TransAsia expecting profits next year after corporate restructuring

Taiwanese carrier TransAsia Airways said Wednesday that it is expecting profits starting 2017 after a recent company restructuring, including suspending operation of a subsidiary carrier and seeing reduced insurance payments thanks to increasing safety performance.

After the suspension of V Air, which ended services Oct. 1, TransAsia could avoid losses of up to NT$50 million (US$1.59 million) per month, said TransAsia Chairman Lin Ming-sheng (???).

According to Lin, the airline has also begun to step out of the shadow of two fatal crashes July 23, 2014 and Feb. 4, 2015, which took 91 lives.

TransAsia Airways' insurance company, which TransAsia declined to disclose, has decided to cut its insurance premiums by 73 percent, reaching nearly the level before the accidents and saving the company NT$200 million each year.

Accidents usually lead to a 10 percent-30 percent hike in insurance payments, the airline said, but declined to unveil the exact amount of insurance increase after the crashes.

The cut for future insurance was a result of both on-site examinations from the insurance company and a briefing by Lin himself about the carrier's flight safety standards.

To assure the insurance company about TransAsia's safety performance, the airline said, it presented its record of no violations in flight operation over the past year under the Civil Aeronautics Administration's supervision.

"We are pumped up by the cut in insurance because it means that our flight safety is recognized," Lin said in giving the airline's market prospects at a press conference.

With less financial burden, TransAsia will explore new markets more aggressively, Lin said.

The company will rejuvenate business by launching direct flights to both Sendai in northeastern Japan and Chiang Mai in Thailand, he said.

The Taoyuan-Sendai flights will operate on Mondays and Thursdays, while Taoyuan-Chiang Mai flights will fly every five days, the company said.

In December, TransAsia will launch three new routes, to Fukuoka in Japan, Busan in South Korea and Bangkok in Thailand, he said.

Source: Focus Taiwan News Channel