Monday, April 27, 2015

Skymark to pull out of Sendai in October.

On April 24th, Skymark Airlines [BC/SKY] submitted plans to Japan's Ministry of Land, Infrastructure, Transport, and Tourism (MLIT) to suspend its twice-daily Sendai [SDJ/RJSS] – Kobe [UKB/RJBE] service from the Winter 2015/2016 timetable, effective October 25th. The embattled airline would thus be dropping the city entirely, as it is the last remaining route from the former focus city (Skymark announces Yonago and Sendai expansion.).
Boeing 737-86N(WL) JA73NX taxies at Narita. Skymark axed Narita in October last year (Skymark announces Narita closure and Yonago cuts.), Ishigaki and Miyako in March, and will drop Yonago in August (Skymark decides to close Yonago, keep Ibaraki.), and now Sendai in October. (Photo: Ryosuke Yano)

Sendai used to see Skymark flights to Fukuoka [FUK/RJFF] and Sapporo/New Chitose [CTS/RJCC], but these were quickly axed (Skymark to cut 15% of flights, ground all Airbus A330s.) after they filed for bankruptcy protection (Skymark to file for bankruptcy.). Kobe, another focus city, was the last remaining route, but it was seen as a matter of time as load factors hovered around an embarrassing 20-40%. March 2015 was a better month at 43.7%. 177-seat Boeing 737-800s operate the route.

Japan's third largest airline entered Sendai, Tohoku (Northeastern Japan) region's biggest metropolitan area, on April 20th, 2013 with flights to Fukuoka and New Chitose, only eight days after LCC Peach Aviation [MM/APJ] launched flights from Osaka/Kansai [KIX/RJBB] on April 12th. Ironically, the latter has since increased to three-times daily and announced intentions to make Sendai a hub (Peach plans Sendai hub by Summer 2017.), while Skymark has decided to pull out completely. It is lower cost, but not as low as the LCCs to stimulate demand.

On April 22nd, Skymark signed a Memorandum of Understanding (MoU) with equity firm Integral and ANA Holdings, parent of All Nippon Airways [NH/ANA], to sponsor the cash-strapped airline out of bankruptcy (Skymark gives in to ANA; Japan reverts to duopoly.). Details of the corporation rehabilitation plan, which needs to be submitted to the Tokyo District Court by May 29th, have yet to be disclosed, however, it will likely include code-sharing, joint fuel purchasing, and joint crew training with ANA. A re-branding is also being considered, with SKY bee a reported contender (Skymark hints at new brand: SKY bee?).

Source: Kobe Shimbun, April 24th. (in Japanese) 
Source: Nikkei Shimbun, April 24th. (in Japanese)

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