jul-2011, driven by a 5.8% increase in domestic passengers (156,416). International passenger numbers weakened slightly (-0.1% to 123,376) in the month. Passenger load factors, meanwhile, declined 3.5 ppts to 81.3%. Load factors on domestic routes stood at 82.0% (+1.8 ppts) with an average load factor of 81.2% on international services (-5.0 ppts).

TransAsia to operate to all major cities in Asia within five years

Mr Lin, as quoted by the China Times in 01-Jul-2011, stated the carrier hopes to operate to all major cities in the Asia Pacific region including Seoul, Bangkok, Jakarta and Tokyo within the next five years. The carrier also hopes to operate to cities within nine hours reach including those in Australia, New Zealand and the Middle East. TransAsia is scheduled to receive two 313-seat A330 aircraft between 2012 and 2013, which it hopes to use in operations to Sydney, Guam and Eastern Europe.

The carrier’s ability to grow has been enabled by government permission to serve international destinations including Bangkok, Colombo and Singapore. In the past, only China Airlines and EVA Air were permitted to serve international capital cities. Of Taiwan's smaller airlines, TransAsia now has the largest international presence.

Taiwan international capacity (seats per week) by carrier: 12-Sep-2011 to 18-Sep-2011

As part of this expansion, TransAsia Airways launched daily Taipei-Singapore on 30-Jun-2011 with A320 aircraft. With the new service, six carriers now operate a total of 60 weekly services linking Singapore to Taipei. The others are Sinagpore Airlines, China Airlines, EVA Air, Jetstar Asia and Tiger Airways. An estimated 702,000 O&D passengers travelled on the route in 2010, a 12% year-on-year increase. In the first five months of 2011, the route grew by 16.5% to more than 385,000 passengers.  

Taipei Taoyuan International Airport to Singapore Changi Airport capacity (seats) share (one way): 04-Jul-2011 to 04-Mar-2012

Taipei Taoyuang-Singapore Changi is the fourth largest Taiwanese route, based on currently capacity (seats) data, according to Innovata.

Top 10 Taiwan routes by seats: 12-Sep-2011 to 18-Sep-2011


Origin Airport

Destination Airport

Weekly seats


Hong Kong International Airport

Taipei Taoyuan International Airport



Taipei Taoyuan International Airport

Tokyo Narita Airport



Hong Kong International Airport

Kaohsiung International Airport



Singapore Changi Airport

Taipei Taoyuan International Airport



Bangkok Suvarnabhumi International

Taipei Taoyuan International Airport



Taipei Songshan Airport

Makung Airport



Taipei Songshan Airport

Tokyo Haneda Airport



Taipei Songshan Airport

Kinmen Shang-Yi Airport



Taipei Taoyuan International Airport

Macau Airport



Taipei Taoyuan International Airport

Seoul Incheon International Airport


TransAsia, meanwhile, stated it is no longer considering establishing joint-venture airlines in South Korea and China, as was the case a few years ago. The carrier was considering the services in response to declining domestic traffic due to the introduction of Taiwan’s high-speed rail, but has gained a reprieve from declining traffic due to the success of the profitable cross-Strait services.

TransAsia busy expanding cross-Strait services

TransAsia is busy expanding its services to mainland China. The carrier, in Jun-2011, was allocated 10 of the additional 94 cross-Strait services, including one additional Shanghai service. With the increase, TranAsia’s allocation of cross-Strait rights increased from 34 to 44 times weekly from mid Oct-2011. See related article: Cross-Strait services upped; Taiwan allows individual mainland tourists for first time since 1950s

After progressively adding cross-Strait services to its network, TransAsia is the sixth largest operator on services between Taiwan and China behind China Airlines, EVA Air, China Eastern Airlines, Mandarin Airlines and Air China.

