Peach Aviation, a Japanese budget carrier, on Tuesday launched its first international route linking Seoul and Osaka, signaling fiercer competition with Korean and foreign low-cost airlines here.

The low-cost unit of All Nippon Airways, based in Osaka, is the first budget carrier in Japan, and was established in February last year.

Considering its low brand awareness in Korea, the late comer into the market pledged to focus more on a very basic principle ― offering cheaper deals, CEO Shinichi Inoue said Tuesday in Seoul.

“It takes just one hour and 40 minutes between the two cities. Rather than offering meals or other services, we want to charge minimum fares on travelers using the Korean route,” he said at a press conference held in central Seoul. 

The Seoul-Osaka route operates seven times a week from Tuesday. The flight scheduled will be increased to 21 times per week from July, the company said.

In order to lower the fares, Peach charges fees for all luggage unlike other budget carriers that allow one item free of charge. Users also are required to pay to select a seat under a no-refund policy.

The fares for a one-way ticket are 75,500 won-295,500 won ($66-$260) with oil surcharges included.

“Despite a slight decrease in Korean travelers visiting Japan since an earthquake in Northeastern Japan last year, we still believe the market potential is enough between Korea and Japan,” the CEO said.

Last year, the number of Koreans visiting Japan was 1.65 million while Japanese people visiting Korea was 3.28 million.

“We are looking to open new routes connecting the two countries within the four-hour distance. But the priority still should be economic feasibility,” he said.

Since its first flight in March this year, Peach has carried more than 670,000 travelers, with the boarding rate hovering at 83 percent.

The company aims to reach the break-even point within three years, the CEO said.

By Lee Ji-yoon (jylee@heraldcorp.com)