By KUNA
Tokyo : Asia’s second-biggest carrier All Nippon Airways Co. (ANA) plans to establish a low-cost airline in Asia as early as fiscal 2008, a major Japanese business daily reported Wednesday.
Given a tough business environment ahead, the Tokyo-based ANA expects competition from Asian budget carriers following expansions scheduled for 2010 at Haneda and Narita international airports in the capital area, the Nikkei Shimbun said.
ANA is considering creating the new firm as a joint venture with a Chinese or other Asian airline, while acquiring an existing airline will likely be an option, according to the Nikkei.
An Asian strategy office will be set up in Hong Kong next month to conduct market research and find a local partner. To differentiate itself in service and fares, the low-cost carrier is not expected to use ANA’s corporate name or brand. Flight crews will be hired locally to cut operating costs.
Budget carriers are increasing their presence in Asia. Singapore Airlines and Korean Air have each established low-cost subsidiaries. Jetstar Airways Pty., a unit of Australia’s Qantas Airways Ltd., in March 2007 began servicing a route connecting Sydney and Osaka, with round trips starting at JPY 50,000 (USD 500).
It has attracted customers by, for example, launching time-limited offers costing only JPY 40,000 (USD 400) for a round trip for two.
ANA’s budget airline is expected to offer prices low enough to compete with Jetstar and others.