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Airasia Next New Hub, Hongkong?  
User currently offlineLeonJunior From New Zealand, joined Aug 2007, 113 posts, RR: 0
Posted (5 years 2 weeks 3 days 7 hours ago) and read 4275 times:

Sources from Wikipedia http://en.wikipedia.org/wiki/Airasia the last line of first paragraph
and Tony Fernandes facebook's comment
http://www.facebook.com/tonyfernandes?v=feed&story_fbid=102092144495

Does anyone has any more information about this?
Wonder what would be CX reaction.

Anyway, Good for Hongkong. First truly low-cost airline.

14 replies: All unread, jump to last
 
User currently offlineGabrielchew From United Kingdom, joined Aug 2005, 3203 posts, RR: 12
Reply 1, posted (5 years 2 weeks 3 days 7 hours ago) and read 4261 times:

I'm so surpised no one has entered the low cost market in HKG properly before (HK Express doesn't count). There is so much traffic going into HKG, and it's nearly all on full service carriers - just a shame it's on Air Asia. Oasis HK shouldn't have been there long ago.


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User currently offlineB747-4U3 From United Kingdom, joined Jan 2002, 990 posts, RR: 0
Reply 2, posted (5 years 2 weeks 3 days 6 hours ago) and read 4227 times:



Quoting Gabrielchew (Reply 1):
I'm so surpised no one has entered the low cost market in HKG properly before (HK Express doesn't count). There is so much traffic going into HKG, and it's nearly all on full service carriers - just a shame it's on Air Asia. Oasis HK shouldn't have been there long ago.

I think the problem is that it isn't very hard to find a good deal on Cathay Pacific or any of the other big airlines. I've recently flown from HKG to HND with ANA for under HK$2500 return and HKG to KUL with CX for under HK$1500 return. Considering that CX and NH offer all of the thrills, Air Asia would have to have some bloody low fares to lure people away from the majors. One of the flaws with Oasis is that in Economy class they were very rarely any cheaper than anyone else.

In my opinion, for this venture to be successful Air Asia would have to go for the secondary or tertiary markets such as Daegu, Hiroshima, Kitakyushu or Shizuoka. The only way CX compete on routes like that would be to use Dragonair's narrow bodied planes, but I doubt they could get their costs down to the level of Air Asia and would therefore have to endure heavy losses or ignore that market altogether.


User currently offlineArticulatexpat From Hong Kong, joined Sep 2006, 156 posts, RR: 1
Reply 3, posted (5 years 2 weeks 3 days 6 hours ago) and read 4191 times:

Are you talking about the comment where he says 'HK is a new venture'? Interesting. I checked that Wikipedia link and found a reference to a Chinese-language news article, which I can't read. I wonder how that would work out and what cities they'd serve. There are a lot of flights to the major and secondary mainland cities on the mainland carriers, against whom it would be hard to compete on price. Dragonair's got a great HK-to-mainland route network, also. CX has a lot of brand loyalty and tie-ins with local businesses, so it's hard to see Air Asia mounting serious competition on more than a few leisure routes.

I think Hong Kong Airlines would be harder hit than Cathay/Dragonair. HK Airlines and its subsidiary/parent/sibling/whatever Hong Kong Express lack brand coherence, and despite all their ads on taxis, I don't think they have developed great brand awareness here, either. Although I've read good things about them on Skytrax and heard positive things from friends who've flown them, their fares are often higher than CX's. They serve a pretty good mix of leisure and business routes, but I think they're a lot more vulnerable than CX.

If Air Asia were to start out with a few mainland destinations (offering Lijiang would be a stroke of brilliance) as well as routes to, say, Kota Kinabalu, Phuket, Penang, and/or Denpasar, they could really make it work. It's going to boil down to the destinations they choose, I think.


User currently onlinePe@rson From United Kingdom, joined Jan 2001, 19196 posts, RR: 52
Reply 4, posted (5 years 2 weeks 3 days 6 hours ago) and read 4173 times:



Quoting Articulatexpat (Reply 3):
Penang,

PEN-HKG-PEN already announced by AK. Available for booking and 4x weekly.



