Japan Airlines is examining setting up a new low-fare carrier to increase capacity and take on rising competition from budget operators. Starting a discount airline is part of the carrier’s need to widen its product line-up, vice chairman Junko Okawa said Monday. It is one of several options the company is exploring, she said, adding no decision has been taken yet. The airline is already a shareholder in low-fare carrier Jetstar Japan. Asia’s budget airline revolution has been slow to sweep Japan, a market that JAL and ANA have dominated for decades. Aided by a tourism boom, low-fare carriers such as AirAsia, Jetstar Japan and Peach Aviation have in recent years tried to wean passengers away from legacy operators in a country where the Shinkansen bullet trains offer stiff competition to planes on internal routes. <br/>
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Foreign minister Julie Bishop has warned Beijing against using threats to pressure Qantas to adopt the communist party’s political line by referring to Taiwan as part of mainland China rather than a separate country. Qantas confirmed last week it was one of 36 international airlines that had received letters from the Civil Aviation Administration of China ordering them to change the way they refer to Taiwan, Hong Kong and Macau - a demand the White House has branded “Orwellian nonsense”. Bishop was less incendiary but nonetheless made it clear the private sector should not be pushed around. “The terms that private companies choose to list destinations are a matter for them,” she said. Qantas is refusing to say what China has threatened, nor what precisely China wants it to do. <br/>
American Airlines has decided to cut Chicago O’Hare-Beijing service from Oct 22 because of overcapacity in the Sino-US market–which used to be one of the most lucrative markets worldwide. “The current fare environment severely limits our ability to successfully compete between Chicago and Beijing,” American Airlines VP network and schedule planning Vasu Raja said May 2. American launched the nonstop route in May 2010, and competes with Hainan Airlines and United Airlines; each carrier operates a daily flight on the route. According to the US DoT, the Beijing-Chicago O’Hare route saw the biggest decline—16.4%—in passenger boarding for the first 10 months of 2017 among all Sino—US routes. Passenger load factors have averaged 80.9% in the same timeframe. <br/>