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Small airlines thrive amid fierce competition

07-29-2010 14:06 BJT

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Airline giant Singapore Airlines is facing formidable competition from much-smaller carriers. Despite their reputation for safety and service, big airlines are losing market share to a low-cost, no-frills approach. Yin Hang takes a look at how budget airlines are not only surviving, but thriving amidst fierce competition and a difficult economic climate.

Jetstar Asia Airways was established in 2004. Making its name in providing low cost, short distance fares, Jetstar started to rake in profits as soon as it was launched.

The company currently owns ten A320 carriers, linking more than 20 cities around Asia.

But many passengers are curious about how security can be guaranteed when costs are squeezed to the lowest level.

Chong Phit Lian, CEO of Jetstar Asia Airways said "We are under the same aviation security requirements set by the Singapore government. So our clients know that we provide secure services, same as the large airlines."

For budget airlines such as Jetstar, management costs remain just as high as those of larger airlines. But airfares are maintained at half the normal price.

So what are the secrets of Jetstar's success?

The formula is quite simple: more flights, more destinations, and less costs for each flight.

Chong Phit Lian said "Because we're a small air company, we have more flexibility when running our business. We can easily provide services catering to the needs of our clients. Our service has become more popular during the economic downturn."

Jetstar made it through the financial crisis, and succeeded by responding promptly to the market fluctuations and the demands of consumers.

Experts say small businesses in China have many lessons to be learned from Jetstar, on ways to stay successful amidst fierce competition and uncertain economic times.

Editor:Xiong Qu |Source: CNTV.CN

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