The company says by the beginning of next year the Qantas Group will have a lower cost base than rival Virgin Blue. Qantas will get greater efficiencies when it introduces new aircraft and it's well down the road of restructuring its business, developing the freight and fleet ownership divisions and mooting a new, still unclear ownership structure for the frequent flyer program.
Exactly, the GROUP ie. Jetstar + Qantas when combined have a resultant lower cost base than Virgin. That is no surprise!
I wonder how the situation would be now if Qantas had not started Jetstar? I would have thought that someone like Tiger would have been well established and as big or bigger than Jetstar. So what pressure would that have put Qantas mainline under? A lot more than what they fear from Jetstar?
Qantas has Jetstar as a vehicle to take on other low cost operators, Qantas mainline should be thankful of this, else it would be mainline under much greater cost pressure.