80 AUSTRALIAN AVIATION
W
hen the news began to filter
through that Japan Airlines
(JAL) – still on the recovery
trail after its spectacular
A$33 billion bankruptcy in 2010,
the biggest collapse in the country’s
history – was intending to launch
a new low-cost carrier, eyebrows
were raised at Jetstar Japan’s base at
Tokyo’s Narita Airport. Initially, the
plan wasn’t clear. After all, JAL was
already the majority stakeholder in
Jetstar Japan with partner Qantas
Airways and it was now the biggest
budget operator in the Japanese
domestic market.
Jetstar management had no need to
worry. The new no-frills offering, yet
to be named, will launch in 2020 with
two Boeing 787 Dreamliners and its
target is economy-minded travellers
on medium to long-haul routes from
Asia, Europe and the Americas.
That, in fact, will be a help rather
than a hindrance to Jetstar. Why?
Because Qantas’s Japanese budget
sector pacesetter has a totally different
game plan from its rivals. While most
scramble to expand their international
networks, throwing more and more
capacity into big growth markets such
as China and India, Jetstar Japan has
a heavy focus on domestic operations.
That is where it continues to expand,
feeding not only on local traffic but
the growing number of inbound
tourists feeding onto its flights from
international destinations. Because
of that, JAL’s new LCC represents a
prospective traffic bonus rather than
a threat.
“If you look at us, especially
compared to some of the other LCCs
in the market, we’ve got the same
product but we’ve got different
strategies,” explains Australian Nick
Rohrlach, chief executive adviser and
executive director at Jetstar Japan.
“We have been very focused on
domestic. We just recently announced
a new route to Nagasaki. We opened
Miyasaki last year. We are opening
domestic ports much faster than we
are opening international and what we
are seeing is a lot of stimulation in the
secondary markets...we will definitelyhave more in that domestic sector.”
Rohrlach isn’t saying international
is not important but points out a
growing number of inbound tourists
are arriving into Japan and connecting
onto Jetstar for local flights.
“You look, especially during
Chinese New Year, all of our flights
are heavily focused on a lot of Chinese
tourists flying around domestically as
well. We play a role there in growing
these smaller cities. That’s been our
focus and I think that will be our
focus, certainly for the next few years.”
The strategy is clearly seen in its
network. While it has 12 domestic
destinations it has only four
international routes, to Manila, Taipei,
Hong Kong and Shanghai. The single
Chinese destination clearly delineates
it from rivals. Between them, for
example, ANA’s Peach and Vanilla
operate nearly 20 international routes.
Given that Japan’s internal air
traffic is mature – the country actually
has a declining population – Jetstar’s
strategy may seem strange. But it is
the inbound market that holds the‘JAL’s new LCC
represents a
prospective
traffic bonus
rather than a
threat.’
JAL’s new long-haul LCC will use
Boeing 787’s.ROB FINLAYSON