Qantas Group has announced the closure of its Singapore-based low-cost airline, Jetstar Asia, as part of a strategic restructuring initiative. The closure is anticipated to recycle up to $500 million in capital to support Qantas' fleet renewal program.

The decision will see 13 Jetstar Asia Airbus A320 aircraft redeployed to Australia and New Zealand. This move is expected to create more local jobs and offer more low fares in these regions. However, the closure will impact 16 intra-Asia routes, although Jetstar Airways and Jetstar Japan services into Asia will remain unchanged.

Jetstar Asia has faced significant challenges due to rising supplier costs, high airport fees, and intensified competition. These factors have contributed to an expected $35 million EBIT loss for the airline in this financial year. The airline will operate a reduced schedule for the next seven weeks, with its final day of operation set for 31 July 2025.

The closure will not affect Jetstar Airways' domestic and international operations in Australia and New Zealand or Jetstar Japan. Customers with existing bookings on cancelled Jetstar Asia flights will be offered full refunds and possible reaccommodation on other airlines.

Affected Jetstar Asia employees will receive redundancy benefits and employment support services. Qantas is also working to find job opportunities for these employees across the Group and with other airlines in the region.

Singapore remains a critical hub for Qantas, being its third-largest international airport. The closure will result in one-off redundancy and restructuring costs, with a combined impact estimated at approximately $175 million. The direct pre-tax cash impact of the closure is approximately $160 million, predominantly in FY26.

The 13 A320 aircraft from Jetstar Asia will replace leased aircraft in Jetstar Airways' domestic operation and support fleet renewal in Qantas' regional operations. Qantas is undertaking a significant fleet renewal program with nearly 200 firm aircraft orders.

The closure of Jetstar Asia will unlock capital to be recycled into Qantas' core businesses and strategic growth initiatives like Project Sunrise. Qantas Group CEO Vanessa Hudson highlighted the impact of increased supplier costs on Jetstar Asia's cost base.

"Jetstar Asia has been a pioneering force in the Asian aviation market for more than 20 years, making air travel accessible to millions of customers across Southeast Asia," said Hudson.

"We are incredibly proud of the Jetstar Asia team and the work they have done to deliver low fares, strong operational performance and exceptional customer service. This is a very tough day for them. Despite their best efforts, we have seen some of Jetstar Asia’s supplier costs increase by up to 200 per cent, which has materially changed its cost base," stated Hudson.

"I want to sincerely thank and acknowledge our incredible Jetstar Asia team who should be very proud of the impact they have had on aviation in the region over the past two decades," Hudson added.

"We are currently undertaking the most ambitious fleet renewal program in our history, with almost 200 firm aircraft orders and hundreds of millions of dollars being invested into our existing fleet," Hudson noted.

"We're making disciplined decisions which recycle capital across our business and prioritise it to stronger performing segments as well as strategic growth initiatives like Project Sunrise," Hudson concluded.