Paper for the 14th ATRS World Conference in Porto, Portugal, 6-9 July 2010 Main factors that hamper LCCs development in Japan

摘要

Today, Low Cost Carriers (LCCs) have already become major players in the airlineindustry in the U.S., Europe and Eastern Asia and provide consumer benefits. On theother hand; however, there has never been a low cost carrier in Japan in a true sense.After the deregulation, five airlines have entered the market but none of them becomean LCC though they tried. This paper aims to identify the main factors that hamper thedevelopment of LCCs in Japan. To this end, Skymark airlines, closest to the traditionalLCC business model, is chosen as a case study. Interviews with CFO of Skymark aswell as government officials were undertaken. Comparison in terms of costs per RPK(revenue passenger kilometer) and ASK (available seat kilometer) among Skymark,Southwest and easyJet was made. Finally, four main factors that would hamper LCC’sdevelopment in Japan are identified and policy directions to address them are suggested.