Qantas, Jetstar & Japan.

[Montague S]

looks like some interesting developments on the Japanese front...huge drop in visitor numbers too! I can honestly say that Japan is far cheaper for a holiday than Australia so I can understand why they are not coming here. what I do find strange is Qantas barking on about LCC's yet they have been instrumental in their success in the Asian market.

QANTAS has hinted that it could replace its remaining services to Japan with Jetstar flights, after warning the growth of low-cost airlines in Asia would "increase pressure on the viability of the Japan route in the medium to longer term".

In an application to the International Air Services Commission (IASC), seeking a two-year extension of its current code share agreement with Japan Airlines, Qantas said it was "almost certain" that it would cut services to Japan if the deal was not renewed.

However, even if the agreement was approved, Qantas failed to give any assurances that it would maintain it current level of flights into Australia's third biggest market for inbound tourists.

In its application to the IASC, Qantas warned the emergence of low-cost airlines such as AirAsia, Tiger and Japan's Skymark was "likely to increase pressure on Australia's market share of Japanese tourists".

Qantas also failed to rule out switching flights to Tokyo with its low-cost Jetstar.

Despite the code-share allowing it effectively to share capacity with its only direct competitor on the route, Qantas said it was "sustaining siginificant losses", highlighting the impact of high fuel prices and the strong dollar on Japanese demand.

According to tourism industry lobby group TTF Australia, arrivals from Japan fell 17.6 per cent in the year to March.

The current deal was expanded in 2006, when Japan Airlines stopped its flights into Melbourne from Tokyo and decided to code-share with Qantas on the route. Since then, Qantas has replaced its services to Osaka and Nagoya with Jetstar, which forged a code-share with JAL last year.

Jetstar declined to reject speculation it could eventually fly to Japan via its new Darwin hub with narrow-body jets.

"The range of the A320 or the A321, without payload restrictions, you're looking at five to six hours," said Jetstar spokesman Simon Westaway. "That arc does cover a lot of exciting … markets that we could serve in the future," he said. Jetstar already flies to Singapore from Darwin twice daily.

The longer-range A321 could easily reach most Japanese cities from Darwin.

There is even talk Qantas could use its part-owned Vietnamese budget subsidiary, Pacific Airlines, to carry tourists between Australia, Japan and other major Asian tourism markets via its Ho Chi Minh hub.

http://business.smh.com.au/qantas-ke...0512-2deh.html

[Steve Jones]

Skymark? Are they looking at Australia?

[Brendan Lawrence]

Well that's a shame about the dropping numbers on the Japanese front, in regards to Qantas services anyway.

I'm sure many enthusiasts and the premium flyers amongst you would be unhappy about Qantas withdrawing full-service flights on the NRT routes but as a Jetstar flighty this makes me very happy with the possibility of new destinations I could potentially fly to!

Would rather get there on a 330 mind you ... The 320 can feel a bit tight just on the MEL-DRW haul. I suppose if this is as a result of dropping pax numbers then better to send a close to full 320 than a scarcely populated 330 - from a business/viability point of view.

[Montague S]

funny thing is that you can drop QF and replace it was JQ but it won't improve the numbers...Japanese won't come here because its here where its hurting their hip-pocket, not the airfares.

[Will T]

The application itself provides an interesting overview of the Japan market, and is worth reading.

http://www.iasc.gov.au/pubs/iascpp4311.pdf

How things have changed from the 1990s!