As ZIPAIR launches passenger operations as JAL’s long-haul LCC subsidiary, Japan’s other major airline is set to follow suit. The ANA Group announced this week that it will bring a new new carrier to life, sitting between its flagship ANA service and short-haul LCC Peach. The company intends for this new airline “to raise profits by targeting demand for low-cost, medium-distance flights to destinations in Southeast Asia and Oceania.”
The new brand, as-yet-unnamed, aims to launch in early 2022. ANA Holdings expects it will begin operations soon after it is established by taking advantage of the existing Air Japan operating certificate and infrastructure. Air Japan operates a mix of 767-300 and 787 models for ANA today on regional routes across Asia.
Higher density for higher profits
The new carrier will also lean on ANA’s existing fleet of 787 Dreamliner aircraft. But these 787s will not fly as they are configured today.
The new 787 layout will feature 300+ seats, leaning hard into the LCC approach to the market, though it will still offer a business class option. While the carrier flies a 395 seat 787-9 layout and a 335 seat 787-8 for domestic service its typical configuration for international markets holds roughly 50-60% of that number of passengers on board.
Additional details on other amenities remain unclear, though it seems likely that the existing inflight internet service will remain on the planes. An in-seat embedded entertainment system is less clear, as the company will likely be choosing a new seat for the service.
A dramatic shift in demand profile
In announcing the move ANA Holdings is conceding that the demand profile for air travel has shifted permanently. The company believes that “Demand from business travel will decrease and likely not fully return to previous levels due to changes to the nature of work, such as the widespread popularity of online conferences and meetings,” for example. But leisure and VFR traffic “will likely continue to remain robust, with potential growth from new segments including new working environments and multiple residency.” Given that shift the first class luxury is disappearing, to be replaced with a more utilitarian option for mid-haul international markets.
The carrier plans to remove 35 aircraft from its fleet this year, including 22 Boeing 777s. Including the Peach subsidiary this represents a 10% cut in fleet size.
ANA also confirms that the third and final A380 in its order book is deferred; it did not provide an updated timeline for when it expects the A380 or one pending 777-300ER delivery to take place. While the A380 serves the heavily leisure-focused markets of Hawaii the 777-300ER is a luxury layout; the first of the planes carrying the current configuration served London as it entered service last year.
An end to the Pan Am era
When Pan Am World Airways dissolved in 1991 one portion of the business remained: the International Flight Training Academy in Miami. It is currently owned by ANA Holdings, and will be shut down as part of ANA’s efforts to stem losses.
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