Budget airlines operating in Japan have been hit hard by the coronavirus pandemic, with many struggling due to huge declines in passenger demand.
AirAsia Japan will close all four routes in the country on Dec. 5. and fire all of its nearly 270 employees in stages.
“We have concluded that it would be an extremely challenging feat for us to continue operating without any visibility and certainty of a postpandemic recovery path,” Chief Operating Officer Jun Aida said in a statement earlier this month.
A budget airline needs to have a seat occupancy rate of as high as some 80% to be profitable. But the pandemic has made it difficult to achieve that threshold.
Jetstar Japan will suspend flights on six of its 23 Japan routes this month through late March next year. It has offered buyout packages to pilots and cabin crew members.
Zipair Tokyo started operations in Japan this year, but has not carried any passengers, providing only cargo services on routes to Bangkok and Seoul from Narita International Airport near Tokyo.
The Japan Airlines unit is scheduled to start carrying passengers on the Seoul route on Friday.
Zipair Tokyo “was able to make the decision because it is being supported by revenue from cargo services. It would be difficult to make profits on passenger flights alone,” a company official said.
Larger Japanese airlines have also been struggling with the impact of the pandemic.
ANA Holdings Inc.’s All Nippon Airways plans to skip winter bonus payments for the first time in its history in a broader plan to cut annual employee pay by some 30% on average.
JAL reduced summer bonus payments while rushing to cut other costs.
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