Qantas and China Eastern Airlines have entered into an alliance to bring low-cost carrier Jetstar to Hong Kong.
Subject to regulatory approval, Jetstar Hong Kong services will start in 2013 with a fleet of three Airbus A320s, growing to 18 A320s by 2015. The airline will serve short-haul routes in Asia, including destinations in Greater China, Japan, South Korea and Southeast Asia. It will be the first genuine low-cost carrier based in Hong Kong.
Liu Shaoyong, Chairman of Shanghai-based China Eastern commented; “We believe there are huge opportunities for the Jetstar low fares model throughout Asia, including Greater China, and are excited to be the first major Chinese carrier to bring this travel option to the region.
“Cooperation with Qantas Group is a key step in China Eastern Airlines’ international expansion strategy and an excellent opportunity for China Eastern Airlines to develop low-cost carrier operations to complement its existing business model,” Liu added.
Qantas Group’s Chief Executive Officer, Alan Joyce, said the new agreement offered a huge potential market to the Australian carrier.
“Establishing Jetstar Hong Kong in the heart of Asia and on the doorstep of mainland China is a historic opportunity to continue the successful expansion of the Jetstar brand in this region,” Joyce said.
“We know from our experience with Jetstar in Australia and in the set-up of Jetstar Japan the benefits of both a premium and a low-cost airline operating in the same market. This will also apply to Jetstar Hong Kong, which will leverage the local knowledge and scale of China Eastern Airlines with the successful low-cost model of Jetstar,” Joyce added.
Jetstar Group CEO, Bruce Buchanan, said the new airline would undercut rival Hong Kong-based airlines.
“Jetstar Hong Kong’s fares will be 50% less than existing full service carriers, which we’ve seen create new travel demand in our markets across Asia because it enables people to take more trips, more often,” said Buchanan.
“This is a unique opportunity for Jetstar to capitalise on the enormous potential of the Greater Chinese market, where the penetration rate of low-cost carriers is less than 5%, using a model that we know delivers for customers and shareholders,” Buchanan added.
China Eastern Airlines and Qantas will be equal partners in the new venture, which will initially have total capitalisation of up to US$198 million.
The new Hong Kong-based unit will become Jetstar’s fifth regional entity, following existing units in Australia, Singapore, Vietnam and Japan.
China Eastern is a member of the SkyTeam alliance, while Qantas is part of oneworld. Qantas recently said its plans to form an Asia-based premium airline were on hold for up to three years, after a deal with Malaysia Airlines fell through.
Qantas and China Eastern Airlines have entered into an alliance to bring low-cost carrier Jetstar to Hong Kong.
Subject to regulatory approval, Jetstar Hong Kong services will start in 2013 with a fleet of three Airbus A320s, growing to 18 A320s by 2015. The airline will serve short-haul routes in Asia, including destinations in Greater China, Japan, South Korea and Southeast Asia. It will be the first genuine low-cost carrier based in Hong Kong.
Liu Shaoyong, Chairman of Shanghai-based China Eastern commented; “We believe there are huge opportunities for the Jetstar low fares model throughout Asia, including Greater China, and are excited to be the first major Chinese carrier to bring this travel option to the region.
“Cooperation with Qantas Group is a key step in China Eastern Airlines’ international expansion strategy and an excellent opportunity for China Eastern Airlines to develop low-cost carrier operations to complement its existing business model,” Liu added.
Qantas Group’s Chief Executive Officer, Alan Joyce, said the new agreement offered a huge potential market to the Australian carrier.
“Establishing Jetstar Hong Kong in the heart of Asia and on the doorstep of mainland China is a historic opportunity to continue the successful expansion of the Jetstar brand in this region,” Joyce said.
“We know from our experience with Jetstar in Australia and in the set-up of Jetstar Japan the benefits of both a premium and a low-cost airline operating in the same market. This will also apply to Jetstar Hong Kong, which will leverage the local knowledge and scale of China Eastern Airlines with the successful low-cost model of Jetstar,” Joyce added.
Jetstar Group CEO, Bruce Buchanan, said the new airline would undercut rival Hong Kong-based airlines.
“Jetstar Hong Kong’s fares will be 50% less than existing full service carriers, which we’ve seen create new travel demand in our markets across Asia because it enables people to take more trips, more often,” said Buchanan.
“This is a unique opportunity for Jetstar to capitalise on the enormous potential of the Greater Chinese market, where the penetration rate of low-cost carriers is less than 5%, using a model that we know delivers for customers and shareholders,” Buchanan added.
China Eastern Airlines and Qantas will be equal partners in the new venture, which will initially have total capitalisation of up to US$198 million.
The new Hong Kong-based unit will become Jetstar’s fifth regional entity, following existing units in Australia, Singapore, Vietnam and Japan.
China Eastern is a member of the SkyTeam alliance, while Qantas is part of oneworld. Qantas recently said its plans to form an Asia-based premium airline were on hold for up to three years, after a deal with Malaysia Airlines fell through.
