New AirAsia Japan takeoff slipping to Summer 2016?

Effective December 1st, AirAsia Japan [DJ] revamped its board by essentially relegating CEO Yoshinori Odagiri to Adviser, a largely ceremonial position, and instead promoting CFO Osamu Hata to CEO and hiring bankrupt Skymark Airlines' [BC/SKY] former Chairman Takashi Ide as Chairman and former President Masakazu Arimori as CFO (AirAsia Japan CEO to quit, ex-Skymark executives coming.). But what made AirAsia Group swap management during such important times when it is preparing to launch operations?

Airbus A320-216(SL) JA01DJ/F-WWBV seen before delivery. It was handed over to AirAsia Japan on October 9th, and arrived at Japan on October 16th. Their second aircraft, to be adorned with a special livery designed by Mika Ninagawa, will be delivered in February. (Photo: Tobias Gudat)

Reportedly, there was unmendable distrust between James Rhee, North Asia CEO for the AirAsia Group, and Mr. Odagiri. Japan's fifth LCC had been set back with a nine-month delay (AirAsia Japan is officially reborn; first flight June 2015.), largely due to shifting strategy to focus more on the international market rather than domestic, difficulties in recruiting pilots and setting up a maintenance scheme, and much-longer-than-anticipated preparation to apply for an Air Operator's Certificate (AOC), which it received on October 6th (New AirAsia Japan receives AOC; takeoff in April 2016.). But without Mr. Odagiri's strenuous yet patience-necessary talks with regulator Japan Civil Aviation Bureau (JCAB), AirAsia Japan could not have obtained it. However, Mr. Rhee could not wait any longer.

On the other hand, Mr. Hata, who previously worked as CEO for Dell Japan, does not have any experience in the airline industry, let alone a unique market like Japan. So talks to headhunt the former Skymark duo reportedly started as early as late September, when they withdrew from Japan's embattled third largest airline after sponsors Integral Corporation and ANA Holdings installed a new board (Skymark relaunched with ANA sponsorship.). Mr. Ide and Mr. Arimori had maintained both official and personal relationships with Mr. Fernandes; the first AirAsia Japan (Mk I) was originally planned to be a joint-venture (JV) with Skymark until ANA stepped in, while AirAsia Group bid to sponsor Skymark (ANA and AirAsia bid to save Skymark.), and at one time Mr. Ide envisioned merging Skymark with the new AirAsia Japan in the long-term. But all of this was politically difficult as Skymark held 36 precious slot-pairs at heavily-regulated Tokyo/Haneda [HND/RJTT] (AirAsia admits Skymark bid defeat, Japan unit delay to 2016.).

Meanwhile, its first aircraft, Airbus A320-216(SL) JA01DJ, which had arrived on October 18th (New AirAsia Japan receives first Airbus A320.), remained dormant at Nagoya/Chubu Centrair [NGO/RJGG], as the airline still did not have a working maintenance team. The aircraft's battery died and its auxiliary power unit (APU) went out of order, and it was not able to have an engine run-up until early December. Training flights were expected by November, but that too has been pushed back to at least January. It is widely believed that its current April 2016 in-service target could be missed by several months. Sources close to the matter also point out that it has already used almost half of its initial 7 billion JPY capital, and cash injections are likely necessary as it takes delivery of its second A320 in February and more employees come on-line.

Can the ex-Skymark duo guide AirAsia Japan? They have wide and deep knowledge of the domestic market and expertise in running a low-cost operation in Japan's unique economic and regulatory environment, however, that said Skymark's success centered around its prized slots at Haneda while AirAsia Japan is based at Chubu Centrair, and Skymark has been a purely domestic carrier while AirAsia Japan plans to allocate at least 55% of its capacity to international. And there is reportedly already looming distrust between employees and the new management, and rumors point out Mr. Hata may be leaving the airline as well.

AirAsia Japan is a stepping stone for the AirAsia Group to expand its network to North America, and also has the potential to bring true (non-ANA/JAL) competition back to Japan. Hopes are still high AirAsia Japan would keep Mr. Fernandes' words, "This is Part 2 of AirAsia Japan's performance, and it will be the last. There won't be a third."

Source: Diamond Online, 2015 December 7th. (in Japanese)
Source: Aviation Wire, 2015 December 16th. (in Japanese)
Source: Aviation Wire, 2015 December 17th. (in Japanese)

AirAsia Japan CEO to quit, ex-Skymark executives coming.

New AirAsia Japan [DJ] has announced that effective December 1st, CEO Yoshinori Odagiri will resign and Chief Financial Officer (CFO) Osamu Hata, formerly with Dell Japan, will be promoted to succeed the role. AirAsia Group has also confirmed that on the same date, ex-Skymark Airlines' [BC/SKY] executives will join the board, including former Chairman Takashi Ide and President Masakazu Arimori, both of whom stepped down from Japan's bankrupt third largest airline (Skymark to file for bankruptcy.) after a new management was installed by ANA Holdings, parent of All Nippon Airways [NH/ANA], and Integral Corporation (Skymark relaunched with ANA sponsorship.).

New AirAsia Japan's CEO Yoshinori Odagiri (center) poses in front of their maiden aircraft Airbus A320-216(SL) JA01DJ at Chubu Centrair after delivery on October 16th. Osamu Hata will be promoted to CEO while ex-Skymark Airlines Takashi Ide will play the representative role of Chairman. (Photo: Aviation Wire)

AirAsia Group started courting the duo not long after Skymark's board was revamped effective September 29th. They had maintained both official and personal relationships with AirAsia Group CEO Tony Fernandes, and at one time Mr. Ide even envisioned handing Skymark control to Asia's largest LCC group in the long term (ANA and AirAsia bid to save Skymark.). Mr. Ide will become Chairman and Mr. Arimori will become CFO, taking the place of Mr. Hata. The duo has wide and deep knowledge of the domestic market and expertise in running a low-cost operation in Japan's unique economic and regulatory environment. That said, Skymark's success centered around its 36 slot-pairs at regulated Tokyo/Haneda [HND/RJTT] while AirAsia Japan is based at Nagoya/Chubu Centrair [NGO/RJGG], and Skymark has been a purely domestic carrier while AirAsia Japan plans to allocate at least 55% of its capacity to international.

