Qantas to Cease Operations of Jetstar Asia, Impacting International Flights and Employment
The closure of Jetstar Asia will eliminate flights from Broome to Singapore and result in approximately 500 job losses in Singapore.
Qantas Airways has announced the closure of its low-cost subsidiary, Jetstar Asia, which will come into effect by the end of July 2024. The decision includes the discontinuation of flights from Broome, a town in Western Australia, to Singapore, with services ceasing on July 29, 2024. Jetstar Asia has been operating for over 20 years and serviced 16 different routes across Asia.
The elimination of the Broome-Singapore route was expected to bring in an estimated 6,500 passengers to Broome during its first year of operation.
The airline announced that approximately 500 jobs would be lost in Singapore as a result of this decision; however, the redeployment of some aircraft to domestic flights in Australia will create roughly 100 new jobs.
The Broome route had been operational twice weekly between April and October for two years, providing a direct international connection for Kimberley residents and tourists, as opposed to the previous necessity of transferring flights in Perth.
Local businesses expressed disappointment, highlighting the adverse impact on tourism and visitor numbers.
Business owners indicated that the service was integral to attracting international tourists and connecting the community with Asia.
In a statement, a Jetstar Asia representative characterized the closure as a "difficult decision" and expressed regret for the impact on local tourism.
Affected passengers will receive full cash refunds to facilitate alternative travel arrangements.
Qantas has attributed the closure to escalating operational costs, increased competition, and uncertainties within the global economy, which have negatively affected the profitability of Jetstar Asia.
The decision comes as the airline anticipates reporting a $35 million underlying loss for the current financial year.
The cessation of Jetstar Asia’s services is notable within a broader context of the aviation market, particularly as Virgin Australia prepares to re-emerge as a listed company, indicating a more competitive domestic landscape.
Qantas plans to redeploy 13 Airbus A320 aircraft from Jetstar Asia, redistributing them within its Australian operations to enhance domestic capacity.
This move is anticipated to influence pricing and offerings in the domestic market, as Jetstar continues to expand operations within Australia.
Aviation analysts indicated that the shift to domestic operations may help mitigate the adverse effects of Jetstar Asia’s closure, although Qantas could face restructuring costs of approximately $175 million associated with staff redundancies, fleet adjustments, and other operational changes.
The impact of these developments is poised to resonate within both the local and regional aviation industries.
The elimination of the Broome-Singapore route was expected to bring in an estimated 6,500 passengers to Broome during its first year of operation.
The airline announced that approximately 500 jobs would be lost in Singapore as a result of this decision; however, the redeployment of some aircraft to domestic flights in Australia will create roughly 100 new jobs.
The Broome route had been operational twice weekly between April and October for two years, providing a direct international connection for Kimberley residents and tourists, as opposed to the previous necessity of transferring flights in Perth.
Local businesses expressed disappointment, highlighting the adverse impact on tourism and visitor numbers.
Business owners indicated that the service was integral to attracting international tourists and connecting the community with Asia.
In a statement, a Jetstar Asia representative characterized the closure as a "difficult decision" and expressed regret for the impact on local tourism.
Affected passengers will receive full cash refunds to facilitate alternative travel arrangements.
Qantas has attributed the closure to escalating operational costs, increased competition, and uncertainties within the global economy, which have negatively affected the profitability of Jetstar Asia.
The decision comes as the airline anticipates reporting a $35 million underlying loss for the current financial year.
The cessation of Jetstar Asia’s services is notable within a broader context of the aviation market, particularly as Virgin Australia prepares to re-emerge as a listed company, indicating a more competitive domestic landscape.
Qantas plans to redeploy 13 Airbus A320 aircraft from Jetstar Asia, redistributing them within its Australian operations to enhance domestic capacity.
This move is anticipated to influence pricing and offerings in the domestic market, as Jetstar continues to expand operations within Australia.
Aviation analysts indicated that the shift to domestic operations may help mitigate the adverse effects of Jetstar Asia’s closure, although Qantas could face restructuring costs of approximately $175 million associated with staff redundancies, fleet adjustments, and other operational changes.
The impact of these developments is poised to resonate within both the local and regional aviation industries.
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