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Recorded at CAPA LCCs in North Asia, 13-14 Jun 2017

Vanilla Air Update

Vanilla Air is hoping to improve performance of its Taipei-Ho Chi Minh fifth freedom route. Most passengers are not connecting onwards to Tokyo. The connecting Tokyo flight is more popular with Taipei-Tokyo local passengers. Vanilla is not actively considering more fifth freedom routes but would consider opportunities. Vanilla is also considering longer-range aircraft and ways to grow ancillary revenue.

Transcript

Mio Yamamuro:Our flight from Narita, Taipei to Ho Chi Minh, Saigon was our first fifth-freedom route. Yes, we had struggled on the first days, but we are picking up some traffic from both Taipei and also from Saigon. Overall, the load factor between Taipei between Taipei and Ho Chi Minh is about 80% on average. Majority travel only between Taipei and Saigon, but we are also seeing some increase in the traffic from Saigon through Taipei to Narita. One of the reasons why we do not see much increase in the through traffic is probably because the flight that connects to and from between Taipei and Ho Chi Minh, that connects to our most highest load factor route between Taipei and Narita. So that gets filled up very quickly before they pick up the traffic from between Taipei and Saigon. So that may be one of the reasons that we do not see as much increase as we wish to see. If there is business opportunities, we are looking for another destination using our fifth freedom. We don't have anything planned, specific destination at the moment, but eventually if there is a chance If we have a business chance, then we would use the fifth freedom to fly to another destination. We only have A320. That sort of limits our reach from Narita to Southeast Asia. So using fifth freedom would give us— expand our opportunities to look for a new destination. Yes, we would love to consider. At the moment, we don't have any concrete plan, but we are studying to see if there is any opportunities to get a bigger longer-range aircraft. The percentage of our ancillary is not as big as some of the airlines. We have certain— we are trying to get more ancillaries because it is part of our important revenue. We are expanding some services. We have increased menus for food and beverage. We hope to see a big jump this year, but we have to wait and see.

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