Taipei's Taoyuan International Airport has dropped plans for a dedicated low-cost terminal as it is unable to find a suitable site for the building.
The airport had initially planned to convert an old catering facility, located across from its Terminal 1, into a low-cost terminal. The plan was dropped, however, as the 0.8 hectare (2 acre), two-storey facility was found to be too small, Tim Ting, the airport's business planning and marketing department's senior specialist, tells Flightglobal Pro.
"The building is only half the size of Changi's old Budget Terminal. It's not a suitable site because if we use this, very soon it will be overcrowded," he explains.
The airport handled 1 million passengers who travelled with low-cost carriers in 2012, 10% more than in 2011. This year, it is expecting that number to grow by another 10% at least.
With plans for a dedicated low-cost terminal temporarily shelved, the airport is studying the feasibility of better accommodating low-cost operators by offering them a lower price package. This will likely include lower landing and parking fees if the carriers choose slots with less desirable timings.
"We could roll out this differentiated pricing for the LCCs within this two years," says Ting.
Another option the airport has in mind is to transform Terminal 1 into a low-cost terminal once its third terminal is up and running.
Construction of the terminal is scheduled to start in 2014 and end by 2018. Terminal 3, together with a remote concourse, is expected to add 43 million to the airport's capacity.
"Everything is still pending. But if we do have a home-based LCC, we'll also need to consider how we can best accommodate them," adds Ting.
China Airlines recently said it has formed a "special team" to evaluate the possibility of launching an LCC in the face of rising competition from such budget operators.
Twelve foreign LCCs now operate services to Taipei.