"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
User currently onlinePe@rson From United Kingdom, joined Jan 2001, 19196 posts, RR: 52
Reply 5, posted (5 years 2 weeks 3 days 5 hours ago) and read 4065 times:



Quoting B747-4U3 (Reply 2):
I doubt they could get their costs down to the level of Air Asia

Indeed.

In actuality, AK's costs are lower than FR's, which isn't surprising if you think about it.

Quoting Gabrielchew (Reply 1):
just a shame it's on Air Asia

What's wrong with AirAsia? I have flown it plenty of times and had no issues - and I paid almost nothing each time.



"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
User currently offlineOlympic472 From United States of America, joined Jun 2008, 456 posts, RR: 0
Reply 6, posted (5 years 2 weeks 3 days 4 hours ago) and read 3943 times:

Some thoughts about this:
With major airlines frequently discounting their fares and other airlines offering low fares, the entry of another low-cost airlines may open up more choices, but why will consumers choose them?
There are already quite a few low-cost airlines flying into HKG (Jetstar, Cebu Pacific).
HKG is a competitive market, especially for regional flights.

I think Air Asia must flood HKG with frequencies as well as destinations to make it work.
This will be interesting to watch.



Civil Aviation has a "Need for Speed"!
User currently offlineArticulatexpat From Hong Kong, joined Sep 2006, 156 posts, RR: 1
Reply 7, posted (5 years 2 weeks 3 days 4 hours ago) and read 3863 times:



Quoting Pe@rson (Reply 4):
PEN-HKG-PEN already announced by AK. Available for booking and 4x weekly

Awesome! Thanks for that info.

Quoting Olympic472 (Reply 6):
There are already quite a few low-cost airlines flying into HKG (Jetstar, Cebu Pacific).

There are a few, but none that are based here. Hong Kong Airlines/Express isn't an LCC/LFC, although its mainland flights aren't usually expensive. They have to be cheap, because the mainland carriers almost always offer bargain-basement fares. Jetstar only flies to Singapore from here. Cebu Pacific serves (if Wikipedia's accurate) Manila, Clark, Cebu, and (seasonally) Davao. I think there's room for Air Asia to open a hub or focus city operation here, provided they choose destinations sensibly.

Quoting Olympic472 (Reply 6):
HKG is a competitive market, especially for regional flights.

I think it depends on which part of the region you're talking about. There are a lot of flights to certain places: the mainland, Taipei, Bangkok, and Singapore. To other destinations, not so much. If my experience and that of other people I know is indicative of anything, there's room for more service to Bangkok, despite the number of carriers and flights on the route now. There may be restrictions on the number of flights allowed between here and Indonesia, but Denpasar would seem to be a no-brainer, as would KK and Kuching in East Malaysia. Hanoi's close enough to make sense. Maybe Siem Reap and Phnom Penh. Sanya and Haikou on the mainland's Hainan Island. There's room for more, believe me. I think Air Asia just needs to choose wisely, not...

Quoting Olympic472 (Reply 6):
flood HKG with frequencies as well as destinations to make it work.



User currently offlineMillwallSean From Singapore, joined Apr 2008, 1240 posts, RR: 6
Reply 8, posted (5 years 2 weeks 2 days 18 hours ago) and read 3592 times:



Quoting Olympic472 (Reply 6):
I think Air Asia must flood HKG with frequencies as well as destinations to make it work.
This will be interesting to watch.

To the contrary flooding is the last they should do. There is no need for it and to much frequency will bleed money for AK. Frequency is one of the most overrated things, something clearly shown by the US market.

Most of the businessmarket will choose CX, but all the VFR and tourists will be happy to have an option.

AK will start with their homemarkets, Malaysia, Thailand etc and then slowly increase to markets where they have the rights to fly.

I know AK wanted to fly out of HK very early on but found the airport costs to high. Last year they changed their mind, I would assume they got a good deal when HK saw them starting successful flights to the surrounding airports.



