Services for Jetstar Asia will continue for the next seven weeks, on a progressively less frequent schedule, with the airline fully closing at the end of July.
The closure will see 13 mid-life aircraft come into service for Jetstar in Australia and New Zealand.
Qantas says its Asia arm has “faced growing challenges in recent years” including increased supplier costs, stronger local competition and high airport fees.
Qantas is forecasting a $35 million pre-tax loss for Jetstar Asia this financial year, while closing the airline is expected to have a $160 million pre-tax impact over the longer term.
The closure of Jetstar Asia will not impact Jetstar Japan, which will continue to run as normal. Jetstar’s Australian operations will continue to service routes from Australia into Asia, including services to Singapore, Thailand, Indonesia, Vietnam, Japan and South Korea.
“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,” said Qantas Group CEO, Vanessa Hudson.
“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.”
Customers booked on flights that will no longer be going ahead will receive a full refund, with efforts made to accommodate them on other airlines.
Qantas is also actively looking for opportunities for Jetstar Asia staff within its own airlines and with other airlines.
The shuttering of Jetstar Asia will bring $500 million worth of fleet capital back into service in Australia and New Zealand and will help service some regional routes.
