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Qantas has announced it is shutting down Jetstar Asia, its budget airline based in
Singapore. Established in 2004, the Asian arm of the low-fares carrier was intended
to tap into the budget airline boom occurring in the region. However, fierce
competition and rising costs meant Jetstar Asia was only profitable in six of its 20
years of operation, leading to the decision to shut down the airline.

Qantas says the move will strengthen its main business in Australia and New
Zealand by freeing up $500 million in capital and making more aircraft available. The
restructure could cut up to 500 jobs at Jetstar Asia. Affected staff will receive
redundancy benefits, employment support, and help finding roles within Qantas or
other regional airlines.

Out of Jetstar Asia’s 13 planes, nine will go to Jetstar in Australia and New Zealand,
and four will be handed over to Network Aviation, a FIFO airline in Western Australia.
Six of the nine aircraft going to Jetstar will replace planes currently leased by the
airline, resulting in significant cost savings.

Five years after its dramatic collapse, Qantas competitor Virgin Australia is set to
make its long-awaited return to the ASX on June 24th, marking a major milestone in
its post-administration recovery. As part of the IPO, more than 236 million shares will
be offered to fund managers and retail investors at $2.90 each, raising approximately
$685 million.
The initial public offering (IPO) reflects Virgin’s successful restructuring, strategic
initiatives, and strong financial performance. The move will provide Virgin Australia
with fresh capital to strengthen its position and potentially challenge Qantas’s
dominance in the domestic market.

Qantas continues to face major legal and financial fallout from its unlawful
outsourcing of around 1,820 ground staff during the COVID-19 pandemic. The move,
partly aimed at avoiding industrial action, was ruled a breach of the Fair Work Act.
In September 2023, the High Court upheld previous rulings confirming the breach.
Qantas has since agreed to pay $120 million in compensation to affected workers
under a settlement with the Transport Workers Union (TWU).
In addition to the payout, Qantas could face penalties of up to $121 million—the
largest ever for a labour law breach in Australia. The Federal Court is expected to
decide on the final penalty in the coming months.

Source: Qantas closes Jetstar Asia, 500 jobs to go after financial losses by Robyn Ironside
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