Spring Airlines Japan [IJ/SJO] reported a 4.92 billion JPY loss for 2014. Total revenue was 836 million JPY, operating loss stood at 4.89 billion JPY, while its ordinary loss was 4.94 billion JPY. In December, largest shareholder Spring Airlines [9Q/CQH] injected 900 million JPY in the form of third-party allocation of non-voting stocks, raising total capital to 6.9 billion JPY (Spring Japan receives 900 million JPY injection.). The Japanese unit of China's biggest LCC only started operations last August (Spring Airlines Japan commences operations.).
From its Tokyo/Narita [NRT/RJAA] hub using a small fleet of three 189-seat Boeing 737-800s, Spring Japan currently flies double-daily to Hiroshima [HIJ/RJOA], daily to Saga [HSG/RJFS], and four times weekly to Takamatsu [TAK/RJOT]. These secondary routes are still unprofitable, except maybe for Hiroshima. On April 8th, it moved into Narita's Terminal 3, which is dedicated for LCCs (Narita opens Tokyo's LCC gateway: Terminal 3.).
Japan's youngest operating LCC has talked of launching international flights to China by the end of this year (Spring Japan cuts flights but hopeful for China in 2015.) with Chongqing [CKG/ZUCK], Lanzhou [LHW/ZLLL], and Wuhan [WUH/ZHHH] to become its initial destinations (Spring Japan considering Chongqing and Wuhan.). In addition, parent Spring Airlines' CEO Zhang Xiuzhi revealed in March that Hong Kong, Macau, South Korea, Taiwan, and Southeast Asia are also on Spring Japan's radar, with Osaka/Kansai [KIX/RJBB] and Sapporo/New Chitose [CTS/RJCC] (Spring Japan eyes Sapporo and China in 2015.) on the wishlist for domestic cities.
However, Spring Japan's original mission had been to tap into secondary Chinese cities catering to mostly Chinese tourists traveling to Japan, with much less emphasis on Japan's domestic market. And with parent Spring Airlines now setting up its own hub at Kansai, envisioning 100 weekly flights serving 20 Chinese cities and basing 10 aircraft by 2020, they may not feel the need to tolerate the Japanese unit's red ink after all, especially if they deem the domestic market unimportant. System-wide average booking rate for the upcoming Golden Week peak travel period is a pale 57.6% so far. Will Spring Japan be able to live up to its ambitions?
Source: Aviation Wire, March 3rd. (in Japanese)
Source: Aviation Wire, April 8th. (in Japanese)
Source: Spring Airlines Japan, April 24th. (in Japanese)
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| Boeing 737-86N(WL) JA02GR taxies for departure from Narita. Original plans called for adding five new aircraft each year to reach 20 by 2017, however, all new deliveries seem to have been postponed indefinitely. (Photo: Aviation Wire) |
From its Tokyo/Narita [NRT/RJAA] hub using a small fleet of three 189-seat Boeing 737-800s, Spring Japan currently flies double-daily to Hiroshima [HIJ/RJOA], daily to Saga [HSG/RJFS], and four times weekly to Takamatsu [TAK/RJOT]. These secondary routes are still unprofitable, except maybe for Hiroshima. On April 8th, it moved into Narita's Terminal 3, which is dedicated for LCCs (Narita opens Tokyo's LCC gateway: Terminal 3.).
Japan's youngest operating LCC has talked of launching international flights to China by the end of this year (Spring Japan cuts flights but hopeful for China in 2015.) with Chongqing [CKG/ZUCK], Lanzhou [LHW/ZLLL], and Wuhan [WUH/ZHHH] to become its initial destinations (Spring Japan considering Chongqing and Wuhan.). In addition, parent Spring Airlines' CEO Zhang Xiuzhi revealed in March that Hong Kong, Macau, South Korea, Taiwan, and Southeast Asia are also on Spring Japan's radar, with Osaka/Kansai [KIX/RJBB] and Sapporo/New Chitose [CTS/RJCC] (Spring Japan eyes Sapporo and China in 2015.) on the wishlist for domestic cities.
However, Spring Japan's original mission had been to tap into secondary Chinese cities catering to mostly Chinese tourists traveling to Japan, with much less emphasis on Japan's domestic market. And with parent Spring Airlines now setting up its own hub at Kansai, envisioning 100 weekly flights serving 20 Chinese cities and basing 10 aircraft by 2020, they may not feel the need to tolerate the Japanese unit's red ink after all, especially if they deem the domestic market unimportant. System-wide average booking rate for the upcoming Golden Week peak travel period is a pale 57.6% so far. Will Spring Japan be able to live up to its ambitions?
Source: Aviation Wire, March 3rd. (in Japanese)
Source: Aviation Wire, April 8th. (in Japanese)
Source: Spring Airlines Japan, April 24th. (in Japanese)
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