This Taiwan Airline Flew For 62 Years, But May Be Grounded Indefinitely

Far Eastern Air Transport, a six-decades-old Taiwanese airline catering to destinations within Asia, suddenly suspended its flights on December 12. The airline’s website said that as of December 13 it would cease to continue running because of unspecified “operational losses.”

On Friday, Chang Kang-wei, Far Eastern’s chairman, told a news conference that he had found new sources of investment and hoped to restart flights as soon as possible, although analysts expect more turbulence.

“Airlines such as Far Eastern are stuck in the strategic position that is unsustainable,” says John Grant, director of JG Aviation Consultants in the United Kingdom. “Neither a low-cost carrier nor a full service network airline, the carrier is challenged from all sides and unable to command a secure market position.”

The airline was founded in 1957 with domestic routes around Taiwan, where flights average just 30 minutes. But in 2008 it declared bankruptcy and flights stopped through early 2011. In 2007, Taiwan had launched a high-speed railway that reduced the demand for domestic flights.

Far Eastern Air Transport has struggled too because it relies heavily on McDonnell Douglas MD-82 and MD-83 aircraft, while other airlines, including the budget carriers, are buying newer planes made by Airbus and Boeing. Its fleet has a total of six aging MD-80 family aircraft and six ATR 72 turboprops.

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Far Eastern Air Transport struggles too for lack of code sharing and membership in airline alliances, says Jeffrey Lowe, managing director of the Hong Kong aviation services firm Asian Sky Group. Its base at the smallish Taipei’s Songshan airport further constrained business because civil aviation authorities allow flights only to a couple dozen cities outside Taiwan, mostly in China. That base made it hard to set up connecting flights, Lowe says.

“FAT has a long history but has always struggled to survive,” Lowe says. “It has been in a financial crisis of one form or another since 2008, the last 12 years.”

Neither a budget carrier nor a full-service airline

Far Eastern Air Transport fails to fit into either of the two most viable types of airlines around Asia today, Grant says. The airline has just a 10% share of capacity for all Taiwanese airlines, he says. Four other Taiwanese carriers fly international routes and another, the ultra-high-end StarLux Airlines, will open three routes in January.

The two dominant international carriers Eva Airways and China Airlines have newer aircraft fitted with entertainment systems, while Eva focuses intently on cabin cleanliness. Budget carriers based offshore serve throngs of young, thrifty Taiwanese tourists bound for Japan, South Korea and parts of Southeast Asia. Budget travel is so popular in Southeast Asia that Kuala Lumpur and Singapore have opened budget-only terminals.

Occasionally airlines that are neither high nor low end survive because they have a “geographic niche,” Grant says. Far Eastern does not, he says.

The halt to flights on Friday affected 3,251 outbound group tourists, Taiwan’s tourism bureau says in a statement Thursday.

The airline would not say for this post how much capital its CEO had garnered but that the airline is ready to fly again if given regulatory approval. “We can’t say anything about the next few years,” an airline spokesperson said for this post. “We’re just waiting for the official approval to fly again.”

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As a news reporter I have covered some of everything since 1988, from my alma mater U.C. Berkeley to the Great Hall of the People in Beijing where I followed Communist officials for the Japanese news agency Kyodo. Stationed in Taipei since 2006, I track Taiwanese companies and local economic trends that resonate offshore. At Reuters through 2010, I looked intensely at the island’s awkward relations with China. More recently, I’ve studied high-tech trends in greater China and expanded my overall news coverage to surrounding Asia.

Source: This Taiwan Airline Flew For 62 Years, But May Be Grounded Indefinitely

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Taiwan’s Far Eastern Air Transport (FAT) has just announced it will cease all operations. This video covers the details regarding the ceasing of flights and a brief background of Far Eastern Air Transport. ✈ Ishrion Aviation is an Aviation Channel bringing you premium trip reports/reviews and the latest aviation news and developments to your fingertips. ▶️ If you enjoyed this video, make sure to subscribe for the latest aviation news and developments! https://www.youtube.com/c/IshrionAvia… 👍 Make sure to leave a like! Leave a comment down below! ‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒ SOCIAL MEDIA 📸 Follow Me On Instagram For Aviation Media & Pictures: https://www.instagram.com/ishrion.avi… (@ishrion.aviation) 🐤 Follow Me On Twitter: https://twitter.com/IshrionA (@IshrionA) ‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒ ✈ Support Me On Patreon: https://www.patreon.com/IshrionAviation ‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒ About Me: Welcome! This is the Ishrion Aviation YouTube Channel featuring premium trip reports, the latest aviation news, and other aviation content! Make sure to subscribe if this is something you’re interested in! ‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒‒ Music: Keys of Moon – Morning Lights https://www.youtube.com/channel/UCWtF… Video footage/images by Far Eastern Air Transport. MD-80 image by Jeffhuang0627: https://commons.wikimedia.org/wiki/Fi… Sources: https://www.ch-aviation.com/portal/ne… https://finance.technews.tw/2019/12/1… “Far Eastern Air Transport (FAT) suspended sales of tickets on December 12 and subsequently announced that it will cease all operations from December 13 onwards. The carrier said via its website that it had “difficulties raising funds due to long-term operating losses”. Initially, the airline said that ticket sales were only suspended due to “systems’ maintenance”. The airline reportedly suffered financially due to the poor reliability and high operating costs of its McDonnell Douglas (Long Beach) twinjets. According to the ch-aviation fleets advanced module, the airline operates six ATR 72-600s, four MD-82s, and three MD-83s (of which two have been inactive since mid-September and early November 2019). The MD-82s are 25.4 years old on average and the MD-83s – 23.4 years. The airline expected to start taking deliveries of eleven B737-8s from lessors in November 2019 but this was delayed due to the type’s grounding.” “Far East Airlines reported today that it will be closed. The Civil Aviation Bureau of the Ministry of Communications has not confirmed that it only said that a press conference will be held in the afternoon. The Ministry of Labor stated that it had contacted the Taipei Municipal Bureau of Labor, which has not received a large number of dismissal plans.” Translate: 遠東航空今天傳出將停業,交通部民航局未證實,只表示下午將開記者會。勞動部則表示,與台北市勞動局聯繫,勞動局目前未收到大量解僱計畫書。 遠東航空今天傳出將停業消息,交通部民航局並未證實,只回應下午將在民航局召開記者會,等時間確定後會通知。 遠航傳出停業消息,員工去留也受關注,勞動部則表示,與台北市勞動局聯繫,勞動局目前未收到大量解僱計畫書。 根據大量解僱勞工保護法規定,事業單位大量解僱勞工時,應於 60 日前將解僱計畫書通知主管機關及相關單位或人員. #FarEasternAirTransport #FATAirlines #AirlineBankruptcy
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