Airbus seeks alliances in Japan’s growing low cost market

2 years ago by in Travel

f76bd18b2512cb33bb87c501ad77348d1 Airbus seeks alliances in Japans growing low cost market

The European aircraft maker Airbus is looking at ways to win market share in Japan by taking advantage of opportunities created in the budget segment of the market.

Rival Boeing has already established a powerful position through its alliance with carriers All Nipon Airways and Japan Airlines, but Airbus is now eyeing Japan’s growing low cost market.

"In the short term, this (strategy) could let us significantly increase our market share," said Stephane Ginoux, chief executive of Airbus’ Japanese unit. "Within two years, we can see significant results because the low-cost airline model is undergoing a rapid rise, with lots of aeroplanes."

The low cost operators cover only 5 percent of the total market in Japan, significantly less than in Europe (35 percent) or the U.S. (29 percent). But the growing prospects are interesting enough for Airbus.

"The low-cost airlines in Japan will not take away market share from the established airlines, but they’ll create a new market from people who don’t fly right now," said Kiran Rao, executive vice president of sales and marketing at Airbus.

Japan will need 600 new airplanes over the next 20 years, and new operators will probably order half of those, Rao added.