Low-Cost Airlines' '0 Won' Special Offer Event
Travelers Decrease as Off-Season Begins
Competition among low-cost carriers (LCCs) for discounted airfares is intensifying. As the second quarter, typically considered the off-season in the airline industry, begins and the number of overseas travelers shows a declining trend, it is interpreted that airlines have adopted this strategy to increase market share. Some airlines have launched promotional events one after another, including offering '0-won air tickets' with no airfare charged, to attract passengers.
According to the Ministry of Land, Infrastructure and Transport, the number of flights to Japan and Southeast Asia operated by the three major domestic LCCs?Jeju Air, Jin Air, and T'way Air?increased from 1,998 flights in December last year to 2,334 flights in March this year.
While the number of flights has increased, the number of outbound overseas travelers has recently declined. The number of overseas travelers rose from 1.39 million in December last year to 1.78 million in January this year, then decreased to 1.72 million in February and 1.47 million in March. This appears to be related to seasonal factors. Typically, the peak seasons for airlines are summer and winter, coinciding with vacation periods and school breaks.
Domestic airlines are strengthening promotions considering that the second quarter is the off-season for overseas travel. Air Seoul, which introduced '0-won air tickets,' is a representative example. On the 18th of last month, Air Seoul ran a 'Fare-Free Special Promotion' on all international routes. The '0-won air ticket' means the airfare is zero won, and only fuel surcharges and airport facility usage fees need to be paid. This applies to flights departing between April 19 and July 20 on routes such as ▲Incheon~Tokyo (Narita) ▲Incheon~Osaka (Kansai) ▲Incheon~Da Nang.
Additionally, Jin Air is running a promotion until the 29th to commemorate the resumption of the Incheon~Macau route, offering benefits such as airfare discounts and hotel partnerships. Jin Air is providing a 50% discount on airfare to customers who book round-trip tickets for two or more people on a first-come, first-served basis.
On the 3rd, tourists are arriving at Incheon International Airport Terminal 1. Photo by Kang Jin-hyung aymsdream@
Meanwhile, the LCC industry is currently focusing on securing traffic rights to Indonesia. With supply on medium- and short-haul routes such as Japan already saturated, they see the new medium- and long-haul route to Indonesia as an opportunity to diversify their revenue structure.
Indonesia is traditionally a major tourist destination that continuously attracts visitors. Before COVID-19, the number of passengers on domestic flights to Indonesia slightly decreased from 822,009 in 2017 to 810,197 in 2018, but surged to 890,876 in 2019.
Furthermore, the LCC industry expects demand to expand in Indonesia from a business perspective as well. Domestic mobility and secondary battery companies are entering the local market, which means Indonesia could bring many passengers and cargo to the airline industry in terms of business demand. Accordingly, Jeju Air will operate charter flights once round-trip on the Incheon~Manado route starting on the 18th and on the Incheon~Batam route starting on the 19th. Manado and Batam are representative tourist destinations in Indonesia.
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