Asian budget carrier Jetstar Japan will launch international flights from February 2015 and has selected its Osaka’s Kansai International Airport base as the initial location for its foreign operation. The carrier will open a three times daily service between Osaka and Hong Kong from February 28, 2015, growing to a daily schedule at a later date.
The carrier launched domestic operations in July 2012 and has its main operational base at Tokyo Narita, but is believed to feel it can generate a better penetration of its international activities and develop enhanced synergies with the wider Jetstar Group from Osaka, where it opened a secondary base in June 2014.
“The announcement of international services is a very positive next step in the evolution of our presence in Japan as the country’s largest low cost carrier,” said Miyuki Suzuki, chief executive officer, Jetstar Japan. “Just like low fares have transformed how Japanese consumers travel domestically, we are excited to stimulate new travel demand to Japan from Hong Kong and provide our Japanese customers new international options.”
Jetstar Japan will operate a fleet of 20 A320 aircraft by the end of 2014 and currently serves eleven domestic points in the country with more than 100 flights daily. The carrier is now the second largest Jetstar branded airline in the Group after Jetstar Airways in Australia and is on track to carry seven million passengers by the end of this year.
“Just like low fares have transformed how Japanese consumers travel domestically, we are excited to stimulate new travel demand to Japan from Hong Kong and provide our Japanese customers new international options.”Miyuki Suzuki
Chief Executive Officer, Jetstar Japan
According to Suzuki, the new Hong Kong service builds on the international network of other Jetstar branded airlines operating to Japan. “Japanese travellers have embraced low fares travel domestically since our launch in 2012. Internationally, LCCs only represent 4.4 per cent of the market showing us there is a lot of room for international services to grow,” she said.
Kansai International Airport was the first international Japanese destination for the Jetstar Group with Jetstar Airways commencing services from Queensland to the city in 2007. Currently Jetstar Airways operates services from Cairns and the Gold Coast to Kansai, while Jetstar Asia operates services to Kansai from Singapore via Taipei and Manila.
Jetstar Airways also operates international services from Tokyo (Narita) to the Gold Coast, Melbourne and Cairns, while Jetstar Asia also operates up to three daily services between Singapore and Hong Kong. A local company Jetstar Hong Kong is also awaiting regulatory approval to establish low-cost operations from Hong Kong International Airport.
Jetstar Japan is a joint venture between major shareholders Qantas Group and Japan Airlines as well as Mitsubishi Corporation and Century Tokyo Leasing Corporation. Qantas recently announced an enhanced codeshare with the business, which from mid-January will see Jetstar Japan’s destinations in Japan - Sapporo, Fukuoka, Oita, Okinawa, Osaka, Takamatsu, Matsuyama, Kumamoto and Kagoshima – added to Qantas flight itineraries.
Ms Suzuki said international services will make an important contribution to the strengthening of the carrier’s operations and financial performance. Jetstar Japan has increased its share of capacity in the Japanese domestic market from 2.2 per cent in 2013 to 3.4 per cent in 2014. However, when you look at just the country’s low-cost operations this share increases to a dominant 60 per cent share of this niche.
The Osaka – Hong Kong market is currently served by All Nippon Airways, Cathay Pacific Airways and low-cost operators HK Express and Peach Aviation, while Air India serves the market as a continuation of flights from India. An estimated 901,000 passengers flew between Osaka’s Kansai International Airport and Hong Kong International Airport in the first nine months of 2014, with bi-directional O&D demand accounting for around 753,000 of these passengers.
In our analysis, below, we highlight segment demand between Osaka Kansai and Hong Kong International by airline.