The Wall Street Journal
By Joanne Chiu
Dec. 27, 2013 1:46 a.m. ET
HONG
KONG—Japan's civil aviation regulator has approved the launch of Spring
Airlines Co.'s budget-carrier joint venture in the country, clearing a
major hurdle for the Chinese airline as it prepares for a May 2014
launch.
Spring Air's plan to set up a low-cost venture in Japan
would give China's biggest budget carrier by revenue more access to the
Japanese market, but it comes as political tensions between the nations
continue to linger.
The venture couldn't come at a worse time, as
the China-Japan territorial spat stifles demand for business and
leisure travel between the two countries. Spring Air had planned to
start its low-cost venture in Japan last year, but the plan was delayed
because of the dispute.
The number of Chinese tourists to Japan
fell 21% in the first nine months of this year to 1.3 million, while
Japanese visitors to China are down 24% during the same period. On
Thursday, a surprise visit by Japanese Prime Minister Shinzo Abe to a
shrine linked to the nation's militarist past threatens to further
impact diplomatic relations with China and hurt demand for travel
between the two countries, say analysts.
Spring Air Japan Co.
said Thursday it received approval for the Tokyo-based airline last
week, and will launch twice-daily flights between Narita Airport near
Tokyo and the cities of Takamatsu and Saga from the end of May. It is
also planning flights between Narita and Hiroshima.
While Spring
Air hopes to link connecting traffic from China through the Narita hub,
it has been unable to secure rights to fly there from its Shanghai base,
a route that for years has been dominated by state-owned rival China
Eastern Airlines Corp.
Spring Air in China
now operates international services connecting Shanghai with the
Japanese cities of Saga in the southwest, Takamatsu in the west and
Ibaraki, northeast of the capital, as it awaits rights to fly to Tokyo,
underscoring the difficulties the carrier faces as it competes with
China's large established airlines.
The airline would also face stiff competition from other budget carriers, such as Jetstar Japan and Peach Aviation.
Spring
Air Japan, 33% of which will be owned by the Shanghai-based carrier,
said earlier it would add more domestic and international services to
China later.
The rest of the new airline will be controlled by a
group of Japanese investors in the private-equity, travel and
information-technology industries, according to Spring Air, which has
declined to disclose further details.
Spring Air Japan hopes to
boost its fleet size to around 20 Boeing Co. 737-800 jets, which can
each seat 189 passengers, five years after it starts service with three
planes, the carrier said earlier.
Source: http://online.wsj.com
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