A wave of international service announcements confirms overseas expansion is very much on the agenda for Asia’s burgeoning LCC segment. Several LCCs are seeking to diversify their traffic bases and/or to…
A wave of international service announcements confirms overseas expansion is very much on the agenda for Asia’s burgeoning LCC segment. Several LCCs are seeking to diversify their traffic bases and/or to boost aircraft utilisation rates as the Centre for Asia Pacific Aviation reports. But all would be in search of higher yields that international services can offer, although their encroachment into these markets will have a depressing effect on fares, which would be of concern to established carriers.
LCCs are responsible for over 56% of the additional seats offered within the Asia Pacific region this month, with a startling 3.5 million more seats on 19,000 extra services by LCCs alone, compared to May-06. India and Malaysia domestic markets are the hotspots, but the impact is spreading throughout the region like a brush fire.
The AirAsia Group, ahead of the launch of long-haul services in Sep-07, is very much focused on developing its intra-ASEAN network, with the Malaysian operation planning to open new routes to Vietnam, Laos and Myanmar in coming months. Southern China is another focus, with the Thai unit expanding its reach into the Pearl River Delta with the launch of Bangkok-Shenzhen service in Jul-07, with plans to launch services to Kunming, Chengdu and Chongqing later this year.
Another Thai LCC, One-Two-Go, is however avoiding China in its international expansion plans. The carrier will lease 14 MD-80s from Japan Airlines, as part of plans to boost its fleet to 22 aircraft by 2008, with new routes planned to Phnom Penh and Siem Reap later this year, as well as Singapore, Malaysia, Denpasar and Bangladesh at a later date.
Also in Thailand, Nok Air is focusing on India, with plans to launch services to Bangalore, followed by Chennai and Hyderabad, to capture rising demand and boost aircraft utilisation rates by operating back-of-the-clock services across the Bay of Bengal.
In terms of long-haul, low-cost options, Viva Macau confirmed plans to launch services to Sydney by late Jul-07 as it takes delivery of its third B767 next month. It also plans to launch services to Incheon and Osaka within the next two months, before launching services to Europe by the end of 2007. Across the Pearl River Delta, Oasis Hong Kong Airlines will launch six times weekly Hong Kong-Vancouver service on 28-Jun-07 and confirmed plans to add 5-15 new destinations and up to 25 aircraft to its fleet within five years.
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