Jetstar Essay

1081 Words5 Pages
Executive Summary
Jetstar Airways is an Australia low-cost carrier airline based in Melbourne, Australia. It is a wholly owned subsidiary of the Qantas Group. Qantas established Jetstar in 2003 as a response to main competitor airline Virgin Australia (formerly known as Virgin Blue).
Despite its low cost, Jetstar operates an extensive domestic network and is the world’s largest long-haul low cost carrier. Jetstar operates to destinations in Asia the Pacific Ocean, with future plans of expanding their services throughout Europe.
Jetstar currently offers a limited number of connecting services without through baggage checking, and it became the first Australia airline to allow customers to select their seat upon booking. The airline,
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Jetstar shares its parent's strong competition with Australia's biggest low-cost carrier Virgin Australia. Domestic travel accounts for 75% of the airline industry revenue in Australia (Taylor Woodings, 2011)
Market Potential
The market is currently in the decline stage. From 2007, Australian domestic air travel started with buoyant demand for air travel and high fuel prices boosted ticket prices. However, domestic airlines faced major hurdles when the global economic downturn hit. Higher unemployment and a decline in discretionary income slowed demand for air travel in Australia. In particular, business travellers abandon air travel in favour of teleconferences and e-mail. Demand also weakened as Australians have started to plan travelling internationally.
Market Structure
The domestic flights market can be considered as an oligopoly. The 3 main companies that have the most market share are Virgin Australia, Jetstar and Tiger Airways Australia.
Trends
Demographic:
Australia is an underpopulated country and is also an ageing. However, over the years the numbers of migrants have been increasing. With the rising number of migrants, there will most likely be an increase in the number of domestic flights demanded since they may want to visit other cities

Economic:
Australia currently has the strongest economy in the

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