No One Likes Us - We Dont Care.
User currently offlineLeonJunior From New Zealand, joined Aug 2007, 113 posts, RR: 0
Reply 9, posted (5 years 2 weeks 2 days 8 hours ago) and read 3413 times:



Quoting Articulatexpat (Reply 3):
Are you talking about the comment where he says 'HK is a new venture'? Interesting

Yes

Quoting Olympic472 (Reply 6):
With major airlines frequently discounting their fares and other airlines offering low fares, the entry of another low-cost airlines may open up more choices, but why will consumers choose them?

Airasia could sometimes offer upto zero fares(exclude airport tax) which I dont think any other airlines in the region could do so. They are the lowest cost airline in the world. They are the first airline to abolish administration fees and so on.
With their strong bases and brand in Southeast Asia and soon the world, it wouldn't be hard for them to for first fly to their existing bases around Southeast Asia and later on develop new unique destinations with their strong strategies.

There is still very strong untapped low cost market in Hongkong. I think they will get quite a high yield out of Hongkong.


User currently offlineCX Flyboy From Hong Kong, joined Dec 1999, 6588 posts, RR: 55
Reply 10, posted (5 years 2 weeks 2 days 6 hours ago) and read 3296 times:

On a similar vein, ANA's planned low-cost division which they have long said will be based outside japan, in an Asian city has been delayed. Paperwork had been filed already with the Hong Kong CAD to apply for the AOC etc...

User currently offlineCoal From United States of America, joined Aug 2006, 1994 posts, RR: 9
Reply 11, posted (5 years 2 weeks 1 day 15 hours ago) and read 3055 times:



Quoting B747-4U3 (Reply 2):
I think the problem is that it isn't very hard to find a good deal on Cathay Pacific

Agreed. PVG-HKG-SFO return at US$780 inc all taxes and fees is cheaper than some domestic flights in the US!

Cheers
Coal



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User currently offlineLifelinerOne From Netherlands, joined Nov 2003, 1917 posts, RR: 7
Reply 12, posted (5 years 2 weeks 1 day 13 hours ago) and read 2982 times:



Quoting LeonJunior (Thread starter):
First truly low-cost airline.

Wasn't Oasis Airlines the first low-cost-airline from Hong Kong?

Quoting Pe@rson (Reply 5):
In actuality, AK's costs are lower than FR's, which isn't surprising if you think about it.

No, labor costs would be way less than in Europe and they normally are one of the biggest costs you have.

Cheers!  wave 



Only Those Who Sleep Don't Make Mistakes
User currently onlinePe@rson From United Kingdom, joined Jan 2001, 19196 posts, RR: 52
Reply 13, posted (5 years 2 weeks 1 day 9 hours ago) and read 2889 times:



Quoting LifelinerOne (Reply 12):
Quoting Pe@rson (Reply 5):
In actuality, AK's costs are lower than FR's, which isn't surprising if you think about it.

No, labor costs would be way less than in Europe and they normally are one of the biggest costs you have.

Hence "which isn't surprising if you think about it."



"Everyone writing for the Telegraph knows that the way to grab eyeballs is with Ryanair and/or sex."
User currently offlineSurfandSnow From United States of America, joined Jan 2009, 2856 posts, RR: 30
Reply 14, posted (5 years 2 weeks 9 hours ago) and read 2660 times:

Now one thing I've always wondered...what is the travel situation between various Asian markets? For instance, does HK require onerous visas for Indonesians, does Japan make Thais go through similarly complex visa procedures, do Malaysians face hassles when going to South Korea, etc?

Certainly, Americans and Canadians have it easy when traveling around North America, and Europeans similarly have an easy go of things when going around that continent, and even Middle Eastern citizens get around the GCC easily, but I've always wondered what the deal is in East Asia....Noxious travel restrictions could certainly make a truly comprehensive regional operation difficult!



Flying in the middle seat of coach is much better than not flying at all!
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