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Fearful carriers promised new international routes

The government said it will help Far Eastern Air Transport Corp (遠東航空), Transasia Airways Corp (復興航空) and other carriers find new routes to compensate for an expected drop in passenger num-bers once the high-speed train service begins operations.

Taiwan is in talks with other governments to let the smaller carriers fly international routes.

These flights might include destinations such as Bali, Vladivostok and South Korea's Jeju island, Minister of Transport and Communications Lin Ling-san (林陵三) said in an interview in Taipei.

"We're trying to expand routes for the airlines," Lin said. With the new routes, "their fleets won't go idle," he said.

Four of the nation's six airlines operate mostly domestic routes. They need to find new routes to compete with the two international carriers, China Airlines (華航) and EVA Airways Corp (長榮航空) and with the high-speed train service that will begin service at the end of next year.

On the GRETAI securities market, Far Eastern Air shares rose almost 7 percent to close at a three-month high of NT$6.20. Shares of Transasia are not publicly traded.

Air travel on routes along the western coast is estimated to fall by 50 percent to 70 percent once the high-speed rail service commences, the transport ministry said.

Trains will travel at an average speed of 200kph, cutting travel time between Taipei and Kaohsiung by two-thirds to 90 minutes.

Air travel between Taipei and Kaohsiung takes about 50 min-utes, excluding time needed for security checks and other pre-flight measures.

The proposed new routes may not be enough to help the airlines stay competitive, because the flights will be flying to or from "second-tier" cities, compared with destinations like Tokyo and Hong Kong, said D.C. Wang, an analyst at Yuanta Core Pacific Capital Management Co (元大京華證券) in Taipei.

"They will be under pressure to consolidate after the high-speed rail begins operating," he said.

New air routes that are under discussion include a Taipei-Vladivostok service, a Kinmen-Singapore route and new flights from Taichung to unspecified Japanese cities, Lin said.

Mandarin Airlines (華信航空), a unit of the nation's largest carrier, China Airlines, this week introduced charter flights to Seoul.

Lin declined to disclose further details.

"It's inconvenient to talk about those involving country-to-country negotiations," he said.

China Airlines and EVA Airways, the nation's two biggest airlines, will be able to continue operating services between Taipei and the capitals of other countries, Lin said.

Any change in allocation of the routes will depend on the capacity of the airlines, he said.
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