Japan Airlines to expand budget carrier’s fleet after 2020 launch

SYDNEY (Reuters) – Japan Airlines Co. Ltd. hopes to expand the fleet of a new low-cost carrier by two jets a year after it launches in mid-2020, a director of the airline said on Monday, as it takes on rival ANA Holdings, Inc.’s budget arm Peach.

"In the case of Japan Airlines we can introduce five or six aircraft a year based on our size. Maybe two aircraft a year is very challenging for a new airline but we hope they can expand at that kind of pace," said JAL director Masaru Onishi on the sidelines of an airline industry conference.

The new airline, which will offer medium and long-haul flights, will be designed to cater to a broad group of Japanese and foreign passengers and will take a more experimental approach to its product than the full-service parent carrier, Onishi, a former chairman of JAL, said.The yet-to-be-named carrier will offer a mix of budget and premium options for meals and seats, depending on what passengers are willing to pay, Onishi said.

The airline, which will launch with its first two Boeing Co 787-8 Dreamliners, will also operate to some of the same destinations that Japan Airlines already serves because it caters to a different demographic, he said.

JAL, which operates the short-haul low-cost Jetstar Japan joint venture with Australia's Qantas Airways, is setting up the new airline to compete against Peach as Japan benefits from a boom in international tourists.

Peach is set to launch medium-haul international flights in 2020 after merging with ANA's other budget carrier, Vanilla.