Qantas Expands Its Wings to China

Qantas Airways plans to expand in China as part of its efforts to turn its international operations profitable by forming a premium carrier in Southeast Asia and a budget venture in Japan.

The two new airlines, which are scheduled to begin operations next year, will add to Qantas operations in Vietnam Singapore and Australia.

Qantas chief executive Alan Joyce said there is a huge opportunity for Qantas to grow within the Asian markets.

“Having premium and low cost units serving China and the rest of the region is critical,” Qantas boss said.

Qantas is set to order 110 Airbus SAS A320s including 78 of the revamped Neo version to support both the new Southeast Asia premium carrier and the Japan budget venture.

The airline is counting on winning sales in the China markets to help turn around overseas operations which are currently losing around AUD$200 million a year.

Qantas budget carrier Jetstar has lead the way to the Airlines growth in Asia by offering flights to eight cities from Singapore.

Mr Joyce stated that the budget carriers, Vietnam unit also plans to add China flights.

“Chinese services represent more than ten percent of Qantas international revenue, compared with low single digit five years ago,” Mr Joyce added.

The carrier has yet to decide whether it will base its new premium airline in Singapore or Kuala Lumpur, however will announce its decision in the next couple of months.