Qantas, Vietnam Airlines to pump $139m into Jetstar Pacific JV

Australian flag carrier Qantas and the recently privatised Vietnam Airlines have announced they will invest a total of $139 million to more than double the size of the Vietnamese joint venture, low-cost airline Jetstar Pacific‘s fleet, according to a Sydney Morning Herald report.

Qantas will fund $42 million for Jetstar Pacific, which is in line with its current ownership of 30 per cent in the JV, while Vietnam Airlines will contribute the remaining 70 per cent of the planned financing. The total number of Jetstar Pacific aircrafts is reported to increase from the current 12 to 30 units over the next four years.

The investment will be executed in tranches from now until 2020, the Australian publication said.

The latest announcement came as later last year, the two flag carriers agreed on a long-term expansion for their JV to boost its fleet, which will help Jetstar Pacific become Qantas’ largest offshore Asian budget airline.

In the first half of the Qantas financial year, Jetstar Pacific capacity rose by 48 per cent, although the percentage of seats filled dipped to 83.4 per cent from 88.3 per cent a year earlier, according to the Sydney Morning Herald.

The low-cost arm of heavily state-owned Vietnam Airlines, Jetstar Pacific, is in intensifying competition with Vietjet Air, the aviation company to create Vietnam’s first woman billionaire. With an IPO expected this year, Vietjet is going to overtake the domestic market with a 40 per cent market share, the CAPA Centre for Aviation said in a report earlier this year.

The rival has already reached the 30 aircraft milestone and is expected to add a staggering amount of 70 others by 2021.

“The evolution of the Jetstar Pacific model was inevitable but was slow to materialise, a mistake that has benefited VietJet,” CAPA said.

Jetstar Pacific released its profit result of VND267 million ($11,800) for last fiscal, saying it was the first profit ever gained in eight years.

The carrier is fostering its operation by opening new domestic routes and offering promotions, while Vietjet has also planned to launch three new domestic flights.

Also read:

Vietnam Airlines plans domestic unit to take on budget carriers

Vietnam: Bikini-clad carrier VietJet plans IPO in a bid to go global

VietJet Air expects to raise $800m from IPO

Japan’s ANA to buy 8.8% stake in Vietnam Airlines Corp

Singapore Reporter/s

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.