Jetstar winning fight with Tiger Airways
An article in Adelaide Now says that incoming low-cost domestic airline Tiger Airways has failed to impact on the sales of its major rival, Jetstar.
The Singapore-based carrier – which will begin its domestic services from late November – has been selling fares on its eight domestic routes for three months, five of those directly competing with Jetstar.
Jetstar chief executive Alan Joyce said the Qantas subsidiary’s sales had not declined on the competing routes.
When Tiger announced its budget fares in June and July, Jetstar hit back with venom and undercut its rival within hours, except on the Melbourne to Perth route where Tiger’s bare-bones $60 fare could not even be matched.
Alongside Perth, the budget carriers will compete on the highly lucrative Gold Coast route, as well as Launceston, Sunshine Coast and Darwin.
“They are relatively small and our guys are saying they haven’t noticed any impact from Tiger,” Mr Joyce said in Kuala Lumpur this week where he launched a three-weekly service to the Malaysian capital.
“Virgin Blue is the one we are more focused on.” “Their profitability is very strong, they have a great brand and we don’t discount anything Virgin do.”
Tiger, an off-shoot of Qantas rival Singapore Airlines, operates a successful short-haul international market out of Singapore, which already has connections to Darwin and Perth.
From December, passengers will be able to fly from Melbourne to Singapore, via Darwin, with prices starting at $500 return.
At present, Jetstar International does not fly into Singapore, but is set to take over its subsidiary Jetstar Asia route connecting Cairns and Singapore early next year.
While pledging to crush its Singapore-funded rival on its competing domestic routes, Mr Joyce also claimed Tiger had made some surprising route choices that would be difficult to secure market share.
Tiger will commence flights from Melbourne to Rockhampton and Mackay in December, destinations that Jetstar dropped from its Sydney schedule last year because of a lack of interest.
“Everybody has to make their own decisions about where they are going to fly.”
“I would say from my perspective, if I was flying five aircraft I would’ve picked completely different routes,” Mr Joyce said.
“We’ve had some experience on some of those routes and we flew from Sydney to Rockhampton and Mackay and they’ve never been the greatest of markets.”
“They are OK from Brisbane, but if they didn’t work for us from Sydney, I would be surprised if they work from Melbourne.”
“But they could prove everybody wrong.”
Report by The Mole
John Alwyn-Jones
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