Mr. Odagiri, who also served as CEO with the first AirAsia Japan [JW/WAJ] (CoachFlyer JW8541: NRT - FUK on AirAsia Japan's Airbus A320.), will become Adviser. Although no reason has officially been given, the former ANA veteran is likely stepping down due to conflict of ideas within the board on how the new Japanese unit would be run. Having been founded in July 2014, Japan's fifth LCC has been set back with almost a year's delay in launching operations (AirAsia Japan is officially reborn; first flight June 2015.), largely due to shifting strategy to focus more on the international market rather than domestic, difficulties in recruiting pilots and setting up a maintenance scheme, and much-longer-than-anticipated preparation to apply for an Air Operator's Certificate (AOC), which it obtained on October 6th (New AirAsia Japan receives AOC; takeoff in April 2016.).

In terms of voting rights, the new AirAsia Japan is owned by AirAsia Investment 33%, Rakuten 18%, Noevir Holdings 18%, Alpen 18%, and FinTech Global Trading 13%. Having received an AOC, it took delivery of its first Airbus A320 on October 9th (New AirAsia Japan receives first Airbus A320.) and revealed that operations would start in April 2016 from their Chubu Centrair hub to Sapporo/New Chitose [CTS/RJCC], Sendai [SDJ/RJSS] (New AirAsia Japan mulls Nagoya – Sendai.), and Taipei/Taoyuan [TPE/RCTP]. The original AirAsia Japan ceased operating in October 2013 after the Malaysian parent terminated the joint-venture (JV) with partner ANA due to managerial differences. It has since been relaunched as Vanilla Air [JW/VNL] under full ANA control (Vanilla Air launches operations.).

Source: Aviation Wire, 2015 November 27th. (in Japanese)
Source: Nikkei Shimbun, 2015 November 28th. (in Japanese)
Source: Asahi Shimbun, 2015 November 29th. (in Japanese)
Source: Aviation Wire, 2015 November 30th. (in Japanese)

*Edited/updated on November 30th.  

New AirAsia Japan receives first Airbus A320.

On October 16th, AirAsia Japan's (Mk II) [DJ] first aircraft, Airbus A320-216(SL) JA01DJ (MSN 6706), arrived at its hub at Nagoya/Chubu Centrair [NGO/RJGG]. Japan's newest airline had taken delivery of the airplane on October 9th. It departed Toulouse/Balgnac [TLS/LFBO] on October 14th and touched down at the main airport serving Nagoya at 1248 JST on October 16th, after making fuel stops at Cairo [CAI/HECA], Muscat [MCT/OOMS], and Yangon [RGN/VYYY]. As with other AirAsia-branded carriers' A320s, the airframe is configured with 180 seats.

Airbus A320-216(SL) JA01DJ receives a traditional water-cannon salute upon arriving at Nagoya' Chubu Centrair and passing by the prototype Boeing 787 Dreamliner donated to the airport. AirAsia Japan's (Mk II) second aircraft, which is planned for delivery in February 2016, will wear a special livery designed by photographer and film director Mika Ninagawa. (Photo: Aviation Wire)

The reincarnation of AirAsia's Japanese unit received its Air Operator's Certificate (AOC) on October 6th (New AirAsia Japan receives AOC; takeoff in April 2016.) and will launch operations in April 2016 initially serving three cities from Chubu Centrair; Sapporo/New Chitose [CTS/RJCC], Sendai [SDJ/RJSS] (New AirAsia Japan mulls Nagoya – Sendai.), and Taipei/Taoyuan [TPE/RCTP]. All will launch with double-daily frequencies, and details of the schedule will be released in late November when tickets will go on sale. Its fleet will start with two A320s, then quickly build up to six by year-end 2016, and see five additions each year after that to reach 11 by 2018, 16 by 2019, and at least 20 by 2020, when the Tokyo Olympics/Paralympics take place.

"Chubu's 24-hour operation is very attractive as it enables us to add red-eye or early morning flights, thus helping to increase aircraft utilization. The A320 can fly up to 4.5 hours, so all of Japan is covered and Korea, China, Taiwan, Guam, and Saipan are all within reach. Although we aren't in the position to disclose our fourth city, we will actively be adding new destinations in the first five years with a little more emphasis on international than domestic," said CEO Yoshinori Odagiri in a press conference at their RedBase headquarters following delivery, adding "Nagoya is one of Japan's three biggest metropolitan regions along with Tokyo and Osaka, and with Aichi being an industrial area, its population has been increasing. Until now, many have used airports in Tokyo or Osaka to travel beyond, but we would like to create more options from Chubu." The airline is aiming to produce its first full-year profit for FY2018.

Flight attendants of the new AirAsia Japan (Mk II) pose inside brand-new Airbus A320-216(SL) JA01DJ at Chubu Centrair. Crew training flights using the aircraft are expected to start as early as November. (Photo: Aviation Wire)

"We can be flying at least 120 flights in and out of Chubu by 2020," enthused Mr. Odagiri, adding "If we have 20 airplanes and each of them fly six flights (three round-trips) that adds up to 120. If we can have them fly eight legs, the figure would be greater." Aircraft-movement-wise, All Nippon Airways [NH/ANA] is currently the biggest carrier at Chubu Centrair with approximately 90 daily departures and arrivals, and AirAsia Japan's (Mk II) ambition exceeds that. Their next domestic city is expected to be Fukuoka [FUK/RJFF], with all near-term domestic additions to be in Hokkaido, Tohoku (Northeastern Japan), and Kyushu, where it would not need to compete with the super-efficient Shinkansen (Japanese bullet train). For international, coastal cities of China that are already served by AirAsia Group carriers are currently being closely looked at.

Chubu Centrair is planning to restart construction of a LCC terminal, with decision to be made by the end of the year. Mr. Odagiri said "We are currently talking with airport officials about how the terminal should look like including design and features. We hope they will go ahead with it, and we plan on moving there by 2018." The original plan was shelved when the first AirAsia Japan (Mk I) [JW/WAJ] halted operations in 2013, however, demand for a LCC-dedicated facility is increasing, with not only AirAsia Japan (Mk II) but also Chinese LCC Spring Airlines [9C/CQH] building a hub at Chubu Centrair. Other LCCs serving the airport include Cebu Air [5J/CEB] (d.b.a. Cebu Pacific), Hong Kong Express Airways [UO/HKE] (d.b.a. HK Express), Jeju Air [7C/JJA], and Jetstar Japan [GK/JJP], while V Air [ZV/ZAX] is starting in December.

