Japanese carrier All Nippon Airways is making plans to launch a new low cost carrier in Japan. The company is being set up later this year with domestic and international flights scheduled to start in 2011 out of Kansai International Airport in Osaka.
This project is in collaboration with First Eastern Group out of Hong Kong. The new low cost airline has the potential to make air travel within Japan lower than the cost of taking the bullet train.
The Japanese media has reported that routes like Tokyo to Osaka could become as inexpensive as 5,000 yen (around $60) which is $110 less than the same trip on the bullet train at 14,000 yen. Plane fare from Osaka to Okinawa could be 8,000 yen (less than $100), which now costs around 34,000 yen or $400.
Government controls regarding air travel are very strict, which is why low-cost carriers are such a novelty in Japan. They are easing up on regulations and carriers like Air Asia are launching new routes into Japan. Air Asia just opened up sales for their brand new route to Tokyo, scheduled to start in December.
"We anticipate an increase in passenger traffic demand in East Asia, and came to the conclusion that a low-cost carrier would be the right approach to compete effectively in this market," said Shinichiro Ito, ANA president and chief executive.
ANA's new low cost carrier will be run independently from ANA itself, with 66.7% owned by Japanese investors, including a 39% stake by ANA, and Hong Kong's First Eastern will have 33.3% ownership.
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