Will the risks by low cost #airlines payoff in #Japan?

Low cost airlines have generally been interested Japan for the various appeals associated with the land of rising sun, one of which is tourism. Japan has always been a popular destination for tourists, with its ultra-modern and quirky Tokyo and traditional and cultural suburbs. However, this trend has seen a downturn in recent times, mainly due to the series of earthquakes in March, with the radiation scare making matters worse.

Yet this has not discouraged low cost airlines; in fact new players are entering the low cost market. All Nippon Airways and Japan Airlines are launching low cost carriers to serve the Tokyo metropolitan area. They will, thus, add their names to the list of nine other no-frills airlines already providing service in Japan. Not only are these airlines Japan’s leading flagships, but they will also be providing service in Tokyo, a market area that has traditionally proved to be a thorn in the side for LCCs.

The LCCs will not only have to face increased competition in Japan but will also have to battle with some of the highest recorded landing fees as well as the aircraft fuel tax. Perhaps they believe that the increased margins of LCCs will offset the cost. Or, maybe the strategy of these airlines is to manipulate the downturn to their benefit. Residents might be influenced to travel low cost rather than spend more on premium air travel. Also, tourists might be lured to travel to Japan thanks to the “it’s cheaper than ever” marketing schemes.

Will the risks by these airlines succeed? To know more about the strategy of LCCs visit Low Cost Airlines Congress 2011.