Jetstar targets 20%-plus growth in Asia
Jetstar CEO Bruce Buchanan stated the carrier needs to increase its Asian operations by more than 20% over the next five years to maintain its market share (The Australian, 19-Nov-2010). Mr Buchanan stated market growth of up to 20% in the LCC segment presents a large opportunity for the carrier but added: "To be gaining relative share or position in our segment, we need to be growing faster than that. So the maths is pretty straightforward. We know the challenge, which is now finding the routes and growth opportunities." Mr Buchanan added that the carrier expects continued growth on existing routes while markets such as China and Japan represent large opportunities for expansion. Mr Buchanan stated there were already 200 cities in China that Jetstar could serve with the burgeoning middle class boosting travel demand. On the domestic front, Mr Buchanan stated travel demand was expected to remain stable.
Jetstar: "I think the challenges in both those markets (China and Japan) are the regulatory hurdles and it's making sure we get the right structure in place; we can get the product executed properly. And that means the right local partners, the right government approvals and the right business construct to get it set up ... Vietnam is the same. There's the low internet penetration, its big cash economy, so we had to build ticket outlets on every street corner. That's an example where you need to modify the product offering to succeed in each of those Asian markets.You can't have a complete cookie cutter approach because you just won't succeed as you go into different political, religious, legal and different stages of development in each of those markets," Bruce Buchanan, CEO. Source: The Australian, 19-Nov-2010.
Jetstar: "We haven't seen any major green shoots in the Australian domestic market and we haven't seen any downturn – it's been relatively stable. We obviously have seen some changes in travel patterns, as you would expect with the higher Australian dollar. And we've seen a lot of growth in the Asian region, which has been particularly strong, especially coming off the lulls of last year," Bruce Buchanan, CEO. Source: The Australian, 19-Nov-2010.