China to Taiwan (seats per week, one way): 04-Jul-2011 to 04-Mar-2012

TransAsia, like the other cross-Strait operations, has said it expects traffic to improve in late Sep-2011 ahead of the Oct-2011 national holiday Golden Week. Taiwan Civil Aeronautics Administration Director Yin Chengpeng earlier this month stated Taiwanese carriers have requested the addition of 86 flights during the Chinese New Year holiday period between 09-Jan-2012 and 05-Feb-2012, including 37 flights by China Airlines and 25 flights by EVA Air. Mr Yin stated he will discuss the proposals with his mainland counterparts next month. UNI Airways is also seeking six additional cross-Strait flights, TransAsia Airways is seeking six while Far Eastern Air Transport is seeking 12 additional flights.

TransAsia Airways also plans to launch five new routes between Taiwan and China from 01-Nov-2011. The new routes will be focussed on service from Kaohsiung in southern Taiwan and Hualien in east Taiwan. Details include:

TransAsia, meanwhile, is codesharing on Shenzhen Airlines’ six times weekly Wuxi-Taipei Taoyuan service, effective 29-Aug-2011. Direct services between Taipei and Wuxi were launched in early 2011 with 14 weekly services offered. From Taiwan, China Airlines has been awarded four weekly services on the sector while TransAsia Airways has been awarded three services. The carrier also commenced codeshare services with Xiamen Airlines on cross-Strait services in Mar-2011 covering Kaohsiung-Fuzhou, Kaohsiung-Xiamen, Taichung-Xiamen and Taipei Sung Shan-Fuz sectors. 

TransAsia launched an additional Taipei Taoyuan-Shanghai Pudong (red-eye) service from 12-Aug-2011 and launched weekly Kaohsiung-Changsha service from 21-Aug-2011. The carrier previously launched three times weekly Hualien-Hefei service on 20-Jul-2011, with plans to launch Taipei Songshan-Hefei service at the end of 2011.

TransAsia Airways and Xuzhou Airport, meanwhile, signed a cooperation agreement on 25-Jun-2011 in which the carrier will increase capacity between Taiwan and Xuzhou Airport. The number of frequencies on the Xuzhou-Taipei sector is expected to increase from three to five flights per week from the end of Oct-2011. The first direct service between Taiwan and Xuzhou was launched on 28-Mar-2011.

According to Taiwan Tourism Bureau, outbound departures from Taiwan rose 4.5% year-on-year in Jul-2011 to 1.0 million, with Mainland China (282,336), Hong Kong (223,461) and Japan (137,475) the largest outbound markets. Visitor arrivals increased 7.1% to 458,122, led by visitors from Mainland China (128,430), Hong Kong/Macau (73,782) and Japan (94,009). International passenger numbers and cross-Strait passenger levels both reached record levels in Jul-2011, according to the Taiwan Civil Aeronautics Administration.

International passenger numbers and cross-Strait passenger numbers at Taiwanese airports: Sep-2009 to Jul-2011

Cross-Strait passenger numbers and load factor: Sep-2009 to Jul-2011

Cross-Strait flights and seats: Sep-2009 to Jul-2011

TransAsia looking to Japan. Japan-Taiwan open skies agreement to be signed in Sep-2011

TransAsia also plans to launch scheduled passenger services to secondary cities in Japan.

Japan Interchange Association President Mitsuo Ohashi is scheduled to visit Taiwan and sign an open skies agreement on 22-Sep-2011 to liberalise bilateral commercial aviation exchanges between Japan and Taiwan. The carrier hopes to commence scheduled service to Japan in 1Q2012 as a result of the agreement. TransAsia previously operated charters to Japan but never scheduled services.

Under the proposed new open skies agreement, Tokyo Haneda Airport will be open to flights between 22:00 and 07:00 and the number of flights to Tokyo Narita will be increased from 36 per week to 38, while restrictions to other Japanese and Taiwanese destinations, with the exception of Taipei Songshan Airport, will be lifted. Peach Aviation and Skymark Airlines are reportedly planning to commence services between Japan and Taiwan while TransAsia Airways, UNI Airways and Mandarin Airlines will be permitted to change their current charter services between Japan and Taiwan to regular scheduled services.