In terms of voting rights, the new AirAsia Japan (Mk II) is owned by AirAsia Investment 33%, Rakuten 18%, Noevir Holdings 18%, Alpen 18%, and FinTech Global Trading 13%. It was founded in July 2014 (AirAsia Japan is officially reborn; first flight June 2015.) after the original AirAsia Japan (Mk I) (CoachFlyer JW8541: NRT - FUK on AirAsia Japan's Airbus A320.) stopped flying in October 2013 when the Malaysian parent terminated the joint-venture (JV) with partner ANA Holdings due to managerial differences. With the latter controlling 66%, everything needed to have consent from ANA, whose true interest was to tame AirAsia to protect the lucrative domestic market. That company now operates as Vanilla Air [JW/VNL] (Vanilla Air launches operations.) under 100% ANA control. This time around, AirAsia Japan (Mk II) will be making decisions on its own.

Source: Aviation Wire, 2015 October 16th. (in Japanese)
Source: Nikkei Shimbun, 2015 October 16th. (in Japanese)
Source: Aviation Wire, 2015 October 16th. (in Japanese)
Source: MyNavi, 2015 October 16th. (in Japanese)
Source: Nikkei Shimbun, 2015 October 17th. (in Japanese)
Source: Yomiuri Shimbun, 2015 October 17th. (in Japanese)

New AirAsia Japan receives AOC; takeoff in April 2016.

On October 6th, AirAsia Japan (Mk II) [DJ] was officially granted an Air Operator's Certificate (AOC) from Japan's Ministry of Land, Infrastructure, Transport, and Tourism (MLIT). It had filed an application on July 21st (AirAsia Japan confirms Spring 2016 launch from Nagoya.). Japan's newest LCC will launch operations in early April 2016 from its Nagoya/Chubu Centrair [NGO/RJGG] hub (AirAsia Japan selects Nagoya Chubu Centrair.) to Sapporo/New Chitose [CTS/RJCC], Sendai [SDJ/RJSS] (New AirAsia Japan mulls Nagoya – Sendai.), and Taipei/Taoyuan [TPE/RCTP] using an initial fleet of two 180-seat Airbus A320s. Its two-letter IATA code will be DJ.

The new AirAsia Japan's (Mk II) first aircraft Airbus A320-216(SL) JA01DJ/F-WWBV at Hamburg/Finkenwerder. It will be delivered shortly and is planned to arrive at Nagoya's Chubu Centrair on October 16th. (Photo: Tobias Gudat)

All three routes will start off with two daily round-trips, and details of their flight schedule will be released in late November, which will coincide with ticket sales start. The Japanese unit of Asia's largest LCC group aims to offer fares at approximately half or third of the price of full-service carriers such as All Nippon Airways [NH/ANA] and Japan Airlines [JL/JAL]. AirAsia Japan's (Mk II) initial expansion will focus on international destinations already served by an AirAsia Group carrier and within a four-hour radius from Chubu Centrair, with domestic routes following afterwards. It sees itself eventually flying 55% international and 45% domestic.

"We're targeting both inbound and domestic visitors. The Chubu (Greater Nagoya) region also has a population of 15 million, so there should be much more demand," said Yoshinori Odagiri, CEO of AirAsia Japan (Mk II), adding "For Sendai, those from abroad want to see Sakura in the spring and snow in the winter, and it's becoming popular among the Japanese too. If we can create demand and increase to four or five flights a day, it may become more appealing to business travelers as well." Sendai will be an all-new city on AirAsia Group's network; New Chitose is served by AirAsia X [D7/XAX] and Taipei/Taoyuan by both AirAsia [AK/AXM] and the AirAsia X.

AirAsia Japan (Mk II) has built Red Base, its headquarters and the base for other AirAsia Group activities in Japan, on the grounds of Nagoya Chubu Centrair. A 180-room low-cost hotel is also being erected at the airport by affiliate Red Planet Japan on behalf of Tune Hotels. (Photo: Aviation Wire)

"We are very excited to be back in Japan. We have fantastic partners here and we are united in the vision to change the way people travel in Japan," commented AirAsia Group CEO Tan Sri Tony Fernandes, going on to say "Centrair is a fantastic base and with our new routes, we look forward not only to enable the Japanese to enjoy our direct destinations but to connect them to the rest of Asia and beyond on our extensive network." The group's Malaysian long-haul arm is looking at resuming service to Chubu Centrair, along with Thai AirAsia X [XJ/TAX] as well, when ICAO's red flag on Thailand is lifted, to feed the Japanese unit's network.

Its first aircraft, A320-216(SL) JA01DJ, will arrive at Chubu Centrair on October 16th, having completed its first flight on July 7th and currently awaiting delivery at Toulouse/Blagnac [TLS/LFBO]. AirAsia Japan's (Mk II) A320s will be supplied from the huge AirAsia Group order pool, and they plan on building its fleet to six by the end of 2016. Five aircraft will be added each year onwards; 11 aircraft by the end of 2017 and 16 by the end of 2018. If demand warrants, they have the option to add two additional A320s by the end of 2018. Its headquarters were officially moved to its brand-new Red Base at Chubu Centrair effective September 29th, and the first batch of crews have already started training in Malaysia. The current workforce of 100 will be increased to around 250 by April 2016.

AirAsia Japan (Mk II) (AirAsia Japan is officially reborn; first flight June 2015.) also completed a shareholding structure reorganization on September 25th. Voting-rights-wise, AirAsia Investment's 33% and Rakuten's 18% ownership haven't changed, while Noevir Holdings' shareholding has been increased from 13.4% to 18% and Alpen from 7.4% to 18%, with FinTech Global Trading, a new investor, now holding 13%. Meanwhile, Octave Japan Infrastructure Fund no longer holds any voting stocks, though it will retain non-voting shares. This is AirAsia Group's second crack into the Japanese market; the original AirAsia Japan (Mk I) [JW/WAJ] (CoachFlyer JW8541: NRT - FUK on AirAsia Japan's Airbus A320.) ended in a divorce with joint-venture (JV) partner ANA Holdings due to managerial differences only 10 months after launching operations. That company now operates as Vanilla Air [JW/VNL] (Vanilla Air launches operations.) under 100% ANA control.

Source: The Star (Malaysia), 2015 October 6th. (in Japanese)
Source: Aviation Wire, 2015 October 6th. (in Japanese)

AirAsia Japan confirms Spring 2016 launch from Nagoya.

On July 21st, AirAsia Japan (Mk II) officially applied for an Air Operator's Certificate (AOC) with the Japan Civil Aviation Bureau (JCAB). Although a change in business strategy along with rigorous document preparations have resulted in an eight-month delay (AirAsia admits Skymark bid defeat, Japan unit delay to 2016.), the regulator is expected to grant permission as early as October. The reincarnation of AirAsia's Japanese unit will launch operations in March or April 2016 with both domestic and international routes from Nagoya/Chubu Centrair [NGO/RJGG] using 180-seat Airbus A320s (AirAsia Japan selects Nagoya Chubu Centrair.).

