Peach Aviation and Vanilla Air to merge to create one powerhouse LCC

posted on 22nd March 2018 by Jordan Newton
Peach Aviation and Vanilla Air to merge to create one powerhouse LCC

Japanese low-cost carriers (LCC) Peach Aviation and Vanilla Air have joined forces and owner ANA Holdings is targeting the two merged airlines becoming the “leading LCC in Asia”.

Peach owner ANA Holdings said the full integration of its two subsidiary airlines, Peach and Vanilla, is planned to start in the second half of the 2018 financial year (FY), with the target to be completed by the end of the FY2019, with Peach being designated as the basis of the integrated airline.

ANA is targeting beyond FY2020, the airline planning on having more than 50 aircraft operating on more than 50 routes, up from the 35 aircraft today and the 39 routes now served and said the move positions them for future growth.

ANA said following the integration, the airline will serve as a strong foundation for further fleet growth and network expansions from Osaka Kansai Airport as well as from Tokyo Narita Airport.

In addition, ANA said the airline will stimulate potential demand in Japan and from abroad through attractive service, various innovations and fares that exceed expectations.

Peach Aviation started its operations from Osaka Kansai Airport in March 2012 while Vanilla Air started its operations from Tokyo Narita Airport in December 2013.

ANA continued: “The integration will combine and further enhance the strengths the two LCCs have today, and will create a stronger competitive advantage to further promote not only the Japan domestic service, but also capture the strong demand for visitors to Japan.

“By FY2020, the integrated LCC plans to enter the mid-haul LCC market to aggressively incorporate the growing travel demand in Asia, and will also contribute to the Japanese government’s goal of 40 million people visiting Japan in 2020.”

The target revenue of 150 billion Japanese yen and an operating profit of 15 billion Japanese yen for FY2020, the strategy will contribute to increased operational efficiency and reduction of unit costs.

ANA group will maintain the strategic independence of the integrated LCC, and position the airline as an important pillar for greater profits and new opportunities for future expansion, and its aim in becoming the leading LCC in Asia.

Meanwhile, Vanilla has announced it is to start a new Airbus A320 route between Narita Airport and the island of Ishigaki starting 1 July 2018 and ending on 27 October.

The carrier now serves four overseas cities (Taipei, Kaohsiung, Hong Kong, Cebu) and five Japanese airports (New Chitose, Hakodate,Kansai, Amami, Naha). With the new Vanilla service to Ishigaki, Narita Airport will have domestic routes serving 20 airports in 19 cities.

Vanilla will also suspend operations from Narita to Osaka Kansai from 6 June this year and said future operation planned for this service will be announced as soon as it is finalised.

The ANA Group carried 52.1 million passengers in FY2016, has approximately 39,000 employees and a fleet of 260 aircraft. ANA is the biggest operator of the Boeing 787 Dreamliners.