Far Eastern Air Transport, which has not yet received approval to operate to Japan, will also be permitted to enter the Japanese market. Taiwan’s Civil Aeronautics Administration Planning Director Cheng Jiali stated the new open skies agreement could come into effect as early as 30-Oct-2011.

TransAsia Airways Corp Chairman Vincent Lin in Aug-2011 also stated the airline would renew charter services to Akita Airport on 09-Sep-2011. This is part of plans to resume charter services to five cities in Tohoku (northeast Japan) and Hokuriku (Japan Sea) regions from Sep-2011.

TransAsia plans to operate seven charter services between Sep-2011 and Nov-2011 to cities including Asahikawa, Hakadote, Hanamaki, Aomori, Kumamoto, Kushiro, Obhiro, Ishigaki, Fukushima and Niigata. The airline operated around 500 charters in 2009 and 1071 charters in 2010 to Japan with an average load factor of 90%. TransAsia is also looking to offer regular services on routes to Japan in line with the open skies policy of the Japanese Government. The carrier plans to file an application for the services with the Japanese Government by the end of 2011. Currently, most of the air carrier’s services between Taiwan and China and between Taiwan and Japan are charter services.

Fleet expansion ahead for TransAsia

Taiwan Cooperative Bank launched TransAsia Airways’ TWD5500 million (USD186 million) 12-year aircraft procurement financing case on 24-Aug-2011. The financing is split into two parts where TWD2750 million (USD93 million) will be used to finance two A330-300s, which are scheduled for delivery in Dec-2012 and Jan-2013, respectively. TransAsia announced the purchase of two A330-300s and six A321-200s in Nov-2010.

TransAsia operates five A321s, two A320s and nine ATR 72-500s at present. The carrier has 15 aircraft on order, including six A320-200s, six A320-200neos, two A330-340s and one A320-230. The carrier will receive this A320, leased from AWAS on 15-Oct-2011, bringing the carrier’s A320/A321 fleet to eight.

The carrier is also speaking to leasing companies about taking an A320 or A321 for delivery in 1Q2012. TransAsia’s first two A321s on order are scheduled for delivery in 2014, a further two in 2015 and two more in 2016.

The A321neos, of which the carrier has six on order as per a firm order placed in Jun-2011, will be delivered at a rate of two p/a from 2017 through to 2019. The carrier will deploy the aircraft on regional routes, including cross-Strait services. The carrier has selected Rolls-Royce to power the A330s with Trent 700 engines, with the first aircraft slated for delivery in Nov-2012 and the second in Jan-2013.

TransAsia fleet profile: as at Sep-2011

TransAsia has stated it has no plans to increase the size of its turboprop fleet, but it wants to replace the current fleet with new models. The carrier will likely start replacing its turboprop fleet, which currently has an average age of 11 years, in 2013. While the carrier operates ATR 72-500s at present, it would consider ATR 72-600 and Q400 equipment.

UNI Air signs contract for 10 ATR 72-600s; B777 and A330 acquisitions to come

While TransAsia has no plans to add ATRs to its fleet, UNI Air on 09-Sep-2011 signed a contract with ATR to purchase 10 ATR 72-600s. Deliveries are scheduled to commence in 3Q2012.

UNI Air will use its new 72-seat ATR-600s to progressively replace its 56-seat Dash-8-300 aircraft and some of the existing MD90s in its fleet. The aircraft will be operated on routes to the offshore islands of Kinmen, Penghu and Matsu in the Taiwan Strait, the company said. UNI Air will acquire more ATR 72-600 aircraft depending on the demand for its local and China routes, the carrier added. 

UNI Air is the largest carrier in the domestic market, with a 51.3% domestic market share or around 73,000 weekly seats, based on Sep-2011 Innovata data.

