How a world-class airline missed the bus

Amidst the Coronavirus crisis, when huge airlines like Lufthansa are struggling and others are already close to bankruptcy. Airline and airport rankings are reshuffling.

The local competition for Eva Air are weak; Cathay Pacific whose survival is also in question is struggling. At least with Hong Kong’s identity destroyed by the Chinese Communists, it has lost its former shine.

China Airlines suffers from association with Taiwan’s neighbor and is often confused with Air China. Thai and Singapore Airlines operate from expensive and touristy hubs.

As of the time of this writing, the only hub carriers active are Turkish and Emirates, both Islamic and with ridiculous transit times in Dubai and Istanbul.

Eva Air had an excellent safety record, first class onboard cuisine — see my food blog — and locked in cheap oil prices. New planes offer great flexibility short and long haul and it has a neutral name not associated with any country or religion.

And yet, the airline as axing flights and seemingly retreating from profitable routes as well as loss making ones.

Eva Air would be a fantastic hub carrier for East Asia with great connections to US, Europe and Australia. It serves all major cities in Southeast Asia, Japan and China. Due to the time zone, connecting times are short. Cross Pacific routes are profitable due to the big Taiwanese diaspora in cities like Los Angeles, San Francisco and New York.

The tech industry employs thousands of Taiwanese and Taiwanese companies like TSMC or Foxconn are setting up new production sites.

Eva has a profitable cargo network in high demand, integrated maritime connection and a new and partly refurbished airport at its disposal.

So, why is it not expanding like mad and dominating the market like the Middle East carriers do?

The reasons are not entirely obvious but they have to do with Taiwanese risk-avoidance, a conservative management style, lack of government guarantees and most of all a certain lack of confidence in cones own abilities — a core element of Taiwanese business culture and not surprising in a country that has lived under the shadow of its huge neighbor and internal political strive for decades.

Published by Dr Martin Hiesboeck

Futurist, Marketer, Policy Advisor for Companies and Government Head of Blockchain and Crypto Research at Uphold and CEO of Alpine Blockchain Consultants Zurich - London - New York - Taipei

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