ANA Holdings is considering drastically expanding international flights on its low-cost carrier Vanilla Air, mainly on routes linking Japan with China and Southeast Asia, group officials have said.
ANA Holdings aims to take the step by fiscal 2020, which includes the period of the Tokyo Olympics, as demand from passengers from other Asian countries is expected to continue growing, the officials said.
Based at Narita airport in Chiba Prefecture, Vanilla Air operates international flights that mainly connect Japan with destinations such as Taipei, Hong Kong, Ho Chi Minh City in Vietnam and the Philippines island of Cebu.
“We’ll expand its operations mainly in Asian markets, where business opportunities abound,” ANA Holdings President Shinya Katanozaka told a news conference on Wednesday.
Katanozaka appeared eager to open new routes that will link Japan with mainland China and Southeast Asian countries.
ANA Holdings, the parent of All Nippon Airways, also aims to expand Vanilla Air’s flight network to the U.S. west coast in the future, sources said.
The ANA group has another low-cost carrier unit, Peach Aviation, based in Tajiri in Osaka Prefecture.
Peach Aviation marked an operating profit for the fourth straight year in fiscal 2016, which ended in March, by keeping its costs low through efficient use of aircraft.
Meanwhile, Vanilla Air slipped back into an operating loss in fiscal 2016 due to severe competition on popular routes after achieving its first operating profit the previous year.
ANA Holdings hopes to double the combined revenues at the two LCC units to some ¥210 billion in fiscal 2020 from the fiscal 2017 level.