Corporate Travel News For Asia

Jetstar Japan chief executive advisor Nick Rohrlach, speaking at the CAPA LCCs in North Asia Summit, stated (11-Jun-2018) Jetstar Japan is "really happy" about Japan Airlines' (JAL) plans to establish a long haul lost cost airline based at Tokyo Narita Airport, adding that it demonstrates JAL's commitment to the LCC sector. Mr Rohrlach noted Jetstar Japan has the largest domestic network amongst Japan's LCCs in terms of destinations and frequencies, and said the LCC aims to establish connections between its domestic operations at Narita and the proposed long haul low cost airline's international operations at Narita. He said airports in Europe, including London Gatwick Airport, are making efforts to facilitate LCC to LCC connections.

Eastar Jet VP Pil Je Cho, speaking at the CAPA LCCs in North Asia Summit, stated (11-Jun-2018) Eastar Jet's international airport strategy in developed primary markets, such as Japan, includes targeting secondary airports as hub airports are typically saturated. Mr Cho said the LCC could consider operating to airports like Asahikawa Airport as an alternative to capacity constrained Sapporo Chitose Airport, or Ibaraki Airport as an alternative to Tokyo Narita Airport and Tokyo Haneda Airport. He added that in less developed markets, such as Vietnam, Eastar targets primary hub airports.

Air Philip strategy and planning manager Sangyun Kim, speaking at the CAPA LCCs in North Asia Summit, stated (11-Jun-2018) rather than receiving financial support from the Government, Air Philip would like to see "a level playing ground" for incumbent and start up LCCs in South Korea in terms regulations. Mr Kim noted that according to South Korea Ministry of Land, Infrastructure and Transport (MOLIT) policies start up LCCs like Air Philip must operate 50 seat aircraft to receive a licence but such aircraft are no longer widely produced and are thus difficult to acquire. He added that MOLIT should increase the limit to approximately 80 seats to enable start up LCCs to acquire new aircraft to ensure passenger comfort.

Hainan Airlines announced (Jun-2018) plans to sell up to 20% of its Shanghai listed shares to 10 investors to raise up to CNY7 billion (USD1.1 billion), with proceeds from the sale to be used to fund aircraft purchases, aviation training, maintenance and airport business. The carrier also plans to purchase stakes in aviation training, maintenance business and airlines, valued at CNY10.5 billion (USD1.6 billion), from HNA Group and its subsidiaries as it looks to continue to consolidate its aviation asset. The acquisition will enable the airline to expand the routes, strengthen development in aviation maintenance, flight training and other services. Following the restructure, its controlling shareholder will change from Grand China Air to HNA Group and parties acting in concert. [more - original PR - Chinese]

Malaysia Airlines Group (MAG) CEO Izham Ismail stated (08-Jun-2018) the carrier reported a 6.6% increase in yield to MYR 22.6 sen (USD 5.67 cents) in the three months to 31-Mar-2018, explaining: "Our performance is on budget for quarter one and the concerted focus on yield, which began in the second half of the previous year, continues to see results with an overall improvement in yield and RASK". Revenue per available seat kilometre (RASK) increased 3.5% year-on-year, outpacing total revenue growth of 2%. Mr Ismail added: "I am heartened by the relatively encouraging first quarter of 2018, especially after a challenging FY2017 which saw the company underperform against budget. Our performance last year was hampered by an adverse exchange rate swing which saw the depreciation of the ringgit against the US dollar (USD). With more than 50% of our cost structure in USD, the depreciation had a significant impact on the company's overall financial performance. Nevertheless, taken on aggregate, the company has made progress on the execution of the Malaysian Airlines Recovery Plan (MRP). This includes an improved cost base for the airline, bringing it in line with its peer network airlines". He however noted that the carrier is preparing itself for a tough year ahead with competition and exchange rate volatility. He said escalating fuel prices remain a particular concern, up almost 100% from early 2016. "Moving forward we will continue to drive yield by focusing on the premium segment to cushion the airline from rising costs. Overall, we expect to see improvements in our performance in the later part of this year and against this backdrop, we are working hard to deliver sustained profitability in 2019", he added. [more - original PR]

Philippine Airlines (PAL) and Airbus stated (08-Jun-2018) the carrier's new A350-900 has completed its first flight from the Airbus assembly line in Toulouse, France. The flight marks the start of the final phase of the production process, leading to customer acceptance and delivery in the coming weeks. Philippine Airlines has ordered six A350-900s. The airline will use these aircraft on its premier long haul services from Manila to destinations in North America and Europe. The A350-900 will join an existing Airbus fleet at Philippine Airlines that currently includes 26 A320 Family aircraft, 15 A330s and five A340s. [more - original PR]

TAROM CEO Werner Wilhelm Wolff stated the carrier is interested in a partnership with LOT Polish Airlines, as well as the launch of services to China and the US from 2019 (ch-aviation/aviator.aero/Pasazer, 07-Jun-2018). The carrier is considering the optimal aircraft for the planned long haul services. The carrier is also reportedly interested in Boeing 737 MAX aircraft.

Thai Airways and Rolls-Royce signed (07-Jun-2018) a cooperation agreement for the establishment of an authorised engine MRO centre. The parties aim to expand on Thai's existing MRO capabilities by adding new engine types. Thai Airways operates more than 50 widebody aircraft powered by Rolls-Royce engines. Thai Airways acting president Usanee Sangsingkeo said: "Thai has the capability to expand its engine maintenance services for Rolls-Royce Trent 700 and Trent 1000 engines, which will meet the needs of the regional market, making sufficient use of the maintenance facilities and further develop a joint business venture together. This collaboration will also increase revenue earned from international customers". [more - original PR]

Malaysia Airlines Group CEO Izham Ismail said he is targeting "gradual sustainable growth" of 3% to 4% over the next two to three years (Bernama, 07-Jun-2018). He stated: "Our aspiration is not only to turn around this airline but to make it grow. I am very cognisant that we cannot grow robustly like peers such as Cathay Pacific, Emirates and Etihad". Mr Izham also noted the strengthening of the ringgit does not benefit the airline in terms of sales in other currencies, commenting: "The strengthening of the ringgit benefits us locally but a lot of people fail to realise that it does not benefit us globally".

Malindo Air commenced (08-Jun-2018) daily Kuala Lumpur-Denpasar-Melbourne service with Boeing 737-800 equipment on 07-Jun-2018. Malindo Air is the third airline to operate between Bali and Melbourne and adds 118,260 seats p/a. Melbourne Tullamarine Airport chief of aviation Simon Gandy reported 8.6% p/a growth in passenger traffic between Victoria and Indonesia in the last five years. Mr Gandy said: "This highlights we are rapidly filling current capacity, the strong travel demand in the route and reinforces Victoria's fascination with the leisure hotspot". Melbourne Airport now offers up to 500,000 seats p/a on Indonesia routes, which Mr Gandy said demonstrates "the strength and resilience of the destination". [more - original PR]