ANA seeks overseas funds for discount carrier
By Taiga Uranaka |
August 3, 2010, Tuesday
|
Print Edition
Print Edition
JAPAN'S All Nippon Airways plans to seek investment from overseas airlines and investment funds to help set up a low-cost carrier which it aims to launch as early as next year, the Nikkei business daily said yesterday.
The move is ANA's response to growing competition from Chinese and South East Asian discount airlines that began flying to Japan after an "open skies" aviation agreement to liberalize civil aviation markets.
ANA plans to set up a low cost carrier that will offer flights at less than half the price of major carriers for international routes within six hours of Japan, according to the Nikkei.
The Japanese airline will likely take a 30-50 percent stake in the discount carrier which is expected to have an initial capital of more than 50 billion yen (US$578.4 million). Overseas airlines and funds will probably have a combined holding of less than 30 percent, the paper said.
Japan's second-biggest airline will also seek investment from Japanese travel agencies and hotels to offer wider services, the paper said, adding that the carrier would decide partners as early as next month.
ANA's President Shinichiro Ito told Reuters in April the carrier was "seriously considering" the possibility of starting a low-cost airline, although it would need to find airports that are open 24 hours a day and with low landing fees.
An ANA spokeswoman said there was no new information about its budget airline plans.
Low cost carriers have been on the increase throughout the world, but Japan has always been a difficult market due to higher labor costs, limited slot availability at key airports and expensive landing fees.
The Nikkei report said the new budget carrier would not operate under the ANA brand.
ANA shares jumped 3.07 percent to 302 yen yesterday, outperforming the benchmark Nikkei 225 average which rose 1.2 percent.
The move is ANA's response to growing competition from Chinese and South East Asian discount airlines that began flying to Japan after an "open skies" aviation agreement to liberalize civil aviation markets.
ANA plans to set up a low cost carrier that will offer flights at less than half the price of major carriers for international routes within six hours of Japan, according to the Nikkei.
The Japanese airline will likely take a 30-50 percent stake in the discount carrier which is expected to have an initial capital of more than 50 billion yen (US$578.4 million). Overseas airlines and funds will probably have a combined holding of less than 30 percent, the paper said.
Japan's second-biggest airline will also seek investment from Japanese travel agencies and hotels to offer wider services, the paper said, adding that the carrier would decide partners as early as next month.
ANA's President Shinichiro Ito told Reuters in April the carrier was "seriously considering" the possibility of starting a low-cost airline, although it would need to find airports that are open 24 hours a day and with low landing fees.
An ANA spokeswoman said there was no new information about its budget airline plans.
Low cost carriers have been on the increase throughout the world, but Japan has always been a difficult market due to higher labor costs, limited slot availability at key airports and expensive landing fees.
The Nikkei report said the new budget carrier would not operate under the ANA brand.
ANA shares jumped 3.07 percent to 302 yen yesterday, outperforming the benchmark Nikkei 225 average which rose 1.2 percent.
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