Seen departing Fukuoka in October 2013, AirAsia Japan's (Mk I) Airbus A320-214 JA02AJ has since been transferred to Indonesia AirAsia as PK-AZI. The first aircraft for AirAsia Japan (Mk II), A320-216(SL) JA01DJ (MSN 6702), has already completed its maiden flight from Toulouse. (Photo: Ryosuke Yano)

Its initial routes are expected to be Fukuoka [FUK/RJFF], Sapporo/New Chitose [CTS/RJCC], and Seoul/Incheon [ICN/RKSI], all former routes of the defunct first AirAsia Japan (Mk I) [JW/WAJ] (CoachFlyer JW8541: NRT - FUK on AirAsia Japan's Airbus A320.). Sendai [SDJ/RJSS] (New AirAsia Japan mulls Nagoya – Sendai.) and Taipei/Taoyuan [TPE/RCTP] will be added shortly after. Japan's latest LCC will establish regional international routes before adding more domestic destinations. Routes will officially be revealed in November, followed shortly by ticket sales start. Sister AirAsia X [D7/XAX], which suspended Kuala Lumpur/Sepang [KUL/WMKK] – Chubu Centrair in February, will also reinstate the link and help feed the Japanese unit.

AirAsia Japan (Mk II) will start with a pair of A320s supplied from the huge AirAsia Group order pool, and plans to build its fleet to six by the end of 2016. Five aircraft will be added each year onwards; 11 aircraft by the end of 2017 and 16 by the end of 2018. If demand warrants, they have the option to add two additional A320s by the end of 2018. All of the planned machines are too much for just the Nagoya market, and AirAsia Japan (Mk II) will continue to push for daytime slots at heavily-regulated Tokyo/Haneda [HND/RJTT]. Their first attempt failed when AirAsia's [AK/AXM] bid for bankrupt Skymark Airlines [BC/SKY] was rejected (ANA and AirAsia bid to save Skymark.). The government is willing to expand Haneda's slots as soon as it reaches accords with business districts and densely-populated areas where aircraft will overfly, hopefully in time for the 2020 Tokyo Olympics/Paralympics.

Nagoya is the third largest metropolitan area in Japan, however, its proximity to the Kansai (Greater Osaka) region and Osaka/Kansai [KIX/RJBB] has left Chubu Centrair underutilized. Along with Kansai, Chubu Centrair is also a 24-hour airport but with ample slots available, and AirAsia Japan (Mk II) is initially staying away from hotly-contested Kansai, which sees Peach Aviation [MM/APJ] and Jetstar Japan [GK/JJP] (Jetstar Japan launches Kansai hub.) established along with a plethora of foreign LCCs competing. However, overlaps will come in due course as all LCCs continue to expand, and some rivalry is inevitable as Jetstar Japan already operates from Chubu Centrair to Fukuoka, Kagoshima [KOJ/RJFK], Kumamoto [KMJ/RJFT], Okinawa/Naha [OKA/ROAH], and New Chitose (Jetstar Japan commences Nagoya – Okinawa.).

Leading AirAsia Japan (Mk II) is CEO Yoshinori Odagiri, who also headed the first version of the Japanese unit. Although originally an ANA veteran, he has since departed Japan's largest carrier to pursue "unfinished business" under the AirAsia brand. (Photo: Aviation Wire)

AirAsia Group CEO Tan Sri Tony Fernandes had said that AirAsia Japan (Mk II) would likely become the biggest contributor to the budget airline group within the next few years as it formed a cornerstone for the network's global aspirations. "With Japan, we don't only need to limit ourselves to Asia. Flights to Vancouver in Canada and Hawaii and the U.S. west coast are now possible. This means we're well on our way towards becoming a global airline," adding "Japan and India are key for us as they can be launching pads for expansion beyond Asia." Keeping up to Mr. Fernandes' ambitions, AirAsia X [D7/XAX] has applied to extend its Kuala Lumpur – Kansai link to Honolulu [HNL/PHNL] for launch as early as November. It would be a litmus test before launching direct flights to the U.S. west coast.

AirAsia Japan (Mk I) was a joint-venture with All Nippon Airways' [NH/ANA] parent ANA Holdings, which was terminated in June 2013 over differences in decision-making. It was subsequently re-branded Vanilla Air [JW/VNL] under full ANA control (Vanilla Air launches operations.). AirAsia's Japanese unit was officially reborn last July under the leadership of CEO Yoshinori Odagiri, who also headed the first incarnation, and CFO Osamu Hata, who previously worked with Dell Japan (AirAsia Japan is officially reborn; first flight June 2015.). Shareholding-wise, Malaysia's AirAsia controls 49%, Octave Japan Infrastructure Fund 19%, Rakuten 18%, Noevir Holdings 9%, and Alpen 5%, though voting-rights-based, AirAsia will hold 33%, the maximum allowed under Japan's current foreign ownership laws, while Octave will have 28.2%, Rakuten 18%, Noevir 13.4%, and Alpen 7.4%.
 
Source: Rakyat Post, 2014 July 16th. (in English)
Source: Toyo Keizai, 2015 July 21st. (in Japanese)
Source: Aviation Wire, 2015 July 21st. (in Japanese) 
Source: Nikkei Shimbun, 2015 July 21st. (in Japanese)

New AirAsia Japan mulls Nagoya – Sendai.

AirAsia Japan (Mk II) is reportedly considering Nagoya/Chubu Centrair [NGO/RJGG] – Sendai [SDJ/RJSS] as one of their first routes. The reincarnation of the pan-Asian LCC group's Japanese unit is currently preparing to launch flights before the end of 2015 with a hub at Chubu Centrair, which serves the nation's third largest metropolitan area (New AirAsia Japan eyes launch by year-end 2015.). CEO Yoshinori Odagiri had previously hinted Fukuoka [FUK/RJFF] and Sapporo/New Chitose [CTS/RJCC] as their first domestic cities and Taipei/Taoyuan [TPE/RCTP] as its first international destination.

