Sydney (Agencies): Australian carrier Qantas has announced the closure of Jetstar Asia, its Singapore-based budget airline, citing rising supplier costs, higher airport fees, and intensifying competition as key factors.
The move is expected to free up A$500 million ($326.40 million) in capital, allowing Qantas to invest in fleet renewal. The company confirmed that 13 Airbus A320 aircraft from Jetstar Asia will be redirected to Australia and New Zealand.
Qantas Group CEO Vanessa Hudson stated that some supplier costs have increased by up to 200%, significantly impacting the airline’s cost base. She emphasized that Qantas is undertaking its most ambitious fleet renewal program, with nearly 200 aircraft orders and substantial investment in its existing fleet.
Jetstar Asia, which has operated for over two decades, has struggled against Southeast Asian budget carriers such as Capital A’s AirAsia and Singapore Airlines’ Scoot. The airline is expected to post an underlying EBIT loss of A$35 million in the current financial year.
Jetstar Asia will cease operations on July 31, with flights continuing for the next seven weeks.