The Strategy of Asia-Pacific Low Cost Carriers Expansion

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This paper describes how some Low Cost Carriers (LCCs) in the Asia-Pacific region have circumvented the restrictions of air freedoms by way of establishing a new company in another country in order to expand their network service. Faced with stiff competition from successfully established LCCs, some Full Service Carriers (FSCs) also formed fully own subsidiary LCCs and adopted this approach as a foreign expansion strategy. The advantage of investing a new company in another country makes good use of the opportunity of sixth air freedom of the third-party country, optimises fleet utilisation and improves luggage check-in service. The strategy provides a solution for business expansion to those countries without direct flight agreement due to political problems, such as China and Taiwan.
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Low Cost Carriers; Open Skies; Expansion

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