Arriving at Trang is Airbus A320-214 HS-ABY of Thai AirAsia, the group's short-haul affiliate in Thailand. AirAsia Japan (Mk II) is also part of a strategy to shift dependence from Southeast Asia, where competition is fiercer than ever, with most of its siblings posting losses for 2014. (Photo: Ryosuke Yano)

Japan's latest LCC is planning to take delivery of its first aircraft, Airbus A320-216(SL) JA01DJ, the narrow-body family's 6676th to roll out of the production line, in July, with the second to arrive in August as JA02DJ (New AirAsia Japan's first Airbus A320 due in July.). The deadline for application for hiring flight attendants was February 1st, and applicants were required to have at least one year of experience. A two-month training program at AirAsia's [AK/AXM] Malaysia headquarters would start as early as May. However, the airline has yet to officially apply for an air operator's certificate (AOC) with regulatory paperwork taking more time than expected.

Meanwhile, Hiroshi Takeshi, President of Central Japan International Airport, which operates Chubu Centrair, has said "We're ready to begin work on the LCC terminal as soon as AirAsia makes its formal decision." The airport was on track to build an LCC-dedicated terminal capable of processing 5 million annual domestic and international passengers until the original AirAsia Japan (Mk I) [JW/WAJ] withdrew at the end of August 2013, after the first joint-venture (JV) with ANA Holdings failed. Chubu Centrair has set a target for 15 million passengers by 2020, which is double the current figures, but Mr. Kawakami believes "It's not impossible if we could attract more LCCs."

Also, AirAsia is currently bidding to sponsor Skymark Airlines [BC/SKY] out of bankruptcy, competing with former JV partner ANA (ANA and AirAsia bid to save Skymark.). Proposals from neither parties have been disclosed, however, the Malaysia-based LCC is reportedly calling for a re-branding of Skymark under AirAsia, launching a new JV long-haul subsidiary (a hint at AirAsia X Japan?), and a potential future merger with AirAsia Japan (Mk II), in exchange for initially investing up to 20% in Skymark and mediating discussions with Airbus and aircraft lessors to reduce the cash-strapped carrier's debts (Skymark's total debts skyrocket to 300 billion JPY.). AirAsia Japan's (Mk II) plans may change depending on the outcome of the Skymark proposal.

Source: Aviation Wire, April 1st 2013. 
Source: Aviation Wire, October 4th 2013.
Source: Nikkan Kogyo Shimbun, February 11th 2015.
Source: Nikkan Kogyo Shimbun, April 1st 2015. 
Source: Traicy, April 1st 2015.

Is the new AirAsia Japan delaying launch?

It was July 1st when the reincarnation of AirAsia Japan (Mk II) was boldly announced (AirAsia Japan is officially reborn; first flight June 2015.) with non-airline partners Octave Japan Infrastructure Fund owning 19%, Rakuten 18%, Noevir Holdings 9%, and Alpen 5% with an initial capital totaling 7 billion JPY, together with AirAsia's [AK/AXM] 49%. First flight was told to take place as early as July 2015 from Nagoya/Chubu Centrair [NGO/RJGG] (AirAsia Japan selects Nagoya Chubu Centrair.) initially with domestic routes. But nothing has been heard from them since.

However, in their Third Quarter 2014 report, the AirAsia Group announced plans to take only five Airbus A320s in 2015, with four earmarked for Thai AirAsia [FD/AIQ] and a single aircraft for AirAsia (Malaysia). The southeast Asia market is now suffering from overcapacity and most of AirAsia Group's airlines are incurring losses or significantly reduced profits, though still performing better than most competitors. In the previous version of its 2015 fleet plan, which was released in August as Second Quarter 2014 earnings were reported, the LCC group had additionally earmarked three A320s each for AirAsia India [I5/IAD] and Japan. Does this  mean AirAsia Japan (Mk II) will not take delivery of any aircraft, and thus not launch operations next year? Or are some of the Malaysian unit's surplus A320s coming over?

Airbus A320-216 HS-ABO of Thai AirAsia taxies at Bangkok's Don Mueang. All of AirAsia's affiliates are incurring losses or significantly reduced profits. With aircraft for AirAsia Japan no longer in the orderbooks for 2015, has the launch been delayed? (Photo: Ryosuke Yano)

And on November 22nd, Skymark Airlines' [BC/SKY] President and CEO Shinichi Nishikubo disclosed that AirAsia Group was indeed one of a handful of carriers they were negotiating with for a partnership. Japan's third largest carrier looked for new tie-ups as their profitability rapidly deteriorated (Skymark posts 5.7 billion JPY loss for 1Q FY2014.) amid a depreciated JPY, heavy competition with LCCs as well as full-service carriers, and costs related to the introduction of the A330 (Skymark Airlines inaugurates Airbus A330 service.) and now-canceled A380 (Skymark's Airbus A380 order in jeopardy.). But Mr. Nishikubo has narrowed down its potential partner to Japan Airlines [JL/JAL] (Skymark in talks with JAL for broad tie-up.), and told that talks with AirAsia Group started in August and only ended earlier this month.

Actually, it is now known that Hiroshi Mikitani, President of AirAsia Japan's (Mk II) key partner Rakuten, was on the verge of acquiring a majority stake in Skymark earlier this spring. However, the deal fell through when Mr. Mikitani found out about Skymark's troubles regarding the A380 order, a few months before that news came to light. So, AirAsia Japan (Mk II) probably had some inside knowledge about Skymark's financial state and outlook. "We will start from a non-Tokyo city, but Tokyo is a very big market that cannot be omitted," told Yoshinori Odagiri, CEO of AirAsia Japan (Mk I & II), who has seemed confident in obtaining slots at heavily-regulated Tokyo/Haneda [HND/RJTT]. Or had they drawn a picture of taking over Skymark from the first place (Is AirAsia considering a Skymark takeover?)? 

With the government's target to bring 20 million visitors to Japan by 2020 when the Tokyo Olympics/Paralympics take place, opening up airspace over metropolitan Tokyo, which could potentially create 50 or so more slot-pairs at Haneda, is seriously being discussed. But the Japan Civil Aviation Bureau (JCAB) along with the government so far seem unwilling to distribute the slots to LCCs, calling it "prized properties that belong to the Japanese public." AirAsia is counting on Mr. Mikitani, who is a member of the government's Economic Revitalization Committee and has personal relationships with Prime Minister Shinzo Abe, to receive slots at the preferred Tokyo airport near downtown.

