Far Eastern Air Transport Shuts Down Amid Starlux’s Launch

Advertisement:

Far Eastern Air Transport has become the latest airline to fail into bankruptcy in 2019, letting all staff go and canceling all flights. The domestic airline had high hopes for its future, which now belongs to other Taiwanese airlines like startup Starlux.

Far Eastern Air Transport MD-82 at Taipei Songshan Airport. Photo: Theodoranian at Chinese Wikipedia.

Who was Far Eastern Air Transport?

Far Eastern Air Transport, or FAT for short, was a domestic carrier based in Taiwan, specifically out of Taipei Songshan Airport.

The airline was founded back in 1957 as a charter carrier but would go on to introduce normal air services in 1963. These services were very popular for the next thirty years across the island. Its international routes reached as far as Cambodia, South Korea, Japan, and the Philippines and its cargo routes were quite lucrative.

It was doing so well that it decided to invest in Angkor Airways in 2004, looking to expand that airline across the region in the beginnings of its own hub network.

At its peak, the airline operated multiple Boeing 737s and 757s.

A FAT Boeing 757. Photo: Michel Teiten via Wikimedia

However, things start to change around 2006 and 2007 with the downturn of the US market and the rise in fuel prices around the world. Internationally, FAT had to scrap its losses with Angkor Airways to face its own domestic issues.

Advertisement:

The airline was also greatly affected by the introduction of high-speed rail in the country, which could provide a somewhat more convenient service than passengers traveling from airport to airport on these short routes.

Lastly, the airline made some risky investments throughout the period that resulted in it failing to pay back a loan to IATA and losing its IATA license in 2008.

What about today’s bankruptcy?

The airline has been on its last legs for many years now, failing and re-earning back its licenses since 2011.

Advertisement:

Things were starting to look up as strong domestic demand spurred more international travel. The airline invested in a vast fleet renewal, ordering 11 of the Boeing 737 MAX.

The grounding and subsequent failure to deliver these new aircraft to the airline resulted in the need to use older aircraft for longer than planned. It had decided to lease two more Boeing 737-800 aircraft in the meantime, but got into a legal dispute over the condition of the aircraft.

These earlier failures, unlucky choices and movement of the market were the final nails in the coffin for the carrier, which stopped ticket sales and released all staff earlier this week.

Because of how sudden the termination of the airline was (and that 1,000 employees were not given notice) the CEO has had their passport denied. Investigators will go over the financials of the company with a fine-tooth comb, as reported by Taiwan News.

Starlux takes flight

At the same time, Taiwan has a new rising airline taking to the skies. Starlux has gone from strength to strength with its new international long-haul services soon to begin.

New airline Starlux oozes luxury and sophistication. Photo: Starlux

Starlux seems to be doing everything the opposite of FAT, focusing on long-haul international routes (not trying to beat the train), focusing on high-end travelers (and thus not competing on ticket price) and using modern aircraft like the Airbus A350 and A321neo.

Some have even dubbed it the Emirates of Asia.

We feel for the staff that have lost their jobs and for the end of a legacy airline. We hope that they can find employment with another airline (perhaps Starlux if they keep expanding).

What do you think of this news? Let us know in the comments.

Advertisement: