Friday, April 18, 2014   




Jetstar gives the lowdown

Staff reporter

Thursday, September 12, 2013


Budget carrier Jetstar Hong Kong Airways has sparked strong interest from travel agencies, keen to sell cheaper tickets and offer more packaged tours.

"Budget airlines aren't confined to individual travelers but group tours too," Jetstar Hong Kong chairwoman Pansy Ho Chiu-king, said at a luncheon yesterday.

Ho, also managing director of Shun Tak Holdings, added travelers would rather save on flights and hotels and spend on other items, industry findings show. "We should offer more choices to customers. I think most people hate taking a shuttle bus before boarding a plane but they have to be prepared for that with Jetstar, which is going to be 50 percent cheaper [than conventional airlines]."

She said passengers have different expectations depending on how much they are paying for the fare. "Our existence will prove the value of the biggest operator, which they will distinguish from us."

Jetstar Hong Kong hopes to start operating this year but it is still waiting for a license from the government. Chief executive Edward Lau Chung- wai said it can start operating immediately as it has acquired 18 Airbus A320 and has hired enough staff in Hong Kong.

Jetstar's application for the license has been gazetted but Cathay Pacific Airways, Hong Kong Airlines and HK Express have filed formal objections. Cathay said Jetstar does not meet Basic Law Article 134 that its principal place of business must be Hong Kong as it is a franchise of Jetstar, Australia. Both Hong Kon
g Airlines and HK Express are controlled by Hainan Airlines and have investments from Ho's father Stanley Ho Hung-sun.

HK Express is to outline its latest business plan as a budget airline today.

Pansy Ho yesterday said the two airlines are her father's private investment and do not operate under Shun Tak.

Lau said Jetstar Hong Kong will continue to make procurements via Australia to save costs. But that does not mean it is an Australian operation. He reiterated he himself is a local who reports to a board of seven directors, which only has two non-locals. They are representatives of the other two shareholders, China Eastern Airlines and Qantas Group.

"Jetstar Hong Kong will offer point- to-point five-hour flight in Asia and China. Ninety percent of our passengers will spend some time in the SAR bringing economic benefit, which could amount to HK$8 billion with five million people we target to carry each year."

Pansy Ho said a thorough study of the business model has been made. "The time our aircraft will spend on the ground will be two times less than that of traditional carriers. Parking fees in Hong Kong airport are high but not unaffordable," Lau added.

Both Ho and Lau stressed Jetstar Hong Kong will be better at using existing resources of the airport, which still has capacity to spare during off- peak hours.

Local airline operators must create a bigger customer base before the Hong Kong-Zhuhai-Macau bridge is completed in 2017, when people can have easy access to other large airports in the Pearl River Delta, Ho said.


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