Nagoya is a huge metropolitan area that could potentially become a home for an LCC. However, the market is underdeveloped and with people too used to the super-efficient Shinkansen and hometown carrier All Nippon Airways [NH/ANA], it will take a few years for locals to accept AirAsia Japan (Mk II). Further, the battle has actually already begun, with Jetstar Japan [GK/JJP] having entered the market and expanding (Jetstar Japan starts three routes from Kumamoto.), and ANA retaliating by slashing fares to match them on competing routes. AirAsia Japan (Mk II) probably knows more than anyone else that domestic low-fare is difficult to make it work without a hub in Tokyo, so if prospects of getting Haneda slots diminish, there may not be an incentive to relaunch the Japanese unit after all. Let's wait and see...

Reference: Business Journal, September 10th. (in Japanese)
Reference: Sankei Shimbun, November 23rd. (in Japanese)
Reference: Centre for Aviation, November 24th. (in English)

Is AirAsia considering a Skymark takeover?

On August 19th, the Nikkei Shimbun reported that the AirAsia Group has started considering an investment in ailing Skymark Airlines (BC/SKY), including a possible takeover. It said that the Malaysian LCC, a very important customer for Airbus, is also talking with the European manufacturer to reduce the penalties they are seeking with Skymark for the canceled Airbus A380 order (Skymark's Airbus A380 order in jeopardy.), if AirAsia takes control of Japan's third largest carrier.

AirAsia's Airbus A320-214 9M-AHD taxies at Kuala Lumpur. (Photo: Ryosuke Yano)

Skymark holds 36 precious slot-pairs at preferred Tokyo/Haneda (HND/RJTT), something AirAsia is craving for. The report said that AirAsia has initiated discussions with several Japanese financial firms to make a bid for Skymark through AirAsia Japan (Mk II), which is expected to launch services from Nagoya/Chubu Centrair (NGO/RJGG) by July 2015 (AirAsia Japan selects Nagoya Chubu Centrair.). As far as voting-rights are concerned, foreign ownership of Japanese airlines is capped at 33%. Shares of Skymark rose almost 28% and closed at 230 JPY today. Major shareholders include Shinichi Nishikubo, its President and CEO, controlling 30.57%, travel agency H.I.S. with 7.72%, and Master Trust Bank of Japan owning 3.24%.

However, both airlines denied the report. "There is nothing the company is aware of and we have not been approached by AirAsia regarding any financial support," said a press release from Skymark, while AirAsia Group CEO Tony Fernandes said "Never seen such rubbish. AirAsia has no interest in Skymark in Japan. There have been no discussions with Skymark. We (are) focused on new airline," through Twitter. But then again, almost always there's no smoke without fire, and Nikkei is usually a reliable source. AirAsia Japan CEO Yoshinori Odagiri hasn't denied as well, saying "Nothing has materialized, but we keep all doors open." It may well be that AirAsia is only dismissing the reports to help lower Skymark's shares as much as possible.

Skymark's Boeing 737-86N JA737L taxies at Narita. The aircraft was returned to its lessor in April this year, and fitted with winglets it now serves with Jeju Air as HL8019. (Photo: Aviation Wire)

The first child of Japan's deregulation, Skymark is the only start-up that has so far succeeded in cracking the ANA/JAL duopoly, under the leadership of hands-on and charismatic Mr. Nishikubo. It is also what forced All Nippon Airways (NH/ANA) and Japan Airlines (JL/JAL) to launch subsidiary LCCs Peach Aviation (MM/APJ) and Jetstar Japan (GK/JJP), respectively. However, increased competition with LCCs as well as the legacies lowering prices, coupled with a depreciated JPY, high fuel bills, and costs regarding the introduction of the A330 (Skymark Airlines inaugurates Airbus A330 service.) and A380, it tumbled to a full-year loss for the first time in five years for FY2013, announcing a 1.8 billion JPY loss.

It was dealt a further blow when Airbus unilaterally terminated Skymark's A380 order, doubting the carrier's ability to pay. The European planemaker is said to be seeking 70 billion JPY in penalties, in addition to already-paid deposits amounting to 26.5 billion JPY, which is unlikely to be refunded. The figure is only expected to grow, as Rolls-Royce and interior makers also prepare to seek compensation from Skymark. As if that weren't enough, they posted a whopping 5.7 billion JPY loss only in the first quarter of FY2014 (Skymark posts 5.7 billion JPY loss for 1Q FY2014.), prompting accountants to report "doubts about its ability to continue as a going concern." As of June, Skymark's cash and near-term assets stood at 7.2 billion JPY.

Skymark is realigning their business by cutting unprofitable routes and concentrating on their core markets (Skymark announces Narita closure and Yonago cuts.), while also raising fares and introducing a revamped fare system from October where the price will vary depending on availability. Financial support, something they have never asked for in their history, is desperately being sought for. However, with Mr. Nishikubo continuing to emphasize "We'll try to survive on our own," and ANA and JAL obviously not wanting an AirAsia brand in their by far most profitable (and protected) market, backroom political lobbying has probably already begun and it will not be easy for AirAsia.

I certainly hope Skymark can make it on their own. It would be too bittersweet (and to Mr. Nishikubo the most) for an icon that virtually revolutionized Japan's air industry to be swallowed up, even if that is by another respected carrier that transformed the market in Southeast Asia.

Reference: Nikkei Shimbun, August 19th. (in Japanese)
Reference: Bloomberg Japan, August 19th. (in Japanese)
Reference: Skymark Airlines, August 19th. (in Japanese)
Reference: Tony Fernandes @ Twitter (in English)

AirAsia Japan selects Nagoya Chubu Centrair.

AirAsia Japan (Mk II) has reportedly made its final decision to make Nagoya/Chubu Centrair (NGO/RJGG) its hub (New AirAsia Japan to be based at Nagoya Chubu Centrair.). On August 15th, CEO Yoshinori Odagiri revealed in an interview that they will set up a maintenance base at the airport serving Japan's third largest metropolitan area. "While there are no vacancies at Haneda and Narita not open 24 hours a day, Centrair is open around the clock," said Mr. Odagiri, adding "Kansai is attractive, but the situation is tough for a latecomer." Initial routes being considered are to Fukuoka (FUK/RJFF) and Sapporo/New Chitose (CTS/RJCC), with Taipei/Taoyuan (TPE/RCTP) expected to be their first international destination. 

On July 1st, AirAsia announced the reincarnation of their Japanese unit (AirAsia Japan is officially reborn; first flight June 2015.), this time with non-airline partners which includes Octave Japan Infrastructure Fund (19%), Rakuten (18%), Noevir Holdings (9%), and Alpen (5%) with an initial capital totaling 7 billion JPY together with AirAsia (49%). Voting-rights-based, AirAsia will control 33%, the maximum possible figure allowed under Japan's current airline foreign ownership laws, while Octave will have 28.2%, Rakuten 18%, Noevir 13.4%, and Alpen 7.4%.