Domestic Taiwan capacity (seats per week) by carrier: 12-Sep-2011 to 18-Sep-2011

In network news, UNI Air launched the first international charter service from Tainan, between Tainan and Xiamen, with MD90 equipment on 08-Sep-2011. The carrier also launched weekly Taipei Taoyuan-Yancheng service on 07-Sep-2011. The carrier likewise plans to launch three times weekly Taipei-Shenyang serviced on 14-Dec-2011.  

UNI Air operated its final service on the Taipei Sung Shan–Pingtung sector on 08-Aug-2011, ending its six year operation to the southern Taiwanese airport. The carrier cancelled the three times weekly service due to poor performance, which at times saw more flight crew on board than passengers. This also marks the end of commercial operations at Pingtung Airport, which opened to commercial service in 1995. Following the closure of Pingtung, UNI Air moved operations to Taipei Sung Shan, with service to Taitung increasing from 21 to 23 weekly from 12-Aug-2011. On Taipei Sung Shan–Matzu Nangan route, scheduled service increased from 42 to 43 weekly.

UNI Air the largest of the smaller Taiwanese carriers

UNI Air is the largest of the smaller Taiwanese carriers by passenger numbers and capacity, although Mandarin, over the past few months, has witnessed faster-growing passenger growth than UNI Air. UNI’s load factors, meanwhile, are weaker than its peers, based on the carriers’ monthly traffic data. (See Appendix for more information.)

Passenger traffic comparison for China Airlines, EVA Air, Daily Air, Mandarin Airlines, TransAsia Airways, UNI Air: Sep-2009 to Sep-2011

Passenger traffic growth for China Airlines, EVA Air, Daily Air, Mandarin Airlines, TransAsia Airways, UNI Air: Sep-2009 to Sep-2011

Load factor comparison for China Airlines, EVA Air, Daily Air, Mandarin Airlines, TransAsia Airways, UNI Air: Sep-2009 to Jul-2011

Load factor (%) for China Airlines, EVA Air, Daily Air, Mandarin Airlines, TransAsia Airways, UNI Air: Sep-2009 to Jul-2011

Capacity growth (%) comparison for China Airlines, EVA Air, Daily Air, Mandarin Airlines, TransAsia Airways, UNI Air: Sep-2009 to Sep-2011

Mandarin Airlines adding routes

Mandarin Airlines, the regional subsidiary of China Airlines, this month stated plans to reduce Kaohsiung-Seoul Incheon frequency from daily to five times weekly from 01-Oct-2011, as the airline commences twice weekly Kaohsiung-Osaka Kansai service on 30-Sep-2011. The carrier launched Taipei Taoyuan-Yancheng service on 07-Sep-2011 and will increase Taichung-Ho Chi Minh City frequency from daily to nine times weekly frequency on 11-Oct-2011 and launch twice weekly KaohsiungChangsha service on 01-Nov-2011.

Mandarin Airlines operates a fleet of eight E190s, across a network of domestic and international routes. Its network is split roughly 50:50, in terms of seats, across domestic and international routes.

Mandarin Airlines international vs domestic capacity share: 12-Sep-2011 to 18-Sep-2011

FAT launches third international route

Far Eastern Air Transport (FAT) this month announced the launch of charter services from Taipei Taoyuan to Da Nang in Vietnam with 165-seat MD aircraft on 18-Aug-2011 after receiving approval from the Taiwan Civil Aeronautics Administration on 17-Aug-2011. The carrier also launched international scheduled services to Siem Reap in Cambodia in mid Jul-2011, charter services to Cebu in the Philippines in early Aug-2011 and twice daily Taipei-Makung service on 22-Jul-2011. 

FAT, which operates three aircraft at present, has stated it plans to lease three to five more Airbus aircraft to support its launch of cross-Strait services to eight mainland destinations during the winter schedule, commencing 30-Oct-2011. The carrier, which resumed operations in mid Apr-2011, has been told by the Taiwan Civil Aeronautics Administration that it must increase its fleet to at least nine aircraft by 20-Oct-2011 or the 15 new cross-Strait flights awarded to them will be re-allocated.

