Sunday, July 20, 2014

Peach launches Naha hub; but Naha – Ishigaki axed.

On July 19th, Peach Aviation (MM/APJ) officially launched their second hub at Okinawa/Naha (OKA/ROAH), commencing a daily round-trip connecting Naha and Fukuoka (FUK/RJFF) (Peach announces Naha – Fukuoka.) with 180-seat Airbus A320s. One aircraft will be based at Naha.
Departing for MM288's inaugural flight, Airbus A320-214 JA806P is seen off by employees of Peach and officials of Okinawa. (Photo: Peach)

The inaugural flight MM288 from Naha to Fukuoka departed at 1639 JST with 174 passengers, and arrived at the Kyushu airport at 1823. Return leg MM289 departed Fukuoka at 1906 with an identical number of passengers at 174, and arrived back at Naha at 2041. One-way fares range from 4,290 to 21,990 JPY. Naha will now offer three destinations, including Osaka/Kansai (KIX/RJBB) and Taipei/Taoyuan (TPE/RCTP). The Ishigaki (ISG/ROIG) link was suspended on the previous day on July 18th.

Flight Schedule (July 19th - September 20th):
Naha – Fukuoka NEW 1 daily with A320-200.
MM288 OKA 1635 – 1815 FUK 320 Daily
MM289 FUK 1845 – 2025 OKA 320 Daily

Flight Schedule (September 21st - October 25th):
Naha – Fukuoka 1 daily with A320-200.
MM288 OKA 1820 – 2000 FUK 320 Daily
MM289 FUK 2030 – 2210 OKA 320 Daily 

In April, the Kansai-based LCC announced major flight disruptions due to the lack of pilots (Peach outlines Summer 2014 mass cancellations.), resulting in 2,080 cancellations, a whopping 16.1% of its total 12,886 flights planned between May 1st and October 25th. Naha – Ishigaki was initially reported to be a temporary casualty, however, it was recently revealed that it would be suspended from July 19th, and will be terminated on August 31st, axing the route indefinitely. Peach will continue to maintain a once-daily Kansai – Ishigaki link.

CEO Shinichi Inoue said "Load factors weren't bad," adding "There are many carriers here, and we decided it would be wiser to use the aircraft somewhere else," citing heavy competition. ANA Group offers nine daily round-trips, JAL Group flies seven, while Skymark Airlines (BC/SKY) operates four round-trips, and Peach had one. After Skymark and Peach entered the market with fares as low as 4,200 JPY and 3,290 JPY, respectively, ANA (parent ANA Holdings minority-owns Peach) and JAL slashed their fares from around 20,000 JPY to 5,000 JPY, sparking a fare war. Naha – Ishigaki thus became Peach's first route to be terminated.

Peach becomes the second Japanese LCC to launch a second hub, after Tokyo/Narita (NRT/RJAA)-based Jetstar Japan (GK/JJP) launched their Kansai hub (Jetstar Japan launches Kansai hub.) on June 12th. Strategically located, Peach intends to use Naha as a scissors hub to funnel passengers between the main islands of Japan and Southeast Asia. "Our A320s cannot reach Southeast Asia from Kansai, but the Naha hub would enable us to meet the growing demand to and from that region," Mr. Inoue says. He added that Thailand and Vietnam are at the top of the list of destinations he would like to start flying to.

The Kansai-based LCC currently operates 10 A320 flying six international and 10 domestic routes. Peach is owned 38.67% by ANA Holdings, 33.33% by Hong Kong-based First Eastern Investment Group, and 28.0% by Innovation Network Corporation of Japan.

Reference: Nikkei Shimbun, July 18th. (in Japanese)
Reference: Peach Aviation @ Facebook. (in Japanese)
Reference: Aviation Wire, July 20th. (in Japanese)

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