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Major airlines, low-cost carriers in Japan fiercely compete over Asia flights

A Singapore Airlines seat inside a Boeing 787-10 plane, for flights between Japan and Singapore, is seen at Singapore Changi Airport, on March 28, 2018. (Mainichi)

TOKYO -- Major airlines and low-cost carriers (LCCs) in Japan are stepping up competition to draw customers as the number of people from Asian countries wanting to visit the country surges.

LCCs are expanding their routes across Asia and trying to appeal to middle income earners, while the mega airlines are introducing luxurious planes in a move to entice more affluent passengers.

A representative for Singapore Airlines, which is renowned for its top-notch service, emphasized the appeal of the airline's business-class seats. "Passengers can really relax because it feels like being in a hotel," the representative said. Business class passengers have reclining seats that can be tilted back to provide comfy flat beds roughly 2 meters long -- complete with magazine pockets and mirrors.

In annual surveys conducted by AB Road Research Center, Singapore Airlines came out on top for airline satisfaction for five consecutive years until 2016 due to high passenger comfort levels, particularly in business class. In 2017, however, the firm was overtaken by both Japan Airlines Co. (JAL) and All Nippon Airways Co. (ANA) and dropped to fourth place. Nevertheless, the company is determined to turn things around, and on May 3, it will introduce cutting-edge Boeing 787-10 models on its regular route to Kansai International Airport, becoming the world's first airline to do so. The company will also introduce 787-10s to its Narita International Airport route on May 18, and for flights to Chubu Centrair International Airport and Fukuoka by the end of the year.

JAL, which topped the list for the first time since the start of the survey, progressed from fourth spot in previous year by boosting passenger comfort. ANA, which came second, plans to introduce new aircraft in fiscal 2019.

"Customer satisfaction increases drastically if you modernize the fuselage. Fierce competition in the airline industry has led to companies renewing their planes at an accelerated pace," says an industry source.

A key factor behind the major firms' drive to increase satisfaction levels has been greater competition with LCCs. According to Japan Aircraft Development Corp., the number of airline passengers in the Asia-Pacific region is tipped to increase at an average pace of 5.5 percent per year over the next 20 years, with the number in 2036 predicted to be about three times what it is now.

As of the end of 2017, 60 firms were involved in the Asia-Pacific LCC market. In 2016, LCCs accounted for 18.9 percent of international air travelers to and from Japan, meaning that around one in five passengers use LCCs.

In the past, LCCs focused on low-cost, short-distance flights, but they have recently been taking on middle-distance flights in Asia too, putting pressure on the major carriers.

In April, The AirAsia Group, a Malaysian LCC, launched its Bangkok to New Chitose route, and plans to introduce a Jakarta-Narita route on May 2. Similarly, the Australian Jetstar Group launched a route between Clark International Airport on Luzon Island, Philippines, and Kansai International Airport in March -- the world's first direct flight between the two locations.

ANA Holdings is also getting on the act. In March, it announced the planned merger of Peach Aviation and Vanilla Air, with the aim of expanding low-cost flights across Asia under the "Peach" brand."

Tadayuki Yoshikawa, editor-in-chief of the airline business magazine, "Aviation Wire," underscored the importance of passenger comfort.

"Unless firms work hard on various aspects of in-flight comfort, they will not be able to survive," he warned.

(Japanese original by Akane Imamura, Business News Department)

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