ANA uses brand to hire pilots for low-cost wings

ANA is stepping up efforts to ensure it has enough pilots for its low-cost subsidiaries in the face of a worldwide crew shortage and fierce competition in the no-frills sector. The airline will pay Y30.4bn ($265m) next month to acquire a supermajority position in Peach Aviation, the low-cost carrier in which it already holds a 38.7% stake.  ANA will acquire the additional 28% from the public-private Innovation Network Corporation of Japan and First Eastern Aviation, an investment fund in Hong Kong. The broad explanation for the consolidation is that it will “accelerate Peach’s growth in its next phase of development”. But behind that, the company acknowledges, is a more immediately critical incentive: the raised stake will legally allow Peach to recruit senior pilots and other crew with advertising that uses the supposedly more alluring ANA brand. That ability, say people in the industry, could prove pivotal for Peach as Japan’s low-cost carriers strive towards the 20-30 per cent market penetration enjoyed by counterparts in Europe, the US and elsewhere in Asia. Low-cost penetration levels in Japan stand at a little more than 10%, a reflection of the popularity of bullet trains for domestic travel and the challenge to convince conservative travellers they are reliable, respectable alternatives to ANA and JAL, the big incumbents. Japanese budget airlines are barred from training pilots from scratch and are forced into a recruitment market where their brands are less known or attractive to the experienced crew they need. Peach’s ability to recruit using the ANA brand, said an airline official, could make a substantial difference.<br/>