Qantas unveils discount strategy
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Qantas CEO Geoff Dixon calls Avalon a "perfect gateway" for leisure travelers.
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SYDNEY, Australia (CNN) -- Jetstar, the new discount carrier set up by Australia's biggest airline Qantas, is to operate some services from a secondary airport outside Melbourne.
Qantas announced the route structure and operating strategy for Jetstar Wednesday, ahead of the launch of services on May 25.
To keep costs down in its battle with discount rival Virgin Blue, Qantas said Jetstar will fly some of its services to Sydney and Brisbane from Avalon, a privately owned airport 55 kilometers (33 miles) west of Melbourne.
Qantas said Jetstar would fly from Melbourne, Sydney and Brisbane to eastern Australia destinations, including leisure gateways such as the Gold and Sunshine Coasts, Cairns, the Barrier Reef and Tasmania.
Along with 246 flights a week in and out of Melbourne's main Tullamarine airport, Jetstar will also operate 70 services to and from Avalon.
Qantas CEO Geoff Dixon said Avalon was a "perfect gateway" for leisure visitors to Victoria.
Jetstar is following a well-worn path with its choice of a smaller, cheaper alternative to Melbourne's main international and domestic airport. U.S. and European discount carriers frequently use secondary airports to keep costs down.
Avalon is controlled by the Linfox group headed by transport magnate Lindsay Fox.
Fox, who was involved in an unsuccessful attempt to buy Qantas rival Ansett Airlines after it collapsed in late 2001, said Wednesday that Linfox had developed Avalon in recent years as a center for pilot training, aircraft maintenance and international air freight.
"Moving into passenger flights will complement our existing activities," he said.
There is speculation that Qantas may seek a secondary airport for some of Jetstar's Sydney services later on.
Earlier this month Qantas announced first-half net profit for 2003-04 of A$357.8 million ($283 million) on the back of cost savings, strong domestic demand and a recovery in international travel. (Full story)
