V Air (威航), a budget airline fully owned by TransAsia Airways Corp (復興航空), yesterday announced plans to bow out of the local market to curb losses due to sharpening competition.
The carrier is to stop operations in October, allowing TransAsia Airways to better consolidate its resources and stem mounting losses.
The announcement came after TransAsia’s board of directors approved the decision.
“The move is part of the company’s long-term transformation plans to optimize resource utilization and lower operating costs,” TransAsia chairman Vincent Lin (林明昇) said in a statement following a board meeting.
Lin also pledged to prioritize improving flight safety standards and to look after the interests of affected employees.
The company’s business has taken a hit after two fatal accidents involving TransAsia aircraft in July 2014 and February last year.
After absorbing its subsidiary, TransAsia hopes to become a versatile carrier capable of distinguishing itself from low-budget competitors, company spokeswoman Amy Chen (陳逸潔) said.
“We aim to provide passengers with different options in terms of in-flight meal variety and check-in luggage allowances, as we position the company somewhere between the budget and full-service market segments,” Chen said.
The firm plans to release an updated business plan soon, she said.
V Air, which launched in December 2014, last year recorded losses of NT$450 million (US$14.31 million at the current exchange rate). Its bottom line continued to deteriorate, with aggregate losses in the first half of this year exceeding NT$900 million.
Amid intense competition, V Air burned through more than half of its founding paid-in capital of NT$2 billion, company data showed.
V Air has four aircraft, two of which were added to its fleet in January and March, and covers routes to nine destinations, including Thailand, Japan and South Korea.
TransAsia said that it would take over two V Air routes to Chiang Mai, Thailand, and Fukuoka, Japan, and pledged that affected passengers would be reimbursed.
The company added that V Air’s most popular destinations are Bangkok and Chiang Mai, with flights to the destinations operating at 77 percent capacity on average.
TransAsia reported a net loss of NT$439 million for the first quarter, easing from a net loss of NT$1.16 billion in the previous quarter.
Sales retreated significantly from NT$10.58 billion in the fourth quarter of last year to NT$3.2 billion in the first quarter of this year.
TransAsia shares yesterday gained 0.95 percent to NT$6.36, Taiwan Stock Exchange data showed.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday obtained the government’s approval to inject an additional US$10.26 billion to finance the construction of its second fab in Kumamoto, Japan, and a second fab in Arizona, using advanced process technologies. The Department of Investment Review approved TSMC’s investment applications on the basis that Taiwan remains a major technology and manufacturing hub for the chipmaker, which makes its most advanced chips at home, the company operates its research-and-development center here and the majority of its capacity remains in Taiwan. The latest capital injections — US$5.26 billion for its Japanese venture Japan Advanced Semiconductor Manufacturing
DIVERSIFYING: Following customers’ demand to improve supply chain resilience, ASE is looking for sites in the US, Japan and Mexico, a company executive said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it plans to launch a new high-end chip testing fab in the US next month to better serve its key customers based in North America, particularly California-based artificial intelligence (AI) customers. The new US testing facility would be operated by the firm’s subsidiary ISE Labs Inc, it said. ASE’s major customers, and high-ranking US officials and representatives from American Institute in Taiwan are to attend the fab’s opening ceremony on July 12, it said. ISE Labs last year acquired a 5,942m2 facility in San
Local companies believe that nearly a third of all job opportunities will vanish in 10 years due to the rise of artificial intelligence (AI), according to a survey released by online job bank yes123 on Tuesday. In the survey of 1,016 companies on the labor market’s third quarter outlook, the job bank focused in part on AI’s impact on workers and asked companies what percentage of jobs they felt would be lost to AI’s round-the-clock productivity and high-speed computing prowess. Respondents felt on average that 29.2 percent of job opportunities would be lost to AI over the next 10 years, but there
Taiwanese workers earned an average of NT$47,000 per month this year, but 40 percent are struggling financially and 18 percent plan to switch jobs within 12 months, two separate surveys showed yesterday. The amount equals a 5.4 percent increase from a year earlier to a decade high, 104 Job Bank (104人力銀行) said. The government is due to review the nation’s minimum wages. Employees at computer and consumer electronics manufacturers reported the highest average monthly wage of NT$60,000 a month, followed by semiconductor firms at NT$59,000, and vendors of shoe and textile products, along with software and Internet businesses at NT$55,000, 104 Job