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Business Insight

Luxury on the Cheap

Takuma Yoshioka

Airline managers are always looking for new ways to lure Hong Kong's legion of frequent travelers. Now some are offering a business class option that offers more space than economy at a competitive price in a bid to attract middle-class flyers.

Many of those flyers are travelling to Japan not on business, but due to interest in the country. At a recent trade show in Hong Kong, visitors were keen to try craft Japanese sake from little-known regions. Merchants say more people in Hong Kong are developing a taste for regional specialties from Japan. Sake buyer Alan Lau says "now, more and more people are looking for smaller breweries, in the rural areas, near the farm areas, far from the city."

The interest has carried over to a desire to visit the production areas, and airlines are scrambling to open new routes between Hong Kong and Japan's regional airports. They've already established direct links to Hiroshima and Miyazaki and plan to open a route to Kumamoto in mid-December. Tour operators are organizing chartered flights to other remote destinations, such as Tottori.

Many tourists are interested in the area because it spawned a popular manga series featuring monsters from Japanese folklore. A proposed tour package would include train rides and visits to secluded hot springs. One frequent traveler says "I've been to Tokyo, Hokkaido, and Kyoto. I like the monster characters we enjoyed when growing up."

Airline operators are also upgrading services on their flights. Managers at a Hong Kong-based airline have drawn in customers with their new affordable business class, with seats that are 50% to 60% cheaper than a typical business class seat at a rival airline. The cabins were redesigned to fit as many seats as possible and a long list of in-flight videos was added. One airline only uses one model of plane in its fleet to cut the cost of training for pilots and maintenance.

Many middle-class Hong Kong residents say economy seats are too cramped, but consider business seats too expensive. They say the compromise is just right. Michael Burke of Hong Kong Airlines says "we've seen business class sales improve almost 40% year on year, for the 1st half of this year. And our Japan routes, in particular, have been very strong."

Flyers are enjoying a range of new options, which are breathing fresh air into Hong Kong's aviation market.

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