China Eastern Airlines and Qantas Announce Jetstar Hong Kong
April 19, 2012China Eastern Airlines and the Qantas Group (which owns the Jetstar Group) have entered a new strategic alliance to bring Asia’s leading low fares airline model to China with the creation of Jetstar Hong Kong.
Jetstar Hong Kong will combine the partners’ local knowledge, networks and successful low cost carrier model to service short haul routes in Asia, including Greater China, Japan, South Korea and South East Asia. It will be the first low fares airline based in 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.
Jetstar Hong Kong is underpinned by a total maximum capitalisation of up to US$198 million. The shareholding percentage in Jetstar Hong Kong will be equally held by China Eastern Airlines and Qantas Group, which will be equal partners in the Joint Venture. The maximum exposure for each partner is US$99 million over a three year period.
Chairman of China Eastern Airlines, Mr Liu Shaoyong, said the airline was pleased to be extending its 20 year relationship with the Qantas Group.
“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,” said Mr Liu.
“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.
“Jetstar Hong Kong’s low fare model will enable people to fly more often for less and will help to stimulate the Hong Kong tourism industry and the broader economy,” said Mr Liu.
Qantas Group Chief Executive Officer, Mr Alan Joyce, said the new agreement would build a strong platform for accessing the world’s largest, fastest growing and most profitable aviation market.
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