Fighting it out...        Qantas vs Jetstar

Jetstar to battle with Qantas on some European routes JETSTAR plans to fly to destinations in Europe previously abandoned by Qantas but could also go head-to-head with its parent on existing routes by offering fares of $1000 or lower.

Its assault on the European market is likely to begin at the end of 2009 when the low-cost carrier takes delivery of up to 15 Boeing 787 Dreamliner aircraft, which will allow its international arm to fly long-haul routes.

Jetstar is likely to offer about 4500 seats a week - 234,000 a year - to Europe from the outset. That is about one-sixth of the seats now flown by Qantas on its 35 return flights a week into London and Frankfurt using Boeing 747s.

The move also sends a signal to the wider Qantas group that its dominance of long-haul services is coming to an end, even though Jetstar International hopes to grow the number of passengers overall rather than cannibalising its parent's traffic and profits.

However, Jetstar's management is acutely aware of the threat posed to its own overseas expansion by low-fare operators such as AirAsiaX, a joint venture between Malaysia's budget airline Air Asia and Sir Richard Branson, part-owner of Virgin Blue in Australia.

AirAsiaX recently announced plans to fly services between England, Malaysia and Australia and hopes to get a two-year head start on Jetstar.

At this stage Jetstar does not plan to piggy-back on the so-called kangaroo route from London to Australian cities on which the big carriers operate.

Instead, it is looking at servicing the popular holiday destinations of Amsterdam, Athens, Munich, Frankfurt, Rome and Paris, from Sydney and Melbourne.

Jetstar would compete directly with Qantas on the last three cities, although its parent operates a codeshare system with Air France to Paris and with Cathay Pacific to Rome.

Jetstar is also considering four options for stopovers to Europe: Kuala Lumpur, Singapore, Bangkok and Ho Chi Minh City in Vietnam. Each have attractions. Bangkok is closest to Europe, while Singapore is the biggest aviation hub in Asia through which Jetstar already operates.

Kuala Lumpur would allow Jetstar to take on AirAsiaX directly. But the surprise choice could be Vietnam, which is a rapidly growing route now serviced direct by Jetstar out of Sydney.

Qantas picked up an 18 per cent stake in Pacific Airlines, Vietnam's second-largest airline, in July, with the aim of owning a third of the company. It also has agreement with Pacific's other shareholders to turn the airline into a budget carrier along the lines of Jetstar.

Source | www.smh.com.au

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on-some-european-routes/2007/10/23/1192941065311.html