Outlook: Bold steps ahead

The island's busiest airport, Taiwan Taoyuan International Airport has witnessed passenger and cargo transfer traffic declines in the first half of 2011, despite the surge in demand from the Mainland.

Passenger traffic volumes declined 4.1% to 11.9 million arrivals in 1H2011, including a 14.9% decline in transit passengers to 892,600. Cargo volumes declined 6.7% to 817,433 tonnes, as trans-shipped cargo slumped 14.0% to 284,681 tonnes. “The figures are a warning sign,” Taoyuan International Airport Corp (TIAC) chairman and deputy minister of transportation and communications Yeh Kuang-shih said. He added if the airport wants to become an East Asia transportation hub, it must be able to attract transit passengers from China.

Taipei Taoyuan International Airport passenger numbers: 2009 to 2011

Taipei Taoyuan International Airport cargo volume: 2009 to 2011

Taiwan's aviation industry will have to work hard to overcome the slow start to 2011. It has a massive opportunity with cross-Strait liberalisation, which commenced in Aug-2009 and has been progressively opening up the skies between Taiwan and the Mainland. Progress has not been linear, but the political climate is at least conducive to expanded operations. With a domestic market decimated by high-speed rail, Taiwan's airlines risk putting too much stock in cross-Strait services, should the political mood shift.

Nevertheless, the nation's airlines are expanding their fleets and networks in the Mainland, but not all are putting their eggs in the one basket. TransAsia for one, as its name suggests, is looking further afield and will be an interesting carrier to watch for airports around the region.


Far Eastern Air Transport traffic highlights in Jul-2011:

  • Passenger numbers: 31,518, n/a year-on-year*;
  • Passenger load factor: 76.5%, n/a;
  • Number of flights: 288, n/a.

Daily Air traffic highlights in Jul-2011:

  • Passenger numbers: 14,413, +6.2%;
  • Passenger load factor: 91.09%, +1.7 ppts;
  • Number of flights: 858, +4.1%.

UNI Air traffic highlights in Jul-2011:

  • Passenger numbers: 356,310, +5.3%;
    • Domestic: 304,791, +3.5%;
    • International: 51,519, +17.1%;
  • Passenger load factor: 79.12%, -0.5 ppts;
    • Domestic: 80.98%, +4.3 ppts;
    • International: 76.87%, -7 ppts;
  • Number of flights: 4228, -0.2%;
    • Domestic: 3902, -1.7%;
    • International: 326, +23.5%.

TransAsia Airways traffic highlights in Jul-2011:

  • Passenger numbers: 279,792, +3.1% year-on-year;
    • Domestic: 156,416, +5.8%;
    • International: 123,376, -0.1%;
  • Passenger load factor: 81.3%, -3.5 ppts;
    • Domestic: 82.0%, +1.8 ppts;
    • International: 81.2%, -5.0 ppts;
  • Number of flights: 3446, +3.8%;
    • Domestic: 2587, +4.8%;
    • International: 859, +0.8%.

Mandarin Airlines traffic highlights in Jul-2011:

  • Passenger numbers: 229,356, +8% year-on-year;
    • Domestic: 113,165, +4.2%;
    • International: 116,191, +12%;
  • Passenger load factor: 83.4%, -2.5 ppts;
    • Domestic: 81.18%, +1.5 ppts;
    • International: 84.18%, -4.1 ppts;
  • Number of flights: 2128, +7%;
    • Domestic: 1308, +1%;
    • International: 820, +18.2%.

Taiwan outbound travel up 4.5% in Jul-2011

Taiwan Tourism Bureau reports outbound departures rose 4.5% year-on-year in Jul-2011. Details include:

  • Outbound departures: 1.0 million, +4.5% year-on-year;
  • Outbound departures by destination:

Visitor arrivals to Taiwan up 7.1% in Jul-2011

Taiwan Tourism Bureau reports visitor arrivals to Taiwan rose 7.1% year-on-year in Jul-2011. Details include:

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