Juneyao Considers Adding Bigger Planes for Overseas Routes

Updated on
  • Chinese carrier hasn’t decided on Airbus or Boeing aircraft
  • Juneyao to join Star Alliance’s Connecting Partner Model

Juneyao Airlines Co., which currently only flies narrow-body jets built by Airbus Group SE, is considering buying 10 wide-body aircraft by 2020 to expand international routes.

The planes could come from Airbus or Boeing Co., Juneyao Chairman Wang Junjin said Monday. The Chinese carrier hasn’t placed any orders, Wang said at a briefing in Shanghai on its plans to join a partnership under the Star Alliance network.

Asian airlines have placed aircraft orders worth tens of billions of dollars as the region is expected to become the world’s leading travel market, driven by economic growth, according to a Boeing prediction. Shanghai-based Juneyao reached a deal Monday to take part in the Star Alliance’s Connecting Partner Model, an arrangement that expands the alliance’s reach through low-cost airlines while increasing the Chinese carrier’s access to destinations outside its home market.

Juneyao is interested in models such as Boeing’s 787 and the A350 from Airbus and will make a decision as early as this year, Wang said. The carrier won’t consider Airbus’s double-decker A380, given its cost and lower fuel efficiency, he said.

Juneyao, which started out as a budget carrier in 2006, has expanded its services beyond low fares to include free baggage allowances. The airline will begin as a Connecting Partner in the second quarter of 2017, Wang said.

Route Connectivity

The Star Alliance, whose biggest members include United Continental Holdings Inc., Deutsche Lufthansa AG and Singapore Airlines Ltd., announced the Connecting Partner Model in December and named South African budget carrier Mango as its first participant. Carriers joining the partnership won’t become a member of the Star Alliance itself. The tie-up allows those traveling on a flight of a Star Alliance member to connect to a route on a partner airline and enjoy the same alliance benefits.

Asian budget airlines are grouping in the face of increased competition after numerous low-cost carriers were established in the past five years as rising incomes and discounted fares lured first-time travelers in the region. Singapore Airlines’ Tigerair and Scoot are part of the Value Alliance announced in May, after four Chinese airlines affiliated with HNA Group formed the U-FLY Alliance in January and subsequently added South Korean budget airline Eastar Jet.

The Asian budget-carrier alliances have so far excluded the region’s biggest low-cost airlines including Malaysia’s AirAsia Bhd., India’s IndiGo and China’s Spring Airlines Co.