China Airlines Ltd (CAL, 中華航空) yesterday said that its low-cost carrier Tigerair Taiwan (台灣虎航) returned to profit last month, following the ending of the subsidiary’s partnership with a Singaporean peer.
Tigerair Taiwan, a joint venture between CAL and Tiger Airways Singapore Pte Ltd, became the Taiwanese carrier’s wholly owned subsidiary after it bought back a 10 percent stake held by its Singaporean partner for an undisclosed amount in December last year.
The low-cost carrier has been struggling since it began operations in 2014.
“Tigerair Taiwan will be operated as an independent brand, and we believe that the change would bolster the company’s image among consumers,” Tigerair Taiwan chief financial officer and spokesperson Hansen Lin (林俊男) said.
Lin attributed the company’s recent turnaround to scrapping loss-making routes and adding flights to popular destinations.
The company has been cutting back routes to destinations further than four hours flight time from Taiwan in favor of flights of between two and three hours, which suits the low-cost carrier model, Lin said, adding that among new destinations that are to be introduced this year are Jeju Island and Daegu in South Korea.
Sales from travel agencies increased last month, Lin said, adding that backpackers were previously the company’s major source of revenue.
He said he expects the company’s average passenger load factor to improve to 80 percent by the end of this year, from its present 70 percent.
Meanwhile, Mandarin Airlines (華信航空), another CAL subsidiary focusing on regional and domestic flights, is to see a significant expansion of its fleet this year, CAL chairman Ho Nuan-hsuan (何煖軒) said.
Mandarin Airlines is to form a second fleet this year, with aircraft procurement slated to be completed in the first half, Ho said.
“We will not be looking for new aircraft, as there are many used jets on the market right now,” Ho said, while declining to confirm if the company is eyeing the assets of shuttered TransAsia Airways Corp (復興航空).
“Mandarin Airlines has a fleet of six jet airliners and we are looking to dispose of them and lease aircraft suitable for short-haul flights of about two hours,” Ho said.
Ho gave an upbeat outlook on CAL, saying that newly added direct flights to Europe have been running at near full capacity.
However, the company has pushed back the launch of direct flights to London to near the end of this year due to delays in the delivery of its new Airbus SAS A350 jets, Ho said.
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