Jetstar Australia's Philippine Dilemma

 Good Times are over!

10 December 2013

Darwin — JETSTAR Australia has announced that it will dump flights to Manila from Darwin and Manila Tokyo beginning March 31 next year due to "increased capacity and competition" from foreign carriers, particularly Philippine Airlines.

Passengers in the Northern territory wishing to travel to Manila and Tokyo on Jetstar would now have to fly to Singapore and connect with a Jetstar Asia service to Japan and the Philippine capital.

Jetstar and Philippine Airlines (PAL) operates four weekly flights between Darwin and Manila with the former enjoying fifth freedom traffic rights to Japan, and is flying to Tokyo. 

But Philippine Airlines' decision to launch flights to Darwin last June onwards to Brisbane and Perth is understood to have been a factor in their decision as they've been operating previous monopoly on this lucrative but marginal routes.

PAL Left Perth but stayed in Brisbane and lately upgraded capacity between Manila, Darwin and Brisbane with much bigger A321 jet beginning November 16 suggesting a growing traffic on a similar frequency after the legacy carrier dump prices on its LCC competitor.

Jetstar's departure would allow PAL to fly daily to Darwin and re-introduce Perth to its growing network.

Jetstar right to Japan would further be diluted upon the expansion of PAL flights to Tokyo this month adding 100 percent of existing capacity beginning December 15 from PAL alone.

Philippine bilateral rights to Japan has been constricted for eight years before they were expanded in September allowing the Philippines to mount more flights to Japan. The restriction did not affect the fifth freedom rights granted to Australia.

Jetstar will also cut the number of Darwin-Denpasar flights from eight per week to daily, and between Darwin and Brisbane from nine to seven per week, while the number of flights from Darwin and Singapore will be reduced from nine per week to daily flights.

Qantas says increased competition in Darwin and Manila has contributed to its problem as it seeks to cut costs by $2 billion over the next three years and consider restructuring the company to address problems contributing to a first-half underlying pre-tax loss of up to $300 million. 

Spokesman Stephen Moynihan said the decision to drop Manila flights is because of Jetstar shifting its three Airbus A320 aircraft stationed at Darwin to Adelaide to establish a new cabin crew and pilot base in the South Australian capital. He said the move will see 93 flight attendant and pilot jobs cut from Darwin, but 120 new jobs created in Adelaide.