China Airlines board is reportedly expected to approve plans to establish a Taiwan-based LCC JV with Tigerair at its meeting in Dec-2013. As reported by Economic Times, the start-up will be managed by China Airlines with Tigerair providing management advice and holding less than one third in ownership. The start-up will also supplement China Airlines’ existing route network. China Airlines chairman Sun Huang-hsiang reportedly stated the carrier will consider leasing new Boeing 737-800s or A320s for the start-up.
China Airlines board to approve LCC JV with Tigerair in Dec-2013: report
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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.
Aviation in Taiwan Part 1: Recalibration as events prompt changes at China Airlines & EVA Air
The last time there was so much change in Taiwanese aviation, there was cautious embrace of a new future. In 2009 there was the start-up of regularly scheduled Cross-Strait flights between mainland China and Taiwan. The historical moment was as symbolic as it was financial for Taiwan’s airlines, as the Cross-Strait flights offered plush yields and significantly boosted profits in an otherwise unremarkable market.
Change is again the theme in 2016. The reasons are varied and not clearly producing pessimistic or opportunistic views, but uncertainty is uncomfortable. Taiwan's two main airlines – China Airlines and EVA Air – have undergone management change as leaders became caught in the crossfire of non-aviation matters. EVA Air’s message is to continue with ambitious growth. China Airlines’ direction is less certain now that industrial action has saddled it with higher costs but the government could look to accelerate expansion, and perhaps rename the airline.