SINGAPORE: Jetstar Asia operations will cease at the end of July, with more than 500 employees impacted and 16 regional routes affected, spanning countries such as Malaysia, Indonesia, Thailand, the Philippines and Japan.
The announcement on Wednesday (Jun 11) comes as the airline grapples with increasing supplier costs, high airport fees and rising competition in the region.
It marks an end to over two decades of air travel under the Singapore-based budget airline, whose parent company is Qantas Group.
Follow live updates:
2 minutes ago
Statement by Qantas Group CEO Vanessa Hudson
“Jetstar Asia has been a pioneering force in the Asian aviation market for more than 20 years, making air travel accessible to millions of customers across Southeast Asia.
“We are incredibly proud of the Jetstar Asia team and the work they have done to deliver low fares, strong operational performance and exceptional customer service. This is a very tough day for them. Despite their best efforts, we have seen some of Jetstar Asia’s supplier costs increase by up to 200 per cent, which has materially changed its cost base.
“I want to sincerely thank and acknowledge our incredible Jetstar Asia team who should be very proud of the impact they have had on aviation in the region over the past two decades.”
20 minutes ago
Qantas shares not taking off
Investor reaction seems muted to the news of Jetstar Asia’s looming closure.
Shares of Qantas, the budget carrier’s parent company, are trading slightly lower at A$10.59 as of 9.20am Singapore time, a 0.47 per cent decline from yesterday’s close.
Qantas said that closing Jetstar Asia will unlock hundreds of millions of dollars in capital, which will be recycled into the core business and “improve long-term returns”.
For now, though, that’s not a message which is translating into investor excitement.
21 minutes ago
What should customers do?
Jetstar Asia will continue to operate flights for the next seven weeks, before its final day of operation on Jul 31.
But note that there will be changes to the airline’s usual schedule. “We will reach out directly if there are any changes to your upcoming flight,” said Jetstar Asia.
If you are not contacted with any schedule changes, your original flight will operate as planned.
If you have existing bookings on cancelled flights, you will be offered full refunds. Qantas said it will try to reaccommodate customers onto other airlines where possible.
If you have a Jetstar voucher, you’ll be contacted in August to arrange converting your remaining voucher balance to a monetary refund.
31 minutes ago
Why is Jetstar Asia closing?
In a notice on its website, Qantas said Jetstar Asia has faced growing challenges in recent years
“Jetstar Asia has been impacted by rising supplier costs, high airport fees, and intensified competition in the region,” Qantas said.
“The airline is expected to post a A$35 million underlying EBIT loss this financial year, prior to the closure decision.”
Some of Jetstar Asia’s supplier costs have increased by up to 200 per cent, said Qantas Group CEO Vanessa Hudson.
The closure will free A$500 million (US$326.40 million) in capital for Qantas to invest in its fleet renewal plans.
38 minutes ago
Hello
We’re tracking the big news here in Asia this morning – Jetstar Asia, Qantas’ Singapore-based budget airline – will cease operations on Jul 31.
More than 500 people will be laid off.
The airline currently operates flights between Singapore and destinations in Malaysia, Indonesia, Thailand, the Philippines, China, Sri Lanka, Japan and Australia.
Stay with us for the updates and reactions.