22-Dec-2010 10:09 AM

Skymark aims to expand B737 fleet to up to 50 aircraft in four years

Skymark Airlines President Shinichi Nishikubo, at a Foreign Correspondents Club of Japan luncheon in Tokyo, outlined (21-Dec-2010) the following plans for the Japanese LCC:

  • B737 fleet plans: The carrier plans to almost triple its B737 fleet from 18 to 40-50 aircraft in four years to meet rising travel demand in the region. The aircraft will all be leased with Mr Nishikubo adding that the "core" of its fleet would remain B737 equipment;
  • A380 fleet plans: The carrier will add up to 15 A380s as it expands internationally to markets in Asia, Australia, Europe and the US. Mr Nishikubo added: "We can make a decision on whether to raise the total purchase to 15 [A380s] soon after we introduce our first Airbus 380s in 2014." Mr Nishikubo declined to say how much he has agreed to pay for the A380s, but added that the manufacturer "had made a great effort on the price". On the engines for its A380s the President stated it would seek "explanation from Rolls-Royce" over the recent A380 engine incident but added: "There is still a fair possibility that we will choose Rolls-Royce." The aircraft will be configured for business class and premium economy class with about 400-450 seats;
  • Shares: Mr Nishikubo, who owns 49% of the airline, stated the carrier had no plan to sell shares or issue bonds to finance the expansion. He added: "I have no worries about the funds to buy 380s as Skymark's business is quite good." The carrier's shares have almost tripled this year;
  • Cash reserves: The carrier has JPY8 billion in cash and that the company intends to continue buying US currency;
  • Alliance: Mr Nishikubo stated there were no immediate plan to form an alliance with other airlines and stated the carrier has no other investment partners at the moment. He continued: "Skymark is a crazy company. No one but I wants to invest massive funds in such a company";
  • Employees: The carrier plans to hire around 470 former Japan Airlines employees with the carrier receiving application from more than 200 pilots. It has already hired 50 pilots and plans to add around 150 more. The carrier is also scheduled to hire 80 mechanics and 300 cabin attendants with international flight experience;
  • International network:  Skymark plans to offer flights services from Tokyo Narita to London, Frankfurt and New York. If the airline succeeds in its international business, it will aim to expand services to cities such as Los Angeles, Sydney, Melbourne and Singapore. Mr Nishikubo stated he was confident of gaining the necessary approvals stating: "The Ministry of Land, Infrastructure, Transport and Tourism (MLIT) has expressed a very favourable view towards our plan. We have spoken to the British and French embassies and we have not encountered any problems." The carrier added that international A380 services will operate from Tokyo Narita due to MLIT restrictions on operation of the aircraft at Tokyo Haneda due to turbulent wake fears, denied by Airbus
  • Domestic expansion: The carrier is expanding from Tokyo Narita. The carrier has 32 daily services from Haneda and plans to have the same level of frequency at Narita in the next five years;
  • High speed rail competition. Mr Nishikubo stated he believes there would be little impact from the Kyushu Shinkansen on Skymark’s Kobe-Kyushu service. The line opens fully to Kagoshima in Spring 2011. He commented: “Our ‘planes are much smaller than trains and there are people in a hurry who want the speed of air transport – and there are people who like ‘planes. I don’t think our passenger numbers will be much affected."

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