Peach Aviation CEO Shinichi Inoue forecasts the carrier will transport 4.0 million passengers in 2013, which will be four times its expected passenger traffic this year, according to CAAC-News. The carrier transported 240,000 passengers in the three months ended May-2012 and reported an average load factor of 77%, surpassing its target of 70% to 75%. The Osaka Kansai-based carrier launched operations in Mar-2012.
Peach Aviation targets 4.0 million pax in 2013
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Finnair and TAP Portugal: their location based long haul niche strategies compared
Both Finnair and TAP are based in peripheral corners of Europe: Finnair in the extreme northeast and TAP in the southwest. Both are based in countries with relatively small populations, but they have developed networks that capitalise on their geographic location to carry connecting traffic from across Europe and elsewhere to long haul destinations in other continents.
TAP's main long haul market is Upper South America (primarily Brazil), but it also has a secondary long haul niche in Africa. Finnair's main long haul market is Northeast Asia, with an additional presence in South and Southeast Asia. Both also operate to the US. On short haul, LCC competition has been a bigger threat to TAP than to Finnair, but cost savings are important to both.
TAP and Finnair have similar traffic volumes, unit costs and average trip lengths. Moreover, both have struggled to generate sustainable profitability. This report compares and contrasts Europe's two leading independent exponents of the location based long haul niche strategy. Both are set to accelerate their long haul growth.
Korea-Japan: LCCs are poised to overtake full service airlines for first time in Northeast Asia
For the first time in Northeast Asian aviation, low cost airlines are poised to overtake full service airlines in a significant way. The market concerned is that between Japan and Korea, where LCCs are rapidly growing, while full service airlines are decreasing capacity. Overall market size and visitor figures are at record highs. This refutes any legacy airline thinking that LCCs "steal" market share; LCCs are growing the market and becoming the future – as they already are in other parts in the world.
LCCs accounted for 1% of available seats between Japan and Korea in 2009, reached 37% in 2016, and so far in 2017 will account for 49% of the market. Limited airport data indicates that LCCs, operating at higher load factors, already transport more passengers than full service airlines, and by the end of 2017 LCCs should easily account for the majority of capacity.
LCCs already fly more airport pairs than their full service counterparts. The LCC development between Japan and Korea illustrates underlying LCC opportunity in Northeast Asia but also reflects on the importance of liberalisation, and for full service airlines to have efficient cost bases.