Low-cost long-haul formula is a hit for Oasis

Oasis Hong Kong Airlines is almost a year old – and its affordable business class formula has been a resounding success for the company’s founders. Now the company is targeting rapid growth, as Liz Moscrop discovers

On October 26, Oasis Hong Kong Airlines celebrates its first birthday. It has been a remarkable headline-hogging year for the low cost long haul carrier. The airline is the brainchild of the company’s chairman, Reverend Raymond C Lee and his wife Priscilla H Lee, Oasis’ executive director. The couple put together a strong management team, headed up by CEO Steve Miller, founder and first CEO of another Hong Kong-based airline, Dragonair. Other members of the team have come from executive positions in airlines.

The airline has also worked hard on recruiting crew who work well together, believing the right pilots and cabin staff will help create a happy working environment, which is crucial to its success. Pilots are all highly experienced and currently are predominantly based in the UK, while cabin crew live in Hong Kong. Mrs Lee says: “I want our team to wake up in the morning and be happy to go to work.”

It has been an eventful first year for the airline. The inaugural flight took off from Hong Kong after a 24-hour delay, caused by Russia revoking the London-bound flight’s fly-over rights at 12:09pm, one hour before its scheduled departure. In June Oasis announced a new Vancouver route and all summer the airline has performed impressive low-speed displays of its 747-400 aircraft at air shows around the UK.

The concept is simple. Aircraft are heavily business class oriented with fares starting at HK$1,000 ($128) for at least 10% of the one-way economy seats available between Hong Kong and London. The idea has caught on. The price includes two hot meals and in-flight entertainment, and tickets are booked through the company website and travel agents. Business class fares start at HK$6,600 ($846). One-way economy fares for Vancouver start at $243 with round trip business class fares coming in from around $2,300.

Oasis owns and operates five 747-400s, two of which have come from Singapore Airlines and three from All Nippon Airlines (ANA) of Japan, although only one of the new acquisitions is in service. Though Oasis offers substantially lower fares than other carriers flying the same routes, it provides a similar level of passenger space, with economy pitch coming in at 32in, and a business section of at least 50in. The 747-400 cabins are configured for 81 business and 278 economy passengers for ex-Singapore aircraft or 71 business and 268 economy passengers for ex-ANA aircraft.

Last month the company announced the numbers of flights between Hong Kong to Gatwick will be increased from seven to ten flights per week starting in December. The extra three weekly flights will likely be operated with one of the additional ex-ANA 747s. Oasis has timed this new departure from Hong Kong during the day, in response to passenger demand.

Commercial director Ken Chad says: “The take up from Hong Kong has been huge. We have seen load factors in the 90s. We’re obviously selling through the travel agent community and directly through our website. However, the prices are the same - we don’t undercut travel agents. They are an instrumental part of our business model as we fly long haul. Our on-time performance since the massive delay on our first day has been fantastic. This is a very good barometer.”

Steve Miller agrees: “From the outset, we were confident Oasis would be popular with Hong Kong and London travellers, but we have been very encouraged by the high demand. We are thrilled with this success.”

Oasis broke even after just five months. The airline attributes this to lower maintenance and fuel costs created by flying long haul. It also has a lower cost per passenger-kilometre compared to other airlines. Its target passengers are business travellers and those who used to have to transfer en-route to get to London. Oasis plans to hedge a proportion of its fuel purchases to guard against future fuel price increases.

Source: Flight Daily News