Airbus A320-214 JA01AJ of AirAsia Japan (Mk I) sits at Narita in its final days in Japan. The aircraft is now with the group's Indonesian unit as PK-AZJ. (Photo: Ryosuke Yano)

Work is underway for a June 2015 launch, or "July 20th (2015) at latest," according to Mr. Odagiri, with a fleet of two 180-seat Airbus A320s supplied from AirAsia Group's huge order pool. It will likely start off with two routes from Chubu Centrair, most likely Fukuoka and New Chitose with three round-trips each, later expanding to other domestic and regional international destinations, with Taiwan expected to be the first of the latter. A 'Fly-Thru' product will also be offered including on AirAsia X (D7/XAX), which already serves Chubu Centrair four times weekly from Kuala Lumpur (KUL/WMKK). Two more A320s will be added before the end of 2015, with five to be added each year from 2016 onwards. A320neo aircraft will be added from 2016, putting Vietnam within range. Its first full-year profit is targeted by FY2017, its third year of operations.

The Chubu Centrair – New Chitose route is currently served by All Nippon Airways' (NH/ANA) Group seven times daily using Boeing 767s and 737s, Japan Airlines (JL/JAL) five times daily with 737s, Skymark Airlines (BC/SKY) twice daily with 737s, and Jetstar Japan (GK/JJP) once daily with A320s. The Fukuoka route is served by ANA six times daily with A320s, 737s, and Bombardier CRJs, Star Flyer (7G/SFJ) four times daily with A320s, de facto operating for ANA (Star Flyer to add ANA's code on all flights.), and Jetstar Japan once daily with A320s. Fuji Dream Airlines (JH/FDA) flies five round-trips connecting Nagoya/Komaki (NKM/RJNA) and Fukuoka, with JAL code-sharing on all flights.

However, Mr. Odagiri is bullish about getting slots at Tokyo/Haneda (HND/RJTT), saying Tokyo/Narita (NRT/RJAA) is too far and curfew-plagued, while Ibaraki (IBR/RJAH) is cost effective but again too far and also too small for a hub. "For 2020 (Tokyo Olympics/Paralympics), the MLIT (Japan Ministry of Land, Infrastructure, Transport, and Tourism) is considering all options, and we would like to make the necessary preparations," citing the government seriously talking about opening up airspace over metropolitan Tokyo, which could potentially create 50 or so more slot-pairs. Haneda operates four runways that are fully utilized, however, current airspace restrictions force all aircraft to arrive from and depart towards Tokyo Bay, meaning the number of movements per runway is kept low. A new runway would not make it before 2020.

AirAsia Japan (Mk I) and (Mk II) CEO Yoshinori Odagiri. (Photo: Aviation Wire)

If they fail to get slots at Haneda, Mr. Odagiri says they would have to consider Narita and Ibaraki, but at the same time ask to open up military airports in the Kanto (Greater Tokyo) region such as Japan Self Defense Force (JSDF)-controlled Atsugi (NTA/RJTA) and U.S. Air Force (USAF)-controlled Yokota (OKO/RJTY). Asked if AirAsia Japan (Mk II) is interested in partnering with troubled Skymark (Skymark posts 5.7 billion JPY loss for 1Q FY2014.), which currently holds 36 prized slot-pairs at Haneda, "Nothing has materialized, but we keep all doors open," he answered.

The Malaysia-based LCC group's first crack at the Japanese market with AirAsia Japan (JW/WAJ) (Mk I) (CoachFlyer JW8541: NRT - FUK on AirAsia Japan's Airbus A320.) ended in a divorce with joint-venture (JV) partner ANA, only 10 months after launching operations in August 2012, due to disagreements over how the airline would be run. "We would first listen to Tony (Fernandes), then bring it to ANA. But couldn't get expected responses in expected time frames," says Mr. Odagiri, who also headed the first incarnation. It ceased operations on October 26th, 2013, and relaunched as Vanilla Air (JW/VNL) under 100% ANA ownership on December 20th (Vanilla Air launches operations.). 

Another factor behind the failure was AirAsia's website being deemed difficult to use by the Japanese public; it asked to fill out passport information even on domestic flights, required to fill out the 'Issuing Bank' of a credit card which is not the norm in Japan, and simply took too much time. "What the Japanese feel as easy-to-use is something like Amazon.com," Mr. Odagiri said, adding "A Japanese manager has been assigned to take over AirAsia's website development. A revamped easy-to-use website for the entire group should be up by Spring 2015, and small bugs should be fixed by the time we start ops."

AirAsia Japan (Mk II) has already started crew recruiting. "Some employees remained with Vanilla Air for the sake of jobs, but they didn't enter the airline just to work for a company that would change its brand in just 10 months," said Mr. Odagiri, implying some if not many of the current employees at Vanilla could move to the red brand. It is rumored that AirAsia is offering crew salaries similar to ANA's figures, which could lure JAL crews, whose salaries were drastically cut during that group's restructuring. Pilot shortages have plagued LCCs Peach Aviation (MM/APJ) (Peach outlines Summer 2014 mass cancellations.) and Vanilla (Vanilla Air cancels 154 flights in June due to pilot shortage.) with mass cancellations.

Together with their recently-launched India unit, AirAsia Group's second attempt at the Japanese market is also part of their strategy to shift dependence from Southeast Asia, a still-growing but becoming an over-crowded market, to other parts of Asia and beyond, and to become a global brand. Although nothing has been decided yet, AirAsia is considering an affiliate in eastern Europe, as well as an AirAsia X India that would put Africa and Europe within range, and an AirAsia X Japan that would enable them to reach Canada, Hawaii, and west coast U.S.A. The group's recent order for 50 A330-900neo aircraft would obviously be too much for just the current AirAsia X brands in Indonesia, Malaysia, and Thailand to absorb.

Reference: Traicy, July 29th. (in Japanese)
Reference: Jiji Press, August 15th. (in Japanese)
Reference: Japan Times, August 16th. (in English)

AirAsia Japan is officially reborn; first flight June 2015.

On July 1st, AirAsia Group CEO Tony Fernandes formally announced the launch of AirAsia Japan (Mk II) at a press conference in Tokyo. The newest unit of the Malaysia-based pan-Asian LCC group was officially formed on this day, with Mr. Fernandes saying "This is Part 2 of AirAsia Japan's performance, and it will be the last. We will bring Japan and the rest of Asia closer by offering affordable fares." First revenue flight is to take place in summer 2015.

