ANA chief hopes budget carriers will create new aviation demand

All Nippon Airways Co. President Shinichiro Ito said Thursday he hopes the launch of two ANA-affiliated low-cost carriers will create new demand for air travel.

Despite Japan's declining population and intensifying competition with other modes of transportation, the number of landing slots at airports in the Tokyo metropolitan area has been increasing rapidly, raising the need for air carriers to swiftly compile business strategies, Ito said.

"We would like to create more opportunities for customers, including those who have never used airplanes, to fly by setting up two companies that are totally different from the ANA brand, from a perspective of generating new aviation demand," Ito told a news conference at the Foreign Correspondents' Club of Japan in Tokyo.

ANA took part in setting up the two budget airlines in Japan. AirAsia Japan Co., a joint venture with Malaysia's AirAsia Bhd., is scheduled to start operating next August, while Peach Aviation Ltd. will start services in March.

Regarding the all-new Boeing 787 Dreamliner aircraft, which ANA is the first airline in the world to begin using, Ito voiced high expectations for the benefits the medium-sized aircraft will bring to his company.

"(The Boeing) 787 is said to be a game changer. Its fuel economy is 20 percent better than conventional aircraft and it can fly long-haul routes which do not generate sufficient demand for large-sized aircraft," Ito said. "We have great hope that it will significantly boost our business."

Though the carrier's operations were negatively affected by a more than three-year delay in delivery of the aircraft from Boeing Co., it did not significantly change the carrier's business plan as the company took measures such as postponing the retirement of some aircraft, Ito said.

Ito said ANA is in talks with Boeing over compensation and has almost reached an agreement, but stopped short of revealing details.

The president also apologized for an incident in which an ANA jetliner on a domestic flight briefly flew almost belly up last month, and vowed to prevent a recurrence.

"We consider it a very serious incident," Ito said. "We will make all-out efforts to prevent a recurrence."