Global Airport News

Japan's All Nippon Airways is to seek investment from overseas airlines and investment funds to help set up a low-cost carrier which it aims to launch as early as next year, the Nikkei business daily said on Monday.

The move is ANA's response to growing competition from Chinese and South East Asian discount airlines that launched flights to Japan following an "open skies" aviation agreement to liberalise civil aviation markets.

ANA plans to set up a low cost carrier (LCC) that will offer flights at less than half the price of major carriers for international routes within six hours of Japan, the Nikkei said.

The Japanese airline will likely take a 30-50 percent stake in the discount carrier which is expected to have an initial capital of more than JPY¥50 billion (USD$578.4 million). Overseas airlines and funds will probably have a combined holding of less than 30 percent, the paper said.

Japan's second-biggest airline will also seek investment from Japanese travel agencies and hotels to offer wider services, the paper said, adding that the carrier would decide partners next month.

ANA's president Shinichiro Ito said in April the carrier was "seriously considering" the possibility of starting an LCC, although it would need to find airports that are open 24 hours a day and with low landing fees.

An ANA spokeswoman said there was no new information about its LCC plans.

LCCs have been on the increase throughout the world, but Japan has always been a difficult market due to higher staffing costs, limited slot availability at key airports and expensive landing fees.

The Nikkei report said the new budget carrier would not operate under the ANA brand, and its salary system would also be different from the existing one for ANA employees.