Jetstar inks engine deal
Singapore - Jetstar has signed a US$3.5 billion deal with aircraft engine maker International Aero Engines (IAE).
The deal is split in two parts: The first is a US41.5 billion deal to buy a new generation of aircraft engines. These will power Jetstar's new fleet of 50 Airbus A320 family aircraft, with options to purchase rights on up to 40 more aircraft.
The second is a US$2 billion long term services agreement with IAE covering the new engines.
The aircraft will be distributed amongst the Jetstar fleet based in Australia and New Zealand, as well as Jetstar Asia/Valuair of Singapore and Jetstar Pacific, local reports said.
Jetstar has also entered a strategic partnership with the Changi Airport Group (CAG) to make Singapore Changi Airport its largest air hub in Asia for both short and long haul operations.
The three-year agreement will see Jetstar operating its highest number of services and base its largest number of A320-family aircraft in Asia at Changi. It also commits to introduce long haul services using wide body aircraft out of Singapore, as well as increasing existing flight frequencies and offer more destinations from Singapore. The carrier said it aims to growth the percentage of transit and transfer traffic through CHangi among its passengers.
CAG is expected to support Jetstar's growth at Changi Airport via initiatives under the Changi Airport Group introduced on 1 January this year. These incentives will enable Jetstar to lower its cost of operations at Changi, the company said in a release. CAG is also expected to work closely with Jetstar to explore route opportunities to grow its traffic out of Changi and improve ground operations to support Jetstar's operational needs.
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