Qantas 2009 Annual Report Download - page 31

29 Qantas Annual Report 2009
Jetstar is the Qantas Group’s low fares airline
and the world’s largest low fares long haul carrier.
It has achieved exceptional growth over five years
and cemented its lowest fares market position
through its direct sales model, self-service and
user-pays offerings, simplified fleet, and lean and
accountable culture.
Jetstar has focused heavily on regional
expansion within the Asia Pacific region over the
past year, increasing its strategic holdings in
affiliated businesses – Jetstar Asia in Singapore
and Jetstar Pacific in Vietnam – and launching
New Zealand domestic and additional
trans-Tasman services.
As a result, the Jetstar brands – including
Jetstar Asia and Jetstar Pacific – grew strongly in
2008/09, carrying 13.4 million passengers to 50
destinations in Australia, New Zealand, Asia and
to Honolulu. Jetstar achieved an 18.8 per cent
increase in revenues to $1.9 billion.
Domestic and Short Haul International
Jetstar continued to expand its Australian
domestic and short haul international business,
despite weaker economic conditions. Growth in
Available Seat Kilometres remained steady
at 4.1 per cent for the domestic business and grew
strongly by 100 per cent for the short haul
international business.
With the delay of the B787 program, Jetstar
developed a strategy of short haul international
expansion using its A320 fleet. Market growth
focused primarily on driving domestic traffic to
Jetstar’s international gateway cities – Darwin,
Perth, Gold Coast and Cairns – and onwards to
Jetstar’s developing pan-Asian network.
The Darwin hub, developed as the primary
A320 link between Australia and Asia, is now
served by 69 international and domestic flights
per week to Adelaide, Brisbane, Cairns,
Melbourne and Sydney; with all but the Adelaide
services connecting directly on to international
services to Denpasar, Ho Chi Minh City
and Singapore.
Jetstar has also grown its Perth operations
with flights from Adelaide and Melbourne,
a new Cairns service and international services
to Denpasar, Jakarta and Singapore.
Linking Cairns and the Gold Coast three times
per week has increased Jetstar’s ability to combine
international and domestic flights for visitors
from Japan to Queensland and to reinforce its
Gold Coast hub, where Jetstar now operates over
130 flights per week.
In June 2009, Jetstar opened a passenger
lounge at Gold Coast Airport. The lounge offers
internet access, a selection of food and beverages,
children’s play area and a cinema. Access to the
lounge is complimentary for StarClass passengers
on international services and fee-based for other
eligible customers.
Jetstar’s narrow-body fleet increased from
30 to 37 A320/A321 aircraft over the course of
2008/09. The A321, with 37 more seats and five
per cent lower operating costs compared to the
A320, provides an effective vehicle for increasing
capacity on high density domestic routes.
Low fare sales through jetstar.com and the
launch of Jetstar’s enhanced ‘Price Beat
Guarantee’ in November 2008 reinforced Jetstar’s
position as the low fares leader.
In 2008/09, Jetstar continued to link its low
fares sales activity to the Jetmail direct mail
database. By targeting low fare promotions such
as the weekly ‘Friday Fare Frenzy’, the ‘Fifth
Birthday Sale’ and others, Jetstar’s Jetmail
database has become a powerful advertising tool.
Given the importance of ancillary revenue
streams to Jetstar’s profitability, product
development has again been a key focus for
2008/09. In addition to the continued success of
the ‘JetSaver Light’ product, with nearly 30 per
cent of Jetstar passengers now travelling without
checked baggage, Jetstar has launched ‘Extra Leg
Room’ and ‘Spare Seat’ products.
Jetstar became the first airline in Australia to
use self-tagging technology for baggage check-in
at selected airports across its Australian domestic
network. In combination with the roll out of
check-in kiosks in nine Australian ports, the new
technology is designed to save time and reduce
queues, effectively lowering costs and driving
improved customer satisfaction. More than
50 per cent of Jetstar’s domestic passengers now
check-in at kiosks or online, and planning for
further expansion of these services is underway.
Jetstar Key Figures 2008/09 2007/08
Revenue ($m) 1,851 1,564
Underlying Earnings
Before Interest and Tax ($m) 107 102
Earnings Before Interest
and Tax ($m) 126 102
Passengers (millions) 10.7 9.2
Employees*(Full Time Equivalent) 3,010 2,735
*Does not include employees of Jetstar Pacific or contracted
support operations across the Jetstar brands.