Qantas, Temasek Order Airbus for Budget Airline

[Wirraway]

Bloomberg

Qantas, Temasek Order Airbus for Budget Airline, Review Says

Aug. 12 (Bloomberg) -- Qantas Airways Ltd. and Temasek Holdings Ltd. have ordered eight Airbus SAS A320 aircraft worth $320 million for their proposed Asian discount airline, the Australian Financial Review reported.

The airline, due to start flying by the end of the year, will probably be called Jetstar Asia and have similar livery and logo to the Qantas-owned Jetstar brand in Australia, the newspaper reported, without saying where it got the information.

Jetstar Asia has ordered eight A320 aircraft, which cost $40 million each, the newspaper said. Most of its aircraft will be leased rather than purchased, the newspaper said.

Jetstar Asia will initially take two aircraft out of Jetstar's Australian fleet purchase because of a backlog of aircraft orders, the newspaper said. Qantas owns 49 percent of the venture, with 19 percent owned by Temasek, a Singapore state- owned investment company, and 31.1 percent owned by two Singapore businessmen, the newspaper said.

(Australian Financial Review, 8-12, online)

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[Buster Hyman]

Airbus SAS A320

Does that mean they don't need Sky Marshalls????

[Wirraway]

Thurs "Australian Financial Review"

Jetstar Asia to spend $450m

Qantas's new no-frills Asian airline will start up with eight new aircraft after clinching a $US320 million ($450 million) deal that will have the Singapore-based carrier operating Airbus A320s.

The airline a joint venture with the Singapore government's investment vehicle, Temasek, and two Singaporean businessmen is due to start flying by the end of the year.

The budget carrier is likely to be called Jetstar Asia and have a similar livery and logo to its Australian domestic counterpart.

Jetstar Asia is believed to have ordered eight A320s, which carry a ticket price of $US40 million each, though a majority of its aircraft are likely to be leased rather than purchased outright.

Qantas paid $S50 million ($41 million) in April for a 49 per cent stake in the new no-frills airline, which is 19 per cent owned by Temasek and 31.1 per cent by the two Singaporean businessmen.

Jetstar Asia will be a testing ground for the relationship being forged by Australia's biggest airline and Singapore as they try to transform from arch rivals into powerful allies.

Qantas is expected to unveil a record annual profit next week, but like Singapore Airlines faces growing competition from Middle East carriers such as Emirates, which are picking off lucrative Asian and European routes, and from the relentless pressure on costs.

Those factors have encouraged them to forge closer links that may one day lead to a merger creating the world's most powerful airline.

Jetstar Asia will initially take two aircraft out of Jetstar's Australian fleet purchase, in an attempt to circumvent the growing backlog of aircraft orders that has followed the international aviation rebound.

The new airline is unable to apply for its air operator's certificate in Singapore until it has an aircraft on the ground. It is understood the first plane will arrive in October, and the licensing process is likely to take another six weeks after that.

Jetstar Asia's aircraft order pales in comparison to the $US7 billion order by fledgling Middle East-based carrier Etihad Airways last month, or the $US3 billion order from Emirates last month.

But it is still large in comparison with Virgin Blue's $US10 million start-up cost.

Investors have welcomed Qantas's plan to start a Singapore no-frills carrier as a relatively low-price entry into a market with access to as many as 3 billion people.

Qantas's share of the initial $S100 million start-up cost is equivalent to the price of two Boeing 747 wings.

In a sign of strengthening ties, the two flagship carriers are believed to be in talks about how they can combine new training and maintenance facilities for the super-sized Airbus A380.

Working together may save the airlines hundreds of millions of dollars on hangars, flight simulators and training centres.

Both Qantas and Singapore Airlines are convinced that the era of the national flag carrier is over in a world of trading blocs, low-cost airlines, relentless cost pressures and amid volatile oil prices.

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[56P]

SQ, MI, Lionair, Valuair, Jet Star Asia, Air Asia etc etc - ye Gods and little fishes. Sure hope that someone has done the right homework!