Vietnamese low-cost airline Jetstar Pacific is returning to its former name Pacific Airlines after Qantas has confirmed that it will give up its minority stake in the airline and hand over full control to the co-owner Vietnam Airlines.
Gareth Evans, managing director of Qantas budget division Jetstar, said Monday the group will drop its 30 percent stake in Jetstar Pacific “in the coming months” while pending regulatory approvals to “focus on our other airlines “.
“We have had discussions with Vietnam Airlines for some time about the challenges for Jetstar Pacific, which have obviously been exacerbated by the COVID crisis,” Evans said in a statement.
In a statement, Vietnam Airlines confirmed the carrier will return to its original brand name, Pacific Airlines.
The re-branded airline will feature a new logo and livery inspired by Vietnam Airlines’ brand colours and design.
The airline will also change its reservation system from Navitaire to Sabre, to allow the low-cost carrier to streamline its bookings, network and customer functions.
Vietnam Airlines executive vice president and Pacific Airlines chairman, Trinh Hong Quang, said the change would unlock economies of scale and help the industry to embark on a post Covid-19 recovery.
“Low-cost carriers will play a certain role in supporting the return of travel as restrictions ease, and by streamlining functions, Pacific Airlines can remain competitive, inherit many of the efficiencies of Vietnam Airlines and continue to offer the low fares our customers expect.”
He added: “We are optimistic that the dual brand strategy will leverage the brand and resources of Vietnam Airlines, and by undergoing innovation and improvisation, we will continue to see Vietnam Airlines Group maintain its position of leadership in the Vietnamese domestic market now and into the future.”
Gareth Evans, chief executive of Qantas’ budget division Jetstar, said the group would offload its 30 per cent stake in Jetstar Pacific “in the coming months”, pending regulatory approvals, so it can “focus on our other airlines”.
He added: “With a highly competitive domestic market in Vietnam and the disruption caused by the coronavirus, the time is right to take advantage of the strength and scale of Vietnam Airlines in its home market.
“Streamlining customer and booking functions will enable further cost savings and position the airline for a stronger future as international travel restrictions ease.”
Jetstar Pacific lost money in most of the 13 (since 2007) years that Qantas has invested in the airline when it paid the Vietnamese government $ 30 million in 2007 for a stake in the local airline Pacific Airlines.
The Qantas Group wanted to expand its presence in the Asia Pacific region by investing in joint ventures such as Jetstar Pacific such as Jetstar Asia in Singapore with 49% and Jetstar Japan with a third of Qantas.
Qantas and China Eastern had been thinking about Jetstar Hong Kong’s idea for years, but remain so until now because the Chinese aviation authorities have rejected their license application.
Duong Tri Thanh, CEO of Vietnam Airlines, said in 2019 that Jetstar Pacific is an key part of the airline’s strategy in dealing with competitors such as VietJet Air in the highly competitive Vietnamese domestic market.
(Source – BTN)
Have you read? – China To Launch New Airline Despite Travel Downturn Amid Coronavirus