Qantas to Close Jetstar Asia, Cancels 16 Routes from Singapore

SYDNEY- Qantas Group (QF) has officially declared the planned closure of its low-cost subsidiary, Jetstar Asia (3K), based in Singapore, effective July 31, 2025. This decision is part of the Group’s broader strategy for fleet renewal and capital reallocation.

The closure will disrupt 16 intra-Asia routes originating from Singapore Changi Airport (SIN). However, services provided by Jetstar Airways (JQ) or Jetstar Japan (GK) will remain unaffected.

Jetstar Asia has been a prominent entity in Southeast Asia’s budget travel sector for over two decades. Its operations are being halted in response to escalating supplier costs—some soaring by as much as 200%—and intensified competition in the region.

Despite a history of dependable service, the airline struggled to achieve the profitability levels consistent with Qantas Group’s primary operations in Australia and New Zealand.

The airline is projected to encounter an underlying EBIT loss of $35 million in FY25. The operational winding down is anticipated to take place over seven weeks, culminating on July 31, 2025.

Customers impacted by this transition will have access to full refunds or options for rebooking with alternative carriers, while employees are offered redundancy support and assistance for job placement within the Qantas Group or other regional airlines.

Redeployment of Resources

This closure facilitates the Qantas Group in reallocating up to $500 million in capital. Thirteen Airbus A320 aircraft from Jetstar Asia will transition to Jetstar Airways and QantasLink operations in Australia and New Zealand. The redeployment aims to:

• Boost domestic capacity with competitive fare offerings.
• Substitute older leased aircraft to lower operational expenses.
• Support Qantas’ regional services in Western Australia, particularly within the resource sector.

This reinvestment is aligned with Qantas’ larger fleet modernization initiatives, which include the introduction of the Airbus A321XLR this month and the Airbus A350-1000ULR scheduled under Project Sunrise for 2026.

The total anticipated financial repercussions stemming from this closure are around $175 million, encapsulating redundancy and restructuring costs, as well as non-cash foreign currency translation losses. Approximately $160 million is expected to be direct cash expenses, chiefly occurring in FY26.

Nevertheless, Qantas anticipates a partial counterbalance to these costs through increased working capital associated with expanded operations at Jetstar Airways and related tax adjustments.

Updated Group Capacity and Outlook

As outlined in the latest guidance from Qantas Group capacity:

• Domestic Group growth is expected to remain modest at +1% for FY25, increasing to +5% in the first quarter of FY26.
• International Group reflects a stronger trajectory, projected at +12% growth in FY25.
• Jetstar International is set to lead the international growth segment with a +25% increase in capacity for FY25.
• The overall group capacity is anticipated to grow by +8% in FY25, slightly softening to +5% in the first quarter of FY26.

Temporary setbacks have included Cyclone Alfred, which adversely affected Queensland routes and decreased Group Domestic earnings by $30 million, as well as industrial actions impacting Qantas’ wet lease capacity with Finnair.

Despite Jetstar Asia’s closure, Singapore (SIN) continues to be recognized as Qantas Group’s third-largest international airport. The Group will maintain interline and codeshare agreements with nearly 20 Asian carriers from this hub to preserve regional connectivity.

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