Jetstar Hong Kong - evaporating raison d'etre
This announcement by MU, is another harbinger of doom for JHK. It joins a long list of increasingly pessimistic markers for the embattled wannabe in HKG.
First mover advantage has now gone. Hong Kong Express has taken the yellow jersey and is the first LCC domiciled in the fragrant harbour.
Slots get ever more constrained as the 'noise lobby' grows increasingly powerful and the incumbent carriers expand into, and soak up the available capacity at CLK.
The Jetstar pan-asia strategy is visibly struggling. Jetstar Asia is unprofitable. Jetstar Pacific is a political nightmare. Jetstar Hong Kong is a distant dream. Jetstar Japan is slow and problematic. I won't mention the issues emerging with the Jetstar mothership in Australia and New Zealand. And, of course, we are all abundantly aware of the existential problems that Qantas faces.
All of which shines a very bright light on the implications from this announcement by MU that they are going it alone with the development of a LCC in China. It has long been my view that Jetstar Hong Kong was a beach-head operation. An opening ambit. A foothold on the mainland. A way of gaining access to the Peoples Republic of China.
As we all know, the growth potential of the PRC is gigantic. I have long suspected that Jetstar saw the Hong Kong operation as a first step toward the ultimate goal - spawning their franchise into China. China Eastern was seen as a suitable partner - not only because Cathay spurned Qantas, but because MU presented access to China.
Therefore, the announcement that China Eastern is now 'going it alone' with a LCC in China, is the starkest evidence yet that MU has lost confidence in the ability of Jetstar to deliver on their undertaking to establish an airline in Hong Kong.
In a world of rational self-interest - Jetstar was using China Eastern (for local credibility and market access) and China Eastern was using Jetstar (for know-how). Now that it has become evident that Qantas and Jetstar lack the requisite know-how - China Eastern have quite rightly decided to go it alone.
Perhaps Qantas could come to an arrangement with China Eastern; to sell them all the surplus airframes that are dotted around France. That way MU gets it's LCC up and running quickly and Qantas/Jetstar are able to reduce the burden of countless idle aircraft???