Govt hails Jetstar strategy

THE Federal Department of Infrastructure and Regional Development considers that Jetstar’s Pan Asia Strategy has delivered “significant value for Australian consumers and the market more broadly”.

Last month Qantas and Jetstar applied to the Australian Competition and Consumer Commission for re-authorisation to continue wide-ranging coordination involving QF and the Jetstar branded low-cost carriers, as well as full service airline shareholders including Vietnam Airlines and Japan Airlines.

A submission by the department to the ACCC probe into the pact says the Jetstar regional strategy has enabled the various carriers to “grow into markets that would otherwise not have occurred”.

The existing bilateral system and associated restrictions on ownership and control of airlines limit the ability of Qantas and/ or Jetstar from building network reach across Asia, the dept wrote.

“The Jetstar Pan Asia Strategy of establishing immunised partnerships with local businesses provides a means for Qantas and Jetstar to support growth in the broader Asian market... as a result the Strategy has significantly increased connectivity between Australia and Asian markets and delivered a range of benefits, particularly in the context of Australia’s tourism industry,” the submission continues.

The department said the Asia Pacific is a fast growing market sector that is “expected to maintain significant growth over the coming decades”.