AirAsia and Jetstar unveil strategic partnership

6 Jan 2010

Low-cost carriers AirAsia and Jetstar have unveiled plans to work together in a bid to cut costs, lower fares and streamline operations in a major realignment of Asia-Pacific aviation.

Plans include saving on ground-handling costs as well as a reduction in costs for aircraft purchasing, design and maintenance, since both airlines operate similar fleets of Airbus A320s and A330s. This may allow the airlines to better configure the new generation of narrow-body aircraft to suit the airlines’ needs.

The proposals were unveiled this morning in Sydney, by representatives of the Kuala Lumpur-based AirAsia and Qantas-owned Jetstar.

Qantas chief executive Alan Joyce said: ‘‘Jetstar and AirAsia offer unmatched reach in the Asia-Pacific region, with more routes and lower fares than their main competitors, and this new alliance will enable them to maximise that scale.

‘‘The aviation market in Asia is a growth market and has proven resilient over the past 12 months despite the tough operating environment, with significant growth in passenger numbers forecast in the region.”

AirAsia Group chief executive Tony Fernandes said: ‘‘With joint purchasing power it means that we can potentially work with airline manufacturers on the right configuration and design of an aircraft specifically for AirAsia and that best suits our operational needs for the future.”

AirAsia is the Asia Pacific’s largest low-cost carrier (LCC), flying to more than 61 domestic and international destinations with 108 different routes. It operates over 400 flights daily from hubs located in Malaysia, Thailand and Indonesia.

AirAsia X, the airline’s long-haul brand, began flights to Australia in 2007 and has since expanded to routes to China, London and the Middle East.

Aside from its Australian domestic network, the Jetstar group also includes Jetstar Asia and Valuair, both based in Singapore, and Jetstar Pacific in Vietnam. The Jetstar family operates 1,900 weekly flights to 15 countries.

The move is expected to put additional pressure on rival regional budget carriers such as Virgin Blue in Australia and Singapore’s Tiger Airways.

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Kenny Coyle

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