TransAsia Airways wants to break out of Taiwan's shrinking domestic market by establishing joint venture airlines overseas starting with China and South Korea.
The Taiwanese carrier says it plans to establish an airline in Shanghai in a joint venture partnership with Sichuan Airlines and have it start operations as early as 2008's second quarter.
This new carrier will have at least 300 million yuan ($40 million) in capital and TransAsia is expected to have a 25% stake, it says, adding that another Taiwanese investor or investors will have 24% and Sichuan Airlines will have the majority stake.
The carrier also says it plans to establish a joint venture passenger airline in South Korea's second major city, Busan.
Several news reports in South Korea say the carrier will be called Busan Airlines and will launch in 2009, starting with domestic services and then adding international routes such as Busan-Taipei.
The reports say TransAsia has the support of the Busan Chamber of Commerce and Industry and the Busan government. Its partners are reported to be Lotte Hotel Busan, Busan Bank, Seun Steel, South Korean apartment building developer Dongwon Development, South Korean value-added steel products and bathroom supplier BN Group, Win Steel and South Korean tyre manufacturer Nexen.
TransAsia says the move into China and South Korea is an effort to expand its business and be less reliant on the Taiwan domestic market.
It, like many carriers in Taiwan, has had to scale back its operations due to increased competition from the high-speed train that runs from Taipei in the north of the island to Kaohsiung in the far south.
Source: Flight International
