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Scoot's strategy dovetails with New Southbound policy: CCO

2017/12/04 16:53:09

Scoot CCO Vinod Kannan

Taipei, Dec. 4 (CNA) Singapore-based budget airline Scoot, which has operated in Taiwan for five years, is optimistic about prospects in the local market because its development strategy suits Taiwan's New Southbound policy, a company executive said recently.

"Taiwan is like a mini-hub for us," according to Vinod Kannan, Scoot's chief commercial officer, in a conversation with CNA last week. "So the Southbound policy is exactly in line with what we are doing."

The policy, launched in mid-2016 to reduce Taiwan's dependence on China, seeks to increase Taiwan's cooperation with Southeast Asian and South Asian countries, as well as New Zealand and Australia.

The low-cost carrier is also eyeing further expansion of its network in Southeast Asia, especially after a merger in July with Tigerair Singapore that gave Scoot more than 10 new destinations in Indonesia, Malaysia and the Philippines, Kannan said.

As more business and travel exchanges emerge in the region, the extended network will enable Scoot to offer more economical fares, Kannan said.

Scoot currently offers nonstop service to Northeast Asia between Taipei and Seoul, Tokyo and Sapporo and between Kaohsiung and Osaka and to Southeast Asia between Taipei and Kaohsiung and Singapore.

Kannan acknowledged getting Taiwanese passengers to use Scoot for other Southeast Asian destinations could be a challenge because of the extra time needed to transit through Singapore.

But he said the network is ideal for travelers who might make multiple stops and mix business with tourism in their itineraries.

"It's not perfect, but I think the list of destinations and the network we have is probably the best," Kannan said.

To further solidify its position in the Taiwan market, he said, Scoot will add one more weekly flight on both the Taipei-Sapporo and Kaohsiung-Osaka routes to provide four round-trip flights per week starting in the first quarter of 2018.

In addition, Kannan said his company is leading a transformation in the low-cost carrier business model by flying medium to long-haul routes, and that has attracted the attention of Taiwanese passengers.

After launching flights from Singapore to Athens in June, Scoot will operate flights from Singapore to Honolulu this month and to Berlin in the second half of 2018.

The flights to Athens, which have had a load factor of 80 percent, transported some 2,000 Taiwanese passengers this summer, Kannan said.

The load factor on Scoot's existing flights serving Taiwan is around 80 percent, Kannan said, and the goal is to raise that level to 85 percent in the near future, which is the airline's system-wide average.

According to the carrier, it carried more than half a million Taiwanese passengers in the 12 months ending September 2017, a year-on-year increase of nearly 20 percent.

(By Lee Hsin-Yin)