Skymark Airlines

Low-cost airline operations (1996–2010)

Skymark Airlines was founded in November 1996 as an independent domestic airline after deregulation of the Japanese airline industry and started operations on 19 September 1998. It was originally owned by a consortium of investors led by the travel agency H.I.S. and headed by H.I.S. president Hideo Sawada; another major early investor was the leasing company Orix. Its initial business plan called for it to be headquartered at Itami Airport in Osaka. Takashi Ide, former head of British Airways' operation in Japan, was hired as the company's CEO in 1998.

Skymark was able to obtain six slots at Haneda Airport in Tokyo in March 1997 and moved its headquarters to the Hamamatsucho district of Tokyo in March 1998. Its first scheduled flight from Haneda to Fukuoka was on 19 September 1998; it added routes from Itami to Fukuoka and Sapporo in 1999, but suspended these routes in 2000 in order to offer more frequencies on the Haneda-Fukuoka route.

In 2002, Skymark took delivery of a third Boeing 767 aircraft and began service on the Haneda-Kagoshima route, as well as charter service from Haneda to Seoul. In 2003, with a fourth 767 dry-leased (leased without any crew members) from All Nippon Airways, it began service to Aomori and Tokushima.

The airline incurred considerable losses in its first few years of operations. It briefly considered a recapitalization led by Commerzbank but decided not to accept such an investment due to Air Do's issues with banks interfering in management. In August 2003, Sawada invited internet entrepreneur Shinichi Nishikubo to become Skymark's largest shareholder with a personal cash investment of 3.5 billion yen (having made around 9 billion yen from the IPO of his internet company in 2000). Nishikubo took over as CEO in 2004, maintaining Ide as a "co-pilot" due to Ide's experience in the aviation industry.

On 11 December 2003, Skymark announced that it expected a profit of 470 million yen for the half-fiscal year ending on 31 October, the first profit made since the airline began operations. By using more efficient aircraft and systems developed in-house, Skymark attempted to undercut JAL and ANA on costs in order to offer lower fares.

Skymark had a code sharing partnership with Japan Airlines starting with a Haneda-Osaka Kansai service in 2005–06, and later on the Tokyo Haneda-Kobe route from Kobe Airport's opening in 2006. JAL withdrew from Kobe in 2010, while Skymark developed Kobe into a secondary base. Skymark purchased the naming rights for the Kobe Sports Park Baseball Stadium from 2005 to 2010.

Skymark announced in April 2010 that it would commence a "Narita Shuttle" service from Narita International Airport to Asahikawa, Sapporo, Fukuoka, and Okinawa in late 2011 and early 2012.

Shift to premium service (2010–2014)

In November 2010 Skymark announced negotiations with Airbus for an order of four Airbus A380 aircraft and two options, making it the first Japanese airline to order the type. The airline announced its intent to use the aircraft on long-haul trunk routes out of Narita Airport such as London, Frankfurt, Paris and New York, and that they would be operated in a two-class, 394-seat configuration – with 114 seats in business class and 280 in a premium economy class. Nishikubo envisioned an unheard-of fully-flat product in economy class, which the Skymark team calculated would break even at a one-way fare of 100,000 yen.

As Skymark began to prepare for international service, it began to face stiff competition from a new group of low-cost carriers in Japan beginning in 2012, particularly from AirAsia Japan (later Vanilla Air), Peach Aviation, Jetstar Japan and Spring Airlines Japan at its Narita base. This led to a reduction in Skymark's frequencies on highly contested routes such as Narita-Sapporo and Narita-Fukuoka, and a refocusing of aircraft on more exclusive routes such as Narita-Ishigaki.

Skymark attempted a more competitive domestic offering by executing leases for seven Airbus A330-300 aircraft in July 2012. Skymark announced that it would outfit these aircraft in a 271-seat single-class premium configuration with 38-inch seat pitch and 22-inch seat width, tentatively called "Green Seats" and comparable to the domestic "Class J" offering on Japan Airlines, to win market share among business travelers on the key domestic trunk routes from Tokyo to Fukuoka and Sapporo. Skymark also had plans to install "Green Seat" cabins on its 737 fleet to create a 2-class configuration but cancelled the plan in early 2014 in favor of keeping a single-class 737 fleet for competition with other LCCs.

Somewhat controversially, Skymark announced that A330 flight attendants would wear miniskirt uniforms, in contrast to Skymark's usual polo shirt uniforms, for the first six months of operation of each route.