Spring Air Plans Japan Low-Cost Carrier Next Year to Tap Demand

Spring Airlines Co., China’s biggest non-government controlled carrier, applied to offer domestic services from Tokyo’s Narita airport to serve growing demand for low-cost flights in Asia’s second-biggest economy.

Spring Airlines Japan Co. plans to fly Boeing Co. 737 aircraft on three routes in Japan starting in May 2014, the company said today in a statement. Shanghai-based Spring Air will own 33 percent of the venture with Japanese investors holding the remainder.

Spring operates flights from China to Japan’s Ibaraki prefecture, northeast of Tokyo, and intends to add to low-cost carrier competition in Japan, where three budget carriers started services last year. Spring would be competing with ANA Holdings Inc. (9202)’s Vanilla Air, which starts operations before the end of this year at Narita after the Japanese legacy carrier bought out AirAsia (AIRA) Bhd.’s share of a low-cost carrier venture.

“We will work to cut unnecessary costs to offer low fares,” Hiroshi Ugai, president of Spring Japan, told reporters in Tokyo today. He declined to say how much tickets would cost.

AirAsia, the region’s biggest discount carrier, announced in June that it was exiting the ANA partnership amid disputes over operating the company.

ANA also holds a 39 percent stake in budget airline Peach Aviation, which began operations last year.

To contact the reporters on this story: Chris Cooper in Tokyo at ccooper1@bloomberg.net; Kiyotaka Matsuda in Tokyo at kmatsuda@bloomberg.net.

To contact the editor responsible for this story: Anand Krishnamoorthy at anandk@bloomberg.net

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