China Airlines Ltd (CAL, 中華航空) yesterday announced it is to set up a low-cost carrier venture with Tiger Airways Pte of Singapore and plans to launch operations in the fourth quarter next year.
The joint venture, which has a paid-up capital of NT$2 billion (US$67.33 million), is to run a budget airline under the brand Tigerair Taiwan, which is licensed by Tiger Airways and based at the Taiwan Taoyuan International Airport.
NORTHEAST ASIA
Photo: Yao Chieh-hsiu, Taipei Times
Tigerair Taiwan aims to be a no-frills carrier providing international air travel services across Northeast Asia, including Japan, South Korea and the second-tier and third-tier cities of China.
“China Airlines’ knowledge of the Taiwan market, coupled with Tiger Airways’ expertise in the no-frills sector, should stimulate demand in the civil aviation market here,” CAL chairman Sun Hung-hsiang (孫洪祥) told a press conference.
CAL is not the only airline in Taiwan planning to enter in the low-cost carrier market.
Last month, TransAsia Airways Corp (TNA, 復興航空), which mainly serves passengers on regional and cross-strait routes, said it would establish a budget airline subsidiary within one year to meet rising demand.
The company, which mainly serves passengers on regional and cross-strait routes, said it planned to invest between NT$2 billion and NT$3 billion to operate the subsidiary.
Sun said CAL and Tiger Airways are submitting an application for regulatory approvals from the Ministry of Economic affairs and the Civil Aeronautics Administration (CAA), aiming to operate as quickly as possible.
In addition, the launch of Tigerair Taiwan will help increase CAL’s sales performance and profitability, Sun said, as CAL holds a 90 percent share in the new carrier, with its Singapore partner taking the other 10 percent.
Sun expressed optimism that Tigerair Taiwan will “absolutely” turn profit after three years of operation, with the company aiming to break even in its first year of operation.
INITIAL THREE PLANES
Tigerair Taiwan plans to buy three Airbus SAS’ 320 series aircraft, with the fleet expected to total 12 planes in 2016 or 2017.
The new joint venture is to allow Tiger Airways to extend its presence into new untapped markets in Northeast Asia, chief executive officer Koay Peng-yen (郭炳炎) said.
Tiger Airways Holding Ltd currently operates a fleet of 50 aircraft to over 50 destinations, from its bases in Singapore, Indonesia, the Philippines and Australia, while CAL operates a fleet of 75 aircraft to 109 domestic and international destinations in its network.
HANDOVER POLICY: Approving the probe means that the new US administration of Donald Trump is likely to have the option to impose trade restrictions on China US President Joe Biden’s administration is set to initiate a trade investigation into Chinese semiconductors in the coming days as part of a push to reduce reliance on a technology that US officials believe poses national security risks. The probe could result in tariffs or other measures to restrict imports on older-model semiconductors and the products containing them, including medical devices, vehicles, smartphones and weaponry, people familiar with the matter said. The investigation examining so-called foundational chips could take months to conclude, meaning that any reaction to the findings would be left to the discretion of US president-elect Donald Trump’s incoming team. Biden
INVESTMENT: Jun Seki, chief strategy officer for Hon Hai’s EV arm, and his team are currently in talks in France with Renault, Nissan’s 36 percent shareholder Hon Hai Precision Industry Co (鴻海精密), the iPhone maker known as Foxconn Technology Group (富士康科技集團) internationally, is in talks with Nissan Motor Co’s biggest shareholder Renault SA about its willingness to sell its shares in the Japanese automaker, the Central News Agency (CNA) said, citing people it did not identify. Nissan and fellow Japanese automaker, Honda Motor Co, are exploring a merger that would create a rival to Toyota Motor Corp in Japan and better position the combined company to face competitive challenges around the world, people familiar with the matter said on Wednesday. However, one potential spanner in the works is
HON HAI LURKS: The ‘Nikkei’ reported that Foxconn’s interest in Nissan accelerated the Honda-merger effort out of fears it might be taken over by the Taiwanese firm Nissan Motor Co has become the latest buyout target in Japan as it explores a merger with Honda Motor Co and faces an overture from Hon Hai Precision Industry Co (鴻海精密), known as Foxconn Technology Group (富士康科技集團) internationally. Shares in Nissan yesterday jumped 24 percent, the most on record, to hit the daily limit, after the two Japanese automakers acknowledged that talks are ongoing to better position themselves for competitive challenges during a time of upheaval in the global auto industry. Foxconn — a Taipei-based manufacturer of iPhones, which has been investing heavily in factories to build electric vehicles — has also
CHIP SUBSIDY: The US funding would help alleviate the financial pressure from building two fabs in the US and should lift gross margins in 2026, the company said GlobalWafers Co (環球晶圓), the world’s third-largest silicon wafer supplier, yesterday said it is to receive US$406 million in subsidies from the US Department of Commerce for two new US fabs under the CHIPS and Science Act, with the first batch of the funds likely coming next year. The grant represents 10 percent of the planned investments of US$4 billion in advanced semiconductor wafer manufacturing facilities in Texas and Missouri, GlobalWafers said. The commerce department is to disburse the funds based on the completion of project milestones over a multiyear timeframe, the company said. Along with the tax credit, which is equal to
RSS