OpinionGreen light for foreign budget airlines will harm Hong Kong's interests
Albert Cheng says a green light for Jetstar and others will create unfair competition for our home carriers and infringe the city's air sovereignty
Hong Kong Express Airways, a sister company of Hong Kong Airlines, has announced its first batch of budget flights to seven popular destinations, including cities in Japan, Thailand and Taiwan. Some of its prices were two-thirds cheaper than the usual, lower even than those of other budget airlines in the region.
Hong Kong is undoubtedly the most important aviation hub in the Asia-Pacific region. Tourism, as one of Hong Kong's four major pillar industries, brings in tens of billions of dollars of revenue annually. Aviation, both in passenger demand and on the cargo side, is a highly competitive market. Budget airlines are certainly the way forward for the aviation sector the world over.
According to the International Air Transport Association, this year's net profits for airlines are projected to increase to around US$11.7 billion.
Simply put, this aviation version of the individual visit scheme will taint our aviation industry
Budget airlines have really taken off around the world in the past few years. In Hong Kong, the sector is getting ready for take-off, which is why it has attracted quite a lot of potential investors. Singapore Airlines' low-cost carrier, Scoot, is ready to follow in the footsteps of HK Express and launch budget flights between Hong Kong and Singapore in November.
Consumers, of course, will always welcome low-cost airfares; the cheaper the prices, the better it is for travellers. But there are pros and cons.
Budget airfares do not cover essential charges such as fuel surcharges and baggage charges. Even though some offer free baggage handling, there is a very limited quota. Flight times are often very unfriendly to users, with many in the middle of the night or during non-peak hours. Because the tickets are cheap, there are many restrictions.
I am not against low-cost airlines per se, but to give foreign budget airlines such a free hand to expand their services is somehow putting Hong Kong-based airlines at a disadvantage, creating unfair competition and hurting their business operation.
It will also indirectly affect the livelihoods of hundreds of thousands of workers here, not forgetting other negative by-products, such as environmental pollution and noise pollution.