Qantas Shutters Asian Subsidiary to Fund Fleet Expansion
Good morning! It's Thursday, 12 June. Welcome to INSIDE AUSTRALIA, where you'll find all the latest business and financial news, plus our take on what's going on around the world.
In today's news from Australia, Qantas has ceased operations of its subsidiary Jetstar Asia, citing increasing costs as the primary reason. Meanwhile, a collaborative agreement has been reached between the United States and China concerning the relaxation of export controls, following trade negotiations in London.
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In today’s email:
Qantas Shutters Asian Subsidiary to Fund Fleet Expansion
Australia Sets August Productivity Summit Amid Reform Pressure
Millions Face Missing Junk Insurance Refunds as Deadline Looms
NAB Staff Confront Scammer Live, Save Customer $50,000
Today's reading time is 7 minutes. - Miko Santos
MARKET CLOSE: 11 JUNE 25
The Aussie market cracked a fresh record high intra-day on news of a China-US trade truce.
Data is provided by CommSec. Stock data as of At close 011/06 (AEST)
Qantas Shutters Asian Subsidiary to Fund Fleet Expansion
What happened: Qantas Group announced today it will close Singapore-based subsidiary Jetstar Asia on July 31, 2025, after the low-cost carrier posted a projected $35 million underlying EBIT loss this financial year. The closure, decided jointly with majority shareholder Westbrook Investments, affects 16 intra-Asia routes and releases 13 Airbus A320 aircraft for redeployment to Australia and New Zealand operations.
Why it matters: The shutdown unlocks up to $500 million in capital that Qantas will redirect toward its historic fleet renewal program, which includes nearly 200 firm aircraft orders. Passengers holding bookings on cancelled Jetstar Asia flights will receive full refunds, while affected employees face redundancy (though Qantas promises employment support and potential positions within the broader group). The 13 freed aircraft will create more than 100 local jobs in Australia and New Zealand while replacing costlier leased planes in Jetstar Airways' domestic operations.
Zoom out: Jetstar Asia's demise reflects intensifying pressure across Asia's low-cost carrier segment, where supplier costs have increased up to 200 percent according to Qantas CEO Vanessa Hudson. The closure aligns with Qantas's strategic pivot toward higher-performing core markets as it executes an ambitious expansion plan including the upcoming Airbus A321XLR delivery this month and Project Sunrise A350-1000ULR aircraft in 2026. Singapore remains critical to Qantas as its third-largest international hub, with service continuing through codeshare partnerships and Jetstar Airways' unchanged Australia-Asia routes.
Bottom line: Qantas is trading short-term disruption for long-term positioning, cutting losses in a margin-compressed Asian market to fuel growth in stronger home markets during aviation's post-pandemic transformation.
BIG PICTURE
➡️ IM Motors Launches Tesla Rival Electric Cars in Australia: IM5 Sedan and IM6 SUV From $60,990. IM Motors, the luxury electric vehicle brand owned by MG, has launched pre-orders in Australia for their Tesla-rivaling IM5 sedan and IM6 SUV, both starting at $60,990 drive-away with delivery expected in 12 weeks.
➡️ Young Australian Woman Shocks TikTok After Revealing $19,000 Afterpay Debt in Two Years. A 21-year-old Tasmanian woman named Shyneka Long went viral on TikTok after discovering she spent $19,000 on Afterpay purchases over two years, sparking conversations about buy now, pay later addiction as other users revealed even higher debts reaching over $100,000.
➡️ Australia's $10 Billion Mining Diesel Subsidy Under Fire as Costs Set to Rise. Australian taxpayers currently subsidize over $10 billion annually in diesel fuel costs for mining companies through a tax credit scheme that critics argue undermines renewable energy transition and wastes public money that could fund essential services.
Australia Sets August Productivity Summit Amid Reform Pressure
What happened: Prime Minister Anthony Albanese announced Australia will convene a national productivity summit in August, responding to mounting pressure from Independent MP Allegra Spender and business leaders for structural reforms to address chronic efficiency problems. The summit represents the government's most significant attempt to tackle productivity constraints that have hampered economic growth for decades, with businesses currently waiting 13-18 months for visa approvals and up to 200 days for local development applications.
