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Qantas, China Eastern to set up budget airline

Updated: 2012-03-26 11:06

(Xinhua)

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SYDNEY - Australia's airline Qantas announced on Monday that it had entered a new alliance with China Eastern Airlines to create new budget airline, Jetstar Hong Kong, in China.

Jetstar Hong Kong will begin flights in 2013, flying short-haul routes in Asia, including Greater China, Japan, South Korea and Southeast Asia, Qantas said on Monday.

The maximum capitalization of establishing the airline will be $198 million.

"The shareholding percentage in Jetstar Hong Kong will be equally held by China Eastern Airlines and Qantas Group, which will be equal partners in the joint venture," Qantas said in a statement on Monday.

Qantas Chief Executive Officer Alan Joyce said the new agreement would build a strong platform for accessing the world's largest, fastest growing and most profitable aviation market.

"We see tremendous potential for the Qantas Group in Asia and we're looking forward to working more closely with China Eastern Airlines to deliver on it," Joyce said in the statement.

Chairman of China Eastern Airlines, Liu Shaoyong, said the airline was pleased to be extending its 20 year relationship with the Qantas Group.

"We believe there are huge opportunities for the Jetstar low fares model throughout Asia, including Greater China, and are excited to be the first major Chinese carrier to bring this travel option to the region," Liu said.

The Jetstar Group is Asia Pacific's fastest growing and largest low fares network by revenue, with airlines in Singapore, Japan, Vietnam, Australia and New Zealand. It operates up to 3,000 flights a week to almost 60 destinations.

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