Low Cost Carriers Target Hokkaido

By 27th January 2012 August 27th, 2013 Uncategorized

SEVERAL new low cost carriers (LCCs) will start servicing New Chitose/Sapporo this year, as well as many other airports across Japan. Budget airlines Peach Aviation, Jetstar Japan, and Air Asia Japan have announced the launch of their domestic routes between March and December 2012. Stiff competition is also expected from recent Korean startup “Jin Air” and the soon-to-launch Singapore air LCC “Scoot”. With so many new airlines all promising the lowest fares, visitors from Honshu could fly to Chitose for prices equivalent to one “Hakuho peach sold at Kinosato farmers’ market,” according to Peach Aviation officials.

Osaka based PEACH is the first homegrown LCC in Japan, and stands for: Pan-Asia, Energetic, Affordable, Cute & Cool, Happy. Peach Aviation CEO Shinichi Inoue promises to provide “safe, low cost travel 365 days of the year, making air travel easier and more accessible. Our airline will also reflect the smart sophistication that has come to represent the words Cool Japan.”

CEO Bruce Buchanan of competitor Jetstar Group says “we will beat any competitor’s fare by 10 per cent at the time of booking. It shows our absolute commitment to offering the lowest fares. This guarantee means we won’t be beaten on price in what will be a very competitive market, and it is one of the ways we intend to be Japan’s number one LCC.”

ANA President and CEO Shinchiro Ito, who teamed up with Air Asia to create new LCC Air Asia Japan, plans to make the fares of the Tokyo based carrier about half or a third of the price ANA currently charges. He promises “the lowest airfare in the market” and adds, “we will fight very hard to ensure that we do that.”

But it is Peach Aviation who will have first-mover advantage on the market. They have already started selling tickets for their first flights in March with Jetstar Japan and Air Asia Japan expected to follow shortly after. Experts believe that Peach can help the market adjust to LCC pricing strategies, whereas Air Asia and Jetstar will be able to take advantage of building on it.

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