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Based in Singapore, Jetstar Asia is a low cost airline. Using the Qantas Group's Jetstar brand, Jetstar Asia has a network of services within Asia using A320 aircraft. Jetstar Asia/Valuair is 51% held by Westbrook Investments Pte Ltd (Westbrook) and 49% by Qantas. (See also: Jetstar Pacific in Vietnam, which is 30% held by Qantas with other shareholders including its largest shareholder, State Capital Investment Corporation, Saigon Tourist Holding Company and Mr Luong Hoai Nam, CEO of Jetstar Pacific.)
Location of Jetstar Asia main hub (Singapore Changi Airport)
LCCs will continue to evolve into hybrids of the original core model. CAPA and OAG consider Jetstar Asia fits the LCC profile and it is included in our reporting on this basis. Please note: when reporting for an airline is changed from or to LCC the historical data is not affected and it can lead to a distortion in the current reported data. Contact us if you have any queries.
249 total articles
Jetstar Asia handles two millionth pax on Singapore-HK, will continue to explore opportunities in HK
Jetstar welcomes the Competition Commission of Singapore’s approval for airline coordination in Asia
45 total articles
SIA, Jetstar & Tigerair drive Myanmar-Singapore growth but visa restrictions remain major impediment
The Myanmar-Singapore market is facing potential over-capacity as more flights are added, led by low-cost carriers. Tigerair launched services to Yangon in Oct-2013 while Jetstar Asia and Golden Myanmar have both unveiled plans to add capacity on the Yangon-Singapore route.
Passenger numbers between Myanmar and Singapore have increased by about 50% over the last two years. But capacity levels are now up nearly 100%.
Without a waiver of current visa restrictions it is unlikely the market will be able to absorb the additional capacity. Singapore has not approved a proposal from Myanmar to lift visa restrictions although Myanmar is the only Southeast Asian country for which Singapore requires visas. A visa free environment is particularly important for the LCCs, which are eager to stimulate demand on the Yangon-Singapore route.
Tigerair & Scoot poised for expansion in under-penetrated Singapore-China market as Jetstar retracts
The Singapore-China market has huge potential for low-cost carriers, which currently only account for 19% of capacity between the two countries. But the market has proven to be challenging for Jetstar, which is cutting two more Singapore-China routes and reducing the LCC group’s capacity share to an insignificant 3% compared to 10% two years ago.
Expansion from Tigerair and Scoot has filled some of the void left by Jetstar. But total LCC capacity and the LCC penetration rate in the Singapore-China market is on the decline, dropping to only 16% in Jan-2014.
Singapore’s overall LCC penetration is now 31% and is continuing to rise. The relatively low penetration in the Singapore-China market is surprising, particularly as the market enjoys open skies. But the long-term potential is there for more LCC services.
Singapore is seeing another surge in low-cost carrier capacity, led by aggressive expansion from Tigerair. LCC groups Jetstar and AirAsia are also continuing to expand in Singapore but more modestly than Tiger.
Tigerair, Jetstar and AirAsia had equal shares of the Singapore market back in 2010. But Tigerair has since grown faster and will widen the gap from its rivals as it adds five more A320s in the current fiscal year. Tigerair will account for almost 11% of total capacity at Singapore Changi by the end of 2013 compared to just under 8% for AirAsia and Jetstar.
LCCs already account for a little over 30% of seats at Singapore – an impressive figure given Changi’s LCC penetration rate was virtually zero a decade ago and its lack of a domestic market. Tigerair’s forthcoming expansion will drive up the LCC penetration further, to about 32%, but it comes with risks as Singapore’s short-haul market could return to the over-capacity situation seen two years ago.
Singapore-Indonesia has emerged as one of the world’s fastest growing markets with capacity up 40% year-over-year. While capacity increases on the two largest routes connecting the two countries – Singapore to Jakarta and Bali – have captured most of the attention, secondary routes are growing even faster.
The third and fourth largest Indonesian destination from Singapore, Surabaya and Medan, will see capacity nearly double in Nov-2013 compared to Nov-2012. To the 10 other smaller Indonesian destinations served from Singapore, capacity is increasing by a collective 78%.
LCC group Tigerair has quadrupled its Singapore-Indonesia operation over the last year, growing its share of capacity in the process from about 4% to 15%. Tigerair now serves eight Singapore-Indonesia routes, up from only two a year ago.
AirAsia has a 17% share and also now serves eight Singapore-Indonesia routes, up from four a year ago although its capacity has increased a more modest 34% from a much higher base. The Singapore Airlines (SIA) Group is the market leader with a 31% share and will soon serve all 14 routes as regional subsidiary SilkAir has added three Indonesian destinations.
The Singapore-Jakarta market is seeing a 24% influx in capacity as several carriers have raced to add flights in 2H2013 following a breakthrough in the bilateral between Singapore and Indonesia. Tigerair and Garuda have led the way with significant increases while Singapore Airlines (SIA) and Jetstar have also pursued more modest additions.
Singapore-Jakarta has become the fastest growing major international route. It is now the second largest international route after Hong Kong-Taipei and the 12th largest overall.
A further 25% increase in capacity is likely in 2014 as carriers implement more of their newly awarded traffic rights.The sudden surge could result in short-term over-capacity. But over time the additional capacity should be absorbed given the fast-growing demand for services to and from Indonesia, which has emerged as one of the world’s most dynamic emerging markets.
Singapore is finally moving forward on plans to open a third runway as part of a new project aimed at making sure Changi Airport remains a leading hub for Southeast Asia. Changi over the last decade has seen a huge rise over aircraft movements driven by the rapid expansion of Singapore’s budget carrier sector. But this has led to congestion of the two existing runways at peak hours.
The third runway and subsequently a fifth terminal will be on Changi’s undeveloped east side, which is currently only used by the military. The fifth terminal will be massive and could potentially double the airport’s capacity to approximately 170 million passengers per annum.
Changi handled 51 million passengers in 2012; it is currently able to handle 66 million passengers and is in the process of adding capacity within the current four-terminal site to handle 85 million passengers. But it is runway rather than terminal capacity which is by far the more pressing issue for Singapore. The third runway is not expected to open to commercial use until 2020, leaving Changi a challenging situation, as it is already turning away some airlines seeking slots for new services.
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