All Nippon Airways Co. has started talks with Kansai International Airport Co. with an eye to setting up a low-cost carrier based at the Osaka Prefecture airport to operate domestic and international routes as early as next fiscal year, sources said Monday.
ANA plans to set up the subsidiary under a different brand name, and routes to be operated by the carrier are expected to mainly connect Japan with China and South Korea, the sources said.
The struggling international airport is considering building a terminal aimed exclusively at serving low-cost carriers, the sources said. ANA has judged that the business could be profitable if the airport reduces its usage fee, the sources said.
To curb costs, the carrier is likely to employ foreign pilots and flight attendants, and simplify in-flight services, they said.
ANA President Shinichiro Ito said at a shareholders' meeting in Tokyo on Monday, "As orientation for low-price (service) definitely exists among customers, we are considering how we can operate an LCC in Japan."