Yoshinori Odagiri, AirAsia Japan (Mk II) CEO; Tony Fernandes, AirAsia Group CEO; and Hiroshi Mikitani, President of Rakuten (black shirt). (Photo: Aviation Wire)

An initial capital of 7 billion JPY has been raised from five investors; Malaysia's AirAsia (AK/AXM) accounts for 49%, Octave Japan Infrastructure Fund 19%, Rakuten 18%, Noevir Holdings 9%, and Alpen 5%. According to voting-rights, AirAsia will control 33%, the maximum possible figure allowed under Japan's current airline foreign ownership laws, while Octave will have 28.2%, Rakuten 18%, Noevir 13.4%, and Alpen 7.4%. "We are very excited to return to Japan's skies together with Octave, Rakuten, Noevir and Alpen this time round. I am more confident than ever that AirAsia Japan, led by Odi (Odagiri Yoshinori) with the strong partnership we have with our new investors, will continue to realize our vision to revolutionize the low-cost carrier segment of Japan," Mr. Fernandes said.

Octave was incorporated in Japan in May 2014 and its major business is to manage the shares of AirAsia Japan. Rakuten (AirAsia and Rakuten to announce AirAsia Japan on July 1st.) was an IT venture originally founded in February 1997 but now Japan's largest e-commerce firm, with other major businesses including financial services, telecommunications, and professional sports, owning the Tohoku Rakuten Golden Eagles baseball team. Noevir is involved in the cosmetics, pharmaceuticals, and health food and apparel industry. Alpen has been producing a wide range of sports equipment from ski, golf, tennis, marine sports, and baseball since 1972, and it also manages ski resorts, golf courses, and fitness clubs.

From top-left to right: Taizo Mizuno (President of Alpen), Hiroshi Mikitani (President of Rakuten), Yoshinori Odagiri (CEO of AirAsia Japan), Tony Fernandes (CEO of AirAsia Group), and Takashi Okura (President of Noevir Holdings). (Photo: Mynavi)

"If you look around the world, LCCs are stimulating air travel. Their share has grown to around 50% in Southeast Asia, but still only accounts for 3% in Japan. The country is now moving to increase foreign visitors to 20 million by 2020 (when the Tokyo Olympics/Paralympics take place). LCCs will play a pivotal role in surpassing that milestone and will also contribute to the country's economy," Mr. Mikitani said, adding "We are simply a shareholder supporting AirAsia's growth in Asia." Being a personal friend of Mr. Fernandes as well, he also said, "From in-flight entertainment to shopping and payments, the airline market has lots of possible synergies with IT. E-commerce partnerships are possible in the long-term."
 
CEO of AirAsia Japan (Mk II) is Yoshinori Odagiri (New AirAsia Japan names CEO; official launch in April.), who also headed the first incarnation. The failed 10-month joint-venture (JV) between AirAsia and All Nippon Airways (NH/ANA) has since relaunched as Vanilla Air (JW/VNL) (Vanilla Air launches operations.) under full ANA control. Starting out his aviation career with ANA back in 1987, Mr. Odagiri quit ANA and AirAsia Japan (Mk I) in August 2013, two months after the JV was dissolved (operations under the AirAsia brand continued through October 26th), and joined AirAsia the following month to help re-launch the red brand in the country of the rising sun. 

"AirAsia Japan has returned," Mr. Odagiri enthused, telling that operations will start as early as June 2015 on domestic routes, followed by regional international flights. An initial fleet of two 180-seat Airbus A320s will be sourced from AirAsia Group's huge order pool, with four planned by the end of 2015. Five will be added each year after that.

Some of AirAsia Japan's aircraft will feature special liveries designed by photographer and film director Mika Ninagawa. (Image: Mika Ninagawa)

Asked about their hub, Mr. Odagiri answered "Nagoya was chosen (New AirAsia Japan to be based at Nagoya Chubu Centrair.) for initial registration purposes. We will formally announce a hub in due course," adding "We will start from a non-Tokyo city, but Tokyo is a very big market that cannot be omitted. The (Japanese) government is considering increasing slots at Haneda, and we certainly would like to receive some." He went on to say "We first need to stabilize our business by producing profits on trunk (domestic) routes, and after that, we hope to enter the under-served rural (domestic) markets."

Regarding pilot shortages which have plagued LCCs Peach Aviation (MM/APJ) (Peach outlines Summer 2014 mass cancellations.) and Vanilla Air (Vanilla Air cancels 154 flights in June due to pilot shortage.) with mass cancellations, Mr. Odagiri said "We want to plan well, including crew sourcing from the group's other airlines."

Speaking about the Tokyo/Narita (NRT/RJAA)-based LCCs struggling to turn profits, Mr. Fernandes commented "Because they're based at high-cost Narita. And Haneda is not far away. If we take a different approach, we believe we can produce a profit in five or six years." He also said "What we learned the first time is that we should work with like-minded people. We make decisions very quickly. We'll do better than partnering with huge established corporations." For the failed first attempt, AirAsia erred in giving majority control to ANA, which made the move mostly to prevent AirAsia from partnering with other companies. As Mr. Mikitani's statement implies, AirAsia is at the controls this time, and the other investors are only supporters.

AirAsia's distinctive red flight attendants. Noevir will reportedly supply their cosmetics. (Photo: Mynavi)

"We are ready to take on this challenge and with great teamwork, we hope to bring AirAsia's successful low-cost business model once again to Japan. Our counterparts in Malaysia, Thailand, Indonesia, the Philippines, and India have seen great and encouraging responses in their markets, and we will work towards the same for Japan. We would like to thank the investors for their belief in us and we look forward to working closely with them moving forward," said Mr. Odagiri.

Now AirAsia Japan (Mk II) would be the fifth LCC in an already increasingly crowded market. Is market consolidation (any eliminations?) coming up in the not-too-distant future? Vanilla Air, though wholly-owned by ANA, seems to be the weakest. Further, just of note, Vanilla Air has dozens of staff who were inspired by AirAsia and Mr. Fernandes and said they "would like to work with a future AirAsia," when the first JV was dissolved. Now that their former direct boss (Mr. Odagiri) has moved to restart the red brand, will a brain-drain happen at Vanilla Air?

Reference: Traicy, July 1st. (in Japanese)
Reference: Reuters Japan, July 1st. (in Japanese)
Reference: MyNavi, July 1st. (in Japanese)
Reference: Aviation Wire, July 1st. (in Japanese)