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Tuesday, April 21, 2015

Budget airlines see booming business from China

(Want China Times) Tiger Airways (Taigerair), a budget airline from Singapore, recently signed a deal with Chinese travel site Qunar.com to establish a flagship shop there, becoming the first international budget airline to launch a flagship shop on the popular website.

Before cutting the deal with Qunar, the major marketing channel of Tigerair was through its own website.

"The page of our flagship shop on the Qunar site is in Chinese and the purchase process will be more close to the habits of Chinese consumers and more suitable for payment methods of Chinese consumers. We are confident of attracting more Chinese consumers to experience Tigerair," a company spokesperson said.

Tigerair offers flights to 11 cities in the Greater China region and the region now accounts for 20% of its market. Last year, it began offering flights to Ningpo, Xi'an, Guilin and Nanning, which are second- and third-tier cities, the most welcome markets for budget airlines in the area.

As of the first quarter of this year, 123 airlines had signed deals with Qunar, including 30 domestic airlines.

Shanghai's China Business News noted that a report on budget airlines in Asia and Pacific by Expedia, one of the world's largest online travel companies, found that 94% of potential customers would be willing to choose budget airlines. By the end of March, the number of budget airline flights is expected to grow by 9.5% from the same period of last year.

Faced with the onslaught of low-cost budget airlines, quite a number of traditional airlines have diversified into the low-cost market to engage in direct competition.

"Budget airlines mainly use narrow-body airplanes and the flights usually are less than five hours. 

This means that on flight routes in Southeast Asia, Japan and South Korea, the market shares of traditional airlines are feeling the increasing impact of budget airlines," one local airline executive said.

However, the executive also said that with the US easing its visa policies, the American market, which requires wide-bodied aircraft to serve its long-haul routes, will see decent demand this year.

Source: Want China Times


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