Why Wasn’t Oasis Hong Kong Airlines Sustainable In The Long Term?

The route between London and Hong Kong has long been a key air route for carriers based at both ends of the corridor. One Hong Kong-based operator that tried its hand at getting a share of this potentially lucrative market was Oasis Hong Kong Airlines, which was founded back in 2005. The project turned out to be unsustainable in the long term, but why?

A rocky start

Oasis Hong Kong Airlines came into existence when Raymond and Priscilla Lee founded the new carrier in 2005. It had considerable firepower at the management level, with Dragonair founder Stephen Miller appointed its CEO. According to ATDB.aero, Oasis Hong Kong Airlines received its air operator’s certificate (AOC) on October 19th, 2006.

After this, the new airline wasted little time in getting off the ground. That being said, it didn’t have the easiest maiden voyage. This was set to take place between Hong Kong and London Gatwick on October 25th, 2006. However, things didn’t go entirely to plan.

Much like the first passenger-carrying flight of the Boeing 747, Oasis Hong Kong Airlines ended up hitting the skies a day later than planned. This came after its permission to use Russian airspace on the way to the UK was revoked just an hour before its planned departure on October 25th. However, it was eventually able to begin properly a day later.

Too good to be true

Despite being a new airline, Oasis was actually a decent competitor for existing carriers on the London-Hong Kong route, to begin with. The same was true for its other initial route, which served Vancouver. Indeed, its all-Boeing 747-400 fleet allowed economy class passengers to enjoy a 32-inch seat pitch, which was equal to or better than its rivals.

The airline also boasted a competitive business class product, whereby drinks and snacks were free. All passengers were entitled to two hot meals regardless of their class of travel, as well as the use of an extensive personal entertainment library on seatback TVs. What’s more, they could enjoy these generous aspects at fares that began as low as £75 ($103).

However, this part of the airline’s business model was ultimately what caused its long-term unsustainability. Despite claiming to have broken even in its first six months, Oasis’s low fares meant that it could not viably support its operations. Its use of London Gatwick was also unfavorable, compared to its competitors, which flew to Heathrow.

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The end of the line

In the end, Oasis Hong Kong Airlines could only manage around 18 months of operations before collapsing. In April 2008, its losses reached a point where the carrier was forced into liquidation by KPMG China. KPMG announced that unsecured creditors would only receive 10% of what they were owed. This estimate dropped to 5% in September 2008.

As for Oasis Hong Kong Airlines, its final flight took place on April 8th, 2008. Numbered as O8901, the Boeing 747-400-operated service departed from Vancouver at 10:15 local time. It reached Hong Kong at 15:09, bringing 18 months of operations to a close.

Did you know about Oasis Hong Kong Airlines? Perhaps you even flew with this short-lived carrier? Let us know your thoughts and experiences in the comments.

Source: https://simpleflying.com/oasis-hong-kong-airlines/