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Interviews with foreign-affiliated companies in Kansai (Juneyao Airlines)

Last update:October 28,2014

【China】Juneyao Airlines CO.,Ltd.

Founded: April 2014
Address: 20th floor, 2-3-13 Azuchi-cho , Chuo-ku, Osaka, 541-0052
Line of business: Passenger Transport Business
Website: Juneyao AirlinesExternal Site Link (opens in new window)

Interview

Juneyao Airlines CO., Ltd. is a private airline that started its business in September 2006.  With Shanghai as its home airport, the airline operates more than fifty domestic flights in China and also international flights to destinations in Asia, such as Hong Kong, Thailand, South Korea, etc.  The airline started its operation in Japan with its flight to and from Okinawa.  Then, in April 2014, when the company started operating a flight between Kansai and Shanghai, it decided to set up its first Japanese base in Osaka.  We interviewed Manager of Japanese Branch Mr. Dong.

100% Privately Owned Chinese Airline Operating as Full Service Carrier

Our company is a private airline, which is quite unique in the Chinese airline industry, where the vast majority of the airlines are owned by the state. In addition, we are not a low cost carrier (LCC), but a full service carrier. We place great importance on service and quality by offering our customers wide aisles, comfortable seats, luxurious meals and so on.
One of our strengths as a private company is mobility. We can swiftly take action that reflects our marketing messages on our service. We have six members of staff in our Osaka office and we also offer a call center service from the office. Customers can access this service not only from Japan, but also from China, for example, while they are travelling in the country on a business trip. Moreover, customers can always call our call center at the Japanese domestic call rate.
All of our staff are full of motivation, drive and ideas. Each member of staff can handle two or three jobs simultaneously, which are normally handled separately by two or three employees in a typical state company. As a result, we are achieving high operational efficiency and realizing cost reductions. However, as an airline company, safety is our top priority, so we are putting a lot of effort into safety, for example, by employing highly experienced and capable pilots.
Our company currently leases thirty-six aircrafts, most of which are the Airbus A320, and all of them are newly-built aircrafts. To tell the truth, in terms of the operating cost of aircrafts, lease expenses account for a large part of costs, as well as personnel costs. Fortunately, as our group company, the JuneYao Group (which is one of zaibatsu-type conglomerates in China) acquired a bank alliance and started running the first ever private bank in China, we have become able to procure a large sum of funds from the Group. Consequently, of the ten to twelve aircrafts we are planning to add in the near future, we will be able to own six or seven of those aircrafts as a company asset. As a result, we will be able to reduce our leasing expenses and curb our aircraft-related costs to a great extent.
Our company is an airline that can efficiently provide services that can always satisfy our customers.

Our Journey to Kansai Airport

When we entered the Japanese market, we received considerable support from
JETRO offices in Shanghai and various cities in Japan.
From the start, we regarded Japan as a very important market for us, and we looked into every major airport throughout Japan to decide our first flight route to Japan. After extensive deliberations, an opportunity arose for us when the multiple entry tourist visa system for Chinese people (Chinese tourists can leave and enter China as many times as they want until the visa expires) was introduced. We decided on Okinawa Naha Airport as our first airport to start our new service. As Okinawa’s main industry is tourism, we received tremendous support from both the government and the private sector when they invited us to their prefecture and also when we were preparing to launch our service at Naha Airport. Thanks to their support, we were able to make smooth preparations and reach a point where we were ready to start our service from September 2012. However, just before launching our service, the dispute over the Senkaku Islands occurred, and from that point onwards, our business was completely stalled for more than a year. Profits matter for private companies, so if they cannot operate their business, normally they pull out of the market. However, we saw great potential in the Japanese market awaiting us, and we patiently waited until the time was right, while continuing to pay our office rent and salaries to our staff.

