World

Jetstar to boost presence
in Singapore

Budget airline Jetstar is taking key steps to firmly establish Singapore as its main business and operations hub.

It shifted its information technology centre from Melbourne to Singapore a year ago, and its global sales team will make a similar move in the coming weeks, group chief executive officer Bruce Buchanan said.

Jetstar, which operates three carriers – in Australia, Singapore and Vietnam – is also finalizing plans to build its own aircraft hangar at Changi Airport.

Buchanan knows that aircraft engineers, technicians and other industry stakeholders in Australia are not going to be happy with the plans. For some time now, they have been complaining about Jetstar's Asian focus, which they say has resulted in jobs leaving the country.

It is a "sensitive political issue", Buchanan told The Straits Times in an interview yesterday.

And he insisted the airline is still very much committed to Australia, where two-thirds of its total global workforce of about 7,000 people are based.

Citing an example, he said that when the new hangar in Singapore is up and running, possibly by 2014, the airline's current facility in Newcastle, Australia will not close, but will continue to maintain Jetstar's aircraft.

But while Jetstar will remain in Australia, he said, the reality is that Asia is where the growth is – and to cash in on the boom in the aviation industry, Jetstar's centre of gravity must be in the region. "It is a natural evolution," Buchanan said. "We can't be a Western or Australian-centric company if we want to grow and achieve success."

The opportunities in Asia are mind- boggling, he said. In China alone, there are nearly 100 cities which Jetstar could consider as destinations in the next three to five years. Currently, it serves 10 Chinese destinations from its Singapore hub.

Jetstar has big plans in the coming years, Buchanan revealed.

Next year, it will take delivery of its first few Boeing 787 Dreamliners, and while plans have not been confirmed, it is possible that at least one of them could be based in Singapore.

The new hangar planned for Changi will be able to service both single-aisle and wide-bodied aircraft like the Airbus 330 and, eventually, the B-787.

Several options are being considered for the new facility, Buchanan said. Jetstar could decide to build and operate it on its own, or work with a partner – possibly Shaeco, a Singapore subsidiary of a Hong Kong aircraft repair and maintenance firm, or ST Aerospace.

Both firms currently maintain Jetstar's fleet in Singapore.

The airline's decision to firmly plant its flag in Singapore is an important feather in the cap for Singapore's aviation sector, industry watchers said.

Buchanan did not say how much will be invested in Singapore in the coming years, but experts reckon it will be more than half a billion dollars, including the cost of the new aircraft to be based here.

The airline currently has about 1,000 employees in Singapore and 20 planes parked at Changi Airport.

Headcount is expected to grow by up to 200 a year over the next few years.

A spokesman for Changi Airport Group, Ivan Tan, said: "We look forward to working with the airline to enhance its hub operations at Changi Airport." (mtq)

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