New low-cost carrier to exploit huge China market

Qantas and China Eastern agree to launch low-cost carrier

A potentially huge market could be tapped by a new LCC to be launched from Hong Kong into the Chinese market. Australia’s Qantas Group, which already operates the successful budget carrier Jetstar, and China Eastern Airlines announced today that they had agreed to launch a new low-cost airline for the Chinese market – Jetstar Hong Kong. Crucially, it will be the first LCC to be based in Hong Kong, Qantas says. It will start operations in 2013 with three A320s, increasing the fleet to 18 by 2015. The two companies will be equal partners in the $198 million joint venture.
The move is interesting as China does not formally permit low-cost carriers, and international operations are more constrained in terms of market access. What Qantas and China Eastern have achieved is a foot in the door of what will be the biggest market in the world in a few years.
[pictured: Qantas A380; courtesy Qantas]

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