Tigerair Taiwan Ltd (台灣虎航), a subsidiary of China Airlines Ltd (CAL, 中華航空), on Tuesday last week said its turnaround is intact and it expects to wipe out its accumulated losses in four years’ time.
The budget carrier has been in the black since the beginning of this year and has posted a net income of NT$174 million (US$5.76 million) for the first six months.
That compares with a net loss of NT$420 million during the same period last year.
Tigerair Taiwan became a fully owned subsidiary of CAL in January following a break with a Singaporean partner.
“The company has posted consecutive monthly sales growth as of the end of last month,” company chairman Chang Ho-jo (張鴻鐘) said.
The carrier saw its load factor surge to 85 percent during the summer peak season between July and last month, which, along with its growing chartered flight business, helped boost earnings, Chang told a news conference held to mark the third anniversary of the company’s establishment.
Despite the bright outlook, the carrier is still facing challenges, such as the limited size of its home market and difficulties in expanding to new routes.
In light of the challenges, the company said it has diversified its business model to include regular flights and chartered flight arrangements made with a network of travel agencies.
While chartered flights are less profitable, they offer a steady revenue stream at no additional operating costs while lowering the company’s average fixed costs, Chang said, adding that chartered flights make up 10 percent of the company’s capacity.
The company is competing against 22 other low-cost carriers that fly to Taiwan, he said, adding that its greatest rivals are Japan’s Vanilla Air Inc and Peach Aviation Ltd.
The company said it would focus on Japan, South Korea and Macau, and would launch flights between Kaohsiung and Fukuoka on Dec. 18.
Regarding route expansions into Southeast Asia, Chang said that the company is facing difficulties securing time slots to land at busy airports at popular destinations such as Bangkok.
“The authorities there would not even grant us red-eye flights,” Chang said.
The company operates a fleet of 10 Airbus A320s and is to receive the 11th airplane in November.
Separately, CAL on Saturday held an event at Huashan 1914 Creative Park in Taipei to mark the resumption of its direct flights between Taipei and London.
CAL started direct flights between Taiwan Taoyuan International Airport and London Heathrow Airport in March 2011, but suspended the service one year later.
The airline said it would operate four direct flights to London’s Gatwick Airport every week from Dec. 1.
Additional reporting by CNA
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