Gabrielchew From United Kingdom, joined Aug 2005, 2512 posts, RR: 13 Reply 1, posted (3 years 11 months 1 week 3 days 19 hours ago) and read 3538 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.
B747-4U3 From United Kingdom, joined Jan 2002, 983 posts, RR: 0 Reply 2, posted (3 years 11 months 1 week 3 days 19 hours ago) and read 3504 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.
Articulatexpat From Hong Kong, joined Sep 2006, 155 posts, RR: 1 Reply 3, posted (3 years 11 months 1 week 3 days 19 hours ago) and read 3468 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.
Olympic472 From United States of America, joined Jun 2008, 407 posts, RR: 0 Reply 6, posted (3 years 11 months 1 week 3 days 17 hours ago) and read 3220 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.
Articulatexpat From Hong Kong, joined Sep 2006, 155 posts, RR: 1 Reply 7, posted (3 years 11 months 1 week 3 days 16 hours ago) and read 3140 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.
MillwallSean From Brunei, joined Apr 2008, 1121 posts, RR: 5 Reply 8, posted (3 years 11 months 1 week 3 days 7 hours ago) and read 2869 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.
LeonJunior From New Zealand, joined Aug 2007, 113 posts, RR: 0 Reply 9, posted (3 years 11 months 1 week 2 days 21 hours ago) and read 2690 times:
Quoting Articulatexpat (Reply 3): Are you talking about the comment where he says 'HK is a new venture'? Interesting
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.
CX Flyboy From Hong Kong, joined Dec 1999, 6364 posts, RR: 56 Reply 10, posted (3 years 11 months 1 week 2 days 19 hours ago) and read 2573 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...
SurfandSnow From United States of America, joined Jan 2009, 2614 posts, RR: 31 Reply 14, posted (3 years 11 months 1 week 22 hours ago) and read 1937 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!