Japan's ANA to expand budget airline business as Q3 profit shines

ANA Holdings Inc, Japan’s biggest airline by revenue, plans to expand its budget airline business into medium-length international flights due to robust travel demand in Asia after it notched strong Q3 earnings. In a new four-year strategic plan, ANA said Thursday it also planned to use smaller jets in the Japanese domestic market to boost profits and it would look to expand its international flights to new markets such as South America, Africa and Russia. The airline said it was aiming for Y2.45t (US$22.4b) in revenue in the fiscal year 2022, up 27% from the Y1.925t seen in the current fiscal year through March. It also expects 50% growth in its core international service, in part by strengthening partnerships with foreign airlines. The carrier is a major player in the growing budget aviation market in Japan, where its brands Vanilla Air and Peach Aviation compete against Jetstar Japan, a joint venture between JAL and Qantas, as well as a newly re-launched AirAsia Japan. ANA said Tokyo-based Vanilla and Osaka-based Peach would look to launch medium-haul flights of up to eight hours flying time from Japan, from around 2020. ANA on Thursday said it planned to introduce “a new small size medium-haul aircraft” for the business, without referring to any particular model. Operating profit jumped around 25% in the three months to December, to about Y50.9b. ANA maintained its forecast that operating profit for the year to March would hit Y160b.<br/>