July 08, 2013
Singapore, Bangkok and Hong Kong have traditionally been Asia's most prominent hubs, and now Taipei is striving to compete more fiercely, although making inroads will be tough.
“Taiwan's geographic location is such that it has the shortest distance to all major cities in the Asia-Pacific region, making Taiwan's Taoyuan International Airport an important hub in the region,” said the Star Alliance last month in announcing the new membership of Taiwan's EVA Air.
The island's geographic advantage must be part of a sensible strategy, however. Having the shortest distance to all major cities in the region is useful to businesses in Taiwan, but it does not necessarily benefit business travelers from outside the region who need a place to transit.
Lufthansa CEO Christoph Franz says it is understandable that Taiwan is promoting itself as an Asia-Pacific air hub, but he notes that “Taiwan is quite far west, so it is not ideally located for people coming from Europe. Singapore's advantage is that it is close to Indonesia and Australia. Hong Kong is also better located than Taiwan.”
A lot of traffic from Taiwan passes through Hong Kong, which makes Cathay Pacific Airways a formidable competitor for Taiwanese carriers. Samuel Lin, president of Taipei Taoyuan International Airport Corp., says Cathay is the third-largest airline at the airport.
Despite the recent inclusion of EVA Air, only seven of Star's 28 members operate to Taipei: Air China, Shenzhen Airlines, All Nippon Airways, United Airlines, Asiana Airlines, Thai Airways International and Singapore Airlines (SIA). Instead, Star carriers tend to connect with EVA in Hong Kong and Bangkok. Many of EVA's flights to Europe are routed via Bangkok for historical reasons—political relations between China and Taiwan only started to improve in 2008 when Taiwan's new Kuomintang Party government came to power. The Kuomintang government adheres to the “One China” policy. Prior to that, Taiwanese carriers were barred from Chinese airspace, making it necessary to reach destinations west of Taipei by flying over Thailand.
Lin says TransAsia has virtually no transit traffic through Taoyuan Airport but that of China Airlines and EVA Air averages 27% each. The airport's overall transit-traffic average is 10%, which the airport is keen to increase. One bonus in this area is the transit traffic it receives from Singapore-based Jetstar Asia and Scoot, which use fifth-freedom rights to transit through Taipei to destinations in Japan.