Finally to Kansai Airport

After establishing our foothold in Okinawa, we started to consider expanding our business into other Japanese airports popular among Chinese people, namely, Haneda Airport, Kansai Airport, and Hokkaido New Chitose Airport.
As Kansai Airport is a large airport with some arrival/departure slots still available, we were delighted to successfully launch our service at the airport. While we were trying to set up our base in Osaka, the JETRO Osaka Head Office kindly gave us various pieces of advice and provided us with generous support, by letting us use their temporary office, for example.
Haneda Airport didn’t have any available arrival/departure slots at that time. We hope that Haneda Airport will be expanded in preparation for the 2020 Tokyo Olympics. With respect to New Chitose Airport, which is adjacent to the base of the Japanese Air Self-Defense Force, we had to give up launching our service at the airport in the end, because we had to vary our arrival and departure times depending on the day of the week, in order to coordinate with military aircrafts, which would cause inconvenience for our customers.

Attractions of Kansai

I came to Japan twenty years ago to study Japanese at a Japanese language school in Osaka, and then after that, I studied at university in Kobe. My image of Osaka is a city of commerce with a number of small and medium-sized companies where things are handled quickly. I think Osaka offers us a lot of business opportunities and will continue to grow globally. I hope that managers and business persons from those companies in the Kansai area that have close relationships with China will use the services of our company more and more.
Currently, tourists from China account for the majority of our customers, and current sales are mainly taking place in Shanghai. Osaka offers a variety of delicious food as well, so many Chinese people visit Osaka to look for high-quality electronic appliances, cosmetic products and so on. As tourist destinations, there are Kyoto and Nara around Osaka, and there is also Koyasan in Wakayama prefecture, which I like very much.
As the Japanese driving license system is stringent, it is difficult for Chinese tourists to drive around using a rental car in Japan, so they need to rely on buses and trains when they go sightseeing from the airport. Hence, we would like to closely collaborate with train companies, so as to inform Chinese tourists of the many attractive sightseeing plans. By doing so, we would like to invite more and more Chinese customers to the Kansai area.
Okinawa has been promoting a tourism event in Shanghai. We hope that the Kansai region, including Osaka, Kyoto and Nara, will put a more concerted effort to invite Chinese tourists into their region. We look forward to discovering more attractions of the Kansai region in the near future.

Future Prospect

As the Airbus A320 aircrafts, which our company owns at the moment, are medium-range aircrafts whose maximum flight time is five to six hours, we currently fly from Shanghai only as far as destinations in South East Asia, such as Singapore. However, we are currently planning to introduce Airbus A330 aircrafts in the near future, which can fly for up to ten to twelve hours, and are considering starting services to Australia and European countries. Then, we will be able to take our customers to anywhere around the world with connecting flights at Shanghai.
As far as Japanese domestic flights are concerned, we will start operating our flights at Chubu International Airport from February 2015. Although we have acquired a license for Fukuoka Airport in Kyusyu, which has many tourist spots, , it may take some time for us to start our service at the airport. Above all, most importantly, in preparation for the 2020 Tokyo Olympics, we would like to concentrate our utmost efforts to start our service at the Haneda Airport, and we want to establish a golden route between Kansai and Tokyo. When it comes to Kansai Airport, we plan to start offering morning flights in addition to the night flights that we are currently operating, in order to improve convenience for business people making a one-day business trip.
As we have decided to set up our base in Osaka, we have become a member of the Osaka Chamber of Commerce and Industry, as a local company. We are willing to make a social contribution, for example, by accepting interns from the Osaka University of Tourism and will try to adapt to Japanese practices and customs as much as possible.
In the future, we will establish another office in Japan, either in Tokyo or in Nagoya, where we are aiming to start our service in coming years. We would like to firmly establish ourselves in Japan with two bases in the country, one in Osaka and another in Tokyo or Nagoya.

Contact Information

Ministry of Economy, Trade and Industry, Kansai Bureau
International Investment Promotion Division
Address: 1-5-44 Otemae, Chuo-ku, Osaka, 540-8535
Phone:+81-6-6966-6033
E-Mail:invest-japan-kansai@meti.go.jpMail (mail client will launch)