Japan Airlines (JAL) plans to establish a new low cost carrier (LCC) specializing in long-haul international routes, the Japanese flag carrier announced Monday.
JAL unveiled the plan in its fiscal-year 2017 to 2020 Group Medium Term Management Plan, which also falls under the domain of the larger 10 Year Grand Design strategy. With the LCC, JAL hopes to capitalize on the low cost long-haul sector from Asian customers and attract more inbound passengers, especially given the stagnation of traffic growth among outbound Japanese passengers.
JAL said that it plans to formally establish the as yet unnamed airline, based at Tokyo’s Narita International Airport, by July.
Timing plans call for first commercial operation by the summer 2020, before the Tokyo Olympics and the completion of construction in the airport terminals. Narita airport is now undergoing major refurbishment to increase the handling capacity of its terminals and facilities for the Olympics.
JAL has yet to announce its stake in the venture but welcomed investors to “expand the business model.”
The LCC will begin with a pair of Boeing 787-8s, concentrating on destinations in North America, Europe, and Asia. Whether or not JAL plans to transfer some of its own 787-8s to the new entity remains uncertain, but currently it flies 25 787-8 in active service and four more on order. Jetstar Japan, also a JAL joint venture, will continue to focus on short-haul destinations.
Singapore’s Scoot already uses the 787-8 for long-haul destinations, to Athens and Honolulu, via Osaka. Other long-haul LCCs that serve Japan include Air Asia X and Jetstar.