Cheap flights to Tokyo by Air Asia may start price war

Malaysia’s AirAsia, the first international budget carrier to fly to Tokyo’s Haneda airport, plans to kick off service with US$58 (S$77) flights to Tokyo – Kuala Lumpur and said it could expand to three more Japanese airports.In a move that could pour fuel on increasing price competition over Japan’s skies, the 5,000 yen flights are on offer from December until July next year, after which prices will start at 10,000 yen (S$155), with premium lie-flat seats costing 48,000 yen.

That compares with current prices of around US$650 to US$2,000 for the same route from airlines such as Japan Airlines, All Nippon Airways, Malaysian Airline System Bhd and Cathay Pacific.

The pricing comes on the heels of tickets between Shanghai and Japan’s Ibaraki airport, 85 km north of Tokyo, for as little as 4,000 yen from China discount carrier Spring Airlines.Until recently, low-cost airlines had found it difficult to expand to Japan due to high labour costs and limited slot availability at key airports.

But Haneda, which is closer to central Tokyo than Narita International, Japan’s major international airport, will open a fourth runway next month while a new “open skies” pact will cut government restrictions on airlines to flying in and out of Japan.

“The power of Haneda is its very strong domestic network, with dozens of flights to Sapporo, Osaka, Fukuoka … and its very central location thanks to which it already has a strong cargo operation that we can tap,” Azran Osman-Rani, chief executive of AirAsia X, the carrier’s long-haul unit.

“We could operate in at least three different airports in Japan, just give us a couple of years as airports like Fukuoka, Osaka and Sapporo are all places that we have a strong interest in,” he added.

The Tokyo-Kuala Lumpur flights will use Airbus A330 aircraft and the company hopes to eventually offer flights daily from an initial three per week.

The incursions by budget carriers into the Japanese market have prompted Japan’s No.2 carrier All Nippon Airways to announce a plan this month to start a low cost carrier to fly between Japan and China in partnership with Hong Kong-based private equity firm First Eastern Investment Group.Japan Airlines has also said it would look at creating a low-cost carrier.

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