Vietnam Airlines and Qantas Airways pour $139 million into JPA

Friday, Apr 22, 2016 17:18

Representatives of Vietnam Airlines and Jetstar Pacific Airlines at the ceremony to accnounce their partnership in the Lotusmiles programme. — Photo VNA
HA NOI (Biz Hub) — Low-cost carrier Jetstar Pacific Airlines (JPA) will receive US$139 million from its big shareholders, the national flag carrier Vietnam Airlines and Australia's Qantas Airways, to develop the fleet and occupy air transport market share in the 2016-20 period.

The information was released by JPA CEO Le Hong Ha at a ceremony to announce their partnership in the Lotusmiles programme - part of the strategy to promote the Vietnam Airlines–Jetstar Pacific dual-brand on April 20.

"Vietnam Airlines contributed US$39 million and the remainder was from Qantas Airlines. With this support, Jetstar will increase its fleet to 30 aircraft by 2020 in order to expand its market," said Ha.

Ha said JPA had been restructured on business, quality and service products since it began co-operating with Vietnam Airlines in February 2012.

At that time, Ha said JPA was facing a shortfall in its ownership capital, was failing to pay costs and had many unpaid debts.

After receiving a transfer of State-owned capital at JPA from the State Capital Investment Corporation, Jetstar and other shareholders have built a comprehensive restructuring plan. It is focused on increasing charter capital, and restructuring the fleet, airway network and management system to help the airline escape from its unbalanced finances and business losses. It would then recover regularly and develop business.

JPA has achieved many positive results since restructuring. Its business and operations have been stabilised, meanwhile its losses are being reduced annually.

"A report from the auditing firm Deloitte Vietnam showed that after many years of operating losses, JPA had balanced its receipts and expenses with a pre-tax profit of VND267 million in 2015," said Ha.

According to Ha, JPA has closely co-operated with its shareholders Vietnam Airlines and Qantas Airways to create service products for customers in the domestic market.

In the 2016-20 period, Ha said his firm would maintain its development as a low-cost carrier, but at a scale large enough to ensure competition in the low-cost segment. Meanwhile, it would perfect service products on the Vietnam Airlines's network to develop a dual-brand Vietnam Airlines–Jetstar Pacific on domestic and international routes in the Southeast and Northeast Asian regions.

The two sides' Lotusmiles programme is part of a strategy to promote the Vietnam Airlines-Jetstar Pacific brand and aims to diversify their products and services, creating more options for passengers, especially for members of the Lotusmiles programme.

Vietnam Airlines and Jetstar Pacific said they were offering special deals to members of the programme from April 15 to June15.

In 2015, Vietnam Airlines and Jetstar Pacific Airlines implemented a codeshare agreement on all domestic flights of Jetstar Pacific, offering more choices to customers, who could now travel by air at a lower cost while still enjoying the benefits of the special offers. The two airlines will continue codesharing on Jetstar Pacific's international routes till June 2016. — VNS

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