Taiwan’s new airline gets into trouble to launch

Written by Staff Writer at CNN Taiwan’s new local airline has plunked down $107 million in debt to launch its maiden flight this weekend. Delta Air Lines co-owned KLM’s operations in Taiwan will be…

Taiwan's new airline gets into trouble to launch

Written by Staff Writer at CNN

Taiwan’s new local airline has plunked down $107 million in debt to launch its maiden flight this weekend.

Delta Air Lines co-owned KLM’s operations in Taiwan will be rebranded as Sunway Aviation after Taiwanese carrier China Airlines chose not to renew its contract with the Dutch flag carrier as airlinetao’s international passenger operations in Taiwan come to an end this year.

First flights were announced in April but only just marked the start of Sunway’s first passenger business operations since its fleet expansion drive.

A new airline has set sail: Delta’s former Taiwanese partner opens its maiden flight in Taiwan. CNN

The new airline’s maiden flight for the iconic “Hamlet” Boeing 767 was scheduled for Sunday, September 1, the carrier said.

“Our goal is to provide an excellent passenger experience, in order to deliver an excellent work environment for our coworkers,” Sunway CEO Norman Lin said in a statement.

Transition

Taiwan’s new local airline

The airline, which is co-owned by Delta Air Lines and the local government, has plans to grow in a bid to replace China Airlines, but the troubled transition of a former Delta affiliate has created financial hiccups in Taiwan’s tech-driven economy.

The new carrier has taken on $107 million in debt in order to relaunch as its own company, marking the end of a long relationship with Delta Air Lines. CNN

“Competition is very high with China Airlines and China Southern Airlines, so this really brought some uncertainty to the Taiwan market,” Taipei-based travel agent William Huang told CNN.

“Whether the local carrier will be able to attract visitors will depend on the number of flights it launches and their promotion strategies,” he added.

Lin said in May that he expects Sunway to carry up to 1.5 million passengers a year by 2023.

The cost of adjusting

The carrier had previously raised concerns among investors over its ability to navigate the financial challenges inherent in transferring to a new company without any money to pay back lenders.

But authorities moved ahead to purchase the rights to operate a new generation of aircraft — which could ultimately increase passenger numbers — while investors helped pay for the transaction.

“We believe that the capital expenditure for the new fleet alone will be less than 50 million,” Lin said.

Emirates, Air France-KLM, Qantas and other international airlines join forces with the new Taiwanese carrier.

The airline has come under fire, including from critics of the political shift in Taiwan, for opening its first flight just weeks before a leadership transition on the island.

But Lin rejected any questions of politics as a motive behind the launch, saying it was purely a commercial decision.

Sunway has been trying to convince investors the new company will help fuel passenger growth in Taiwan.

Leave a Comment