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A New Low-Cost International Airline Is Coming, And It Will Fly to the US

May 14, 2018
3 min read
A New Low-Cost International Airline Is Coming, And It Will Fly to the US
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Japan Airlines announced on Monday it wants to launch a low-cost carrier, offering medium- and long-haul flights for cheap. JAL follows a trend set by European airlines that have started low-cost, long-haul divisions, such as British Airways and Iberia with Level and Air France with Joon.

Exact details remain scarce — even the name of the airline. However, JAL did say that its new low-cost carrier will be based at Tokyo's Narita Airport (NRT) and will offer flights to the Americas, Asia and Europe. The still-to-be-named airline is expected to launch in the summer of 2020 with two Boeing 787-8 aircraft.

According to Reuters, JAL will invest 10 billion to 20 billion yen ($91 million to $183 million) in the new low-cost business. Within three years of launch, JAL is aiming for the LCC to reach profitability.

The new LCC will tap into Japan's underserved low-cost market, which only covers about 10% of travel within Japan, according to the Japan Times. The country's airspace is dominated by full-service carriers, such as JAL itself and All Nippon Airways, or ANA. The growth of low-cost travel in the country has been slow to come by, in part, because of its extensive high-speed rail network.

However, Asia's aviation market and its growing demands have led to airlines aiming to capitalize on travelers who want low prices. In the next few years, low-cost carriers are expected to operate about 30% of flights within Japan — on par with the offerings in other parts of the world.

In March, Japan's largest airline ANA announced that it will launch medium-haul international flights under the Peach brand name. Flights could operate as far as India.

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While the new airline will be JAL's first venture of its own into the low-cost market, the airline, Japan's second biggest, already has some experience. Currently, JAL holds a minority stake in Jetstar Japan, though that operates only narrow-body aircraft within the region. JAL said it plans to continue that investment even after its own LCC launches. Jetstar Japan has given its approval for JAL to launch its own LCC, hoping to connect the new airline's longer-haul operation to its short-haul domestic network.

JAL currently operates 25 Boeing 787-8 Dreamliners, the smaller version of the twin-aisle jet. It still has four 787-8s on order that have yet to be delivered. By the time the airline's new low-cost venture is set to begin operation in summer 2020, it will be just in time for Tokyo to host the summer Olympics.

Featured image by JT Genter