Jetstar makes Singapore new hub, plans flights to Europe

Qantas's no-frills offshoot, Jetstar, has settled on Singapore as its hub for flights in Asia and as its launch pad for services to Europe.

Jetstar has been considering for three years whether to make Singapore, Bangkok or Ho Chi Minh City in Vietnam its Asian hub. The airline will operate its highest number of services and base its largest number of A320 aircraft in Asia at Changi Airport in Singapore.

The expansion in Singapore is likely to mean it will boost its maintenance operations and cabin-crew base there over coming years.

The airline and its part-owned Singaporean affiliate, Jetstar Asia, already have about 200 cabin crew based in Singapore.

''The clear operational advantages of Singapore as a hub and primary access point into Asia are clear and can now be further built upon,'' Jetstar's chief executive, Bruce Buchanan, said yesterday.

Jetstar Asia also said it would do its own aircraft maintenance rather than outsource the work.

The Australian airline will decide in coming months whether to use three new A330 aircraft due for delivery this year on flights within Asia or to Europe.

Yesterday it indicated it was likely to focus on increasing flights within Asia before starting services to Germany, Greece or Italy. Asia offers annual growth in passenger traffic of 6 per cent, compared with about 2 per cent in Europe.

The decision to make Singapore its hub follows Jetstar's agreement this month to a strategic alliance with the Malaysian low-cost airline AirAsia aimed at slashing procurement costs.

Meanwhile, the latest government statistics show Qantas's share of the international passenger market has fallen to less than 20 per cent for only the second time.

The main carrier Qantas, which has the kangaroo logo on its aircraft tails, had 19.8 per cent of the market in November, down 4.5 percentage points from the corresponding month in 2008.

By comparison, Jetstar increased its market share to 8.5 per cent in the same month - up from 6 per cent in November 2008 - making it the third-biggest carrier of passengers behind Qantas and Singapore Airlines.

Apart from reinforcing the transfer of flights from Qantas to Jetstar, the latest figures show Emirates increased its share of the international passenger pie from 7 per cent to 8 per cent, at the same time as other carriers such as Singapore Airlines and Air New Zealand have shed capacity.

Shares in Qantas closed up 3c at $2.87 yesterday.