Why it matters: Australia's productivity crisis is strangling business operations and economic growth at every level of government. The delays aren't just bureaucratic inconveniences—they're preventing companies from scaling, hiring, and investing at the pace needed to compete globally. When businesses can't get basic approvals processed efficiently, it cascades into slower job creation, reduced innovation, and ultimately lower living standards for workers whose wage growth depends on productivity improvements.
Zoom out: This productivity push comes as Australia faces a critical economic inflection point. The country lacks a comprehensive AI strategy while competitors like South Korea have had frameworks in place for years, leaving Australian businesses navigating technological transformation without government guidance. Meanwhile, the tax system remains largely unchanged since the Henry Review over a decade ago, despite mounting evidence that capital gains and GST structures are hampering business investment. The summit timing suggests Labor recognizes it has a unique political window—with its substantial parliamentary majority—to implement reforms that previous governments avoided for two decades.
Bottom line: The August summit will test whether Australia's government can move beyond talking about productivity to actually implementing the difficult reforms around taxation, regulation, and AI strategy that businesses desperately need. Success requires coordinated action across federal, state, and local levels—something that has proven politically impossible for every administration since the early 2000s.
Millions Face Missing Junk Insurance Refunds as Deadline Looms
What happened: The Australian Financial Complaints Authority (AFCA) has set a June 30 deadline for consumers to claim refunds on junk insurance products sold before July 2019, with an estimated 5 million Australians potentially eligible for compensation worth billions of dollars. Banks and insurers sold over 10 million add-on insurance policies over 29 years, paying out as little as 11 cents per dollar while generating up to $10 billion in revenue, according to financial refund service Claimo founder Nathan Mortlock.
Why it matters: Since the banking royal commission exposed these practices in 2019, only $270 million has been refunded to customers who were mis-sold consumer credit insurance and car-yard add-ons—leaving potentially billions unclaimed. Claimo has processed 70,000 cases worth $67 million, with individual payouts ranging from thousands to over $20,000. The surge of 50,000 new enquiries since November suggests widespread ignorance of entitlements, meaning legitimate claimants could lose their right to compensation simply due to lack of awareness.
Zoom out: Australia's approach contrasts sharply with Britain's handling of a similar scandal, where regulators forced financial institutions to repay £48 billion ($99.5 billion) to customers through high-profile awareness campaigns including Arnold Schwarzenegger's "Terminator" advertisements. The UK gave consumers nearly a decade to claim, while Australia's deadline arrives with minimal fanfare despite ASIC identifying the problem as early as 2011. Consumer advocates argue the burden should be on banks to identify affected customers rather than forcing consumers to prove they weren't previously aware of their rights.
Bottom line: Australia's hands-off approach to consumer redress means millions of victims of documented financial misconduct may forfeit billions in legitimate compensation due to inadequate public awareness—a policy choice that benefits the institutions that caused the harm.
NAB Staff Confront Scammer Live, Save Customer $50,000
What happened: NAB staff at an East Maitland branch intercepted a live remote access scam targeting an 84-year-old customer attempting to transfer $50,000 to criminals posing as tech support representatives. Customer advisor Tiffany Bailey identified red flags when the victim requested her daily limit be increased while on a suspicious phone call, leading branch manager Vanessa Kruger to directly confront the scammer and terminate the fraud attempt.
Why it matters: The incident demonstrates how frontline banking staff are becoming the last line of defense against increasingly sophisticated remote access scams that combine phone manipulation, computer hijacking, and social engineering. The criminals had gained remote access to the victim's computer, generated fake debt images, and coached her on what to tell bank staff—illustrating the elaborate preparation scammers now deploy against vulnerable customers. Without intervention, the retiree would have faced complete financial devastation.
Zoom out: Remote access scams represent a growing threat vector where criminals exploit both technological vulnerabilities and psychological manipulation, particularly targeting elderly customers with complex scenarios involving fake tech support, manufactured urgency, and fabricated debts. NAB's response reflects the banking sector's shift toward proactive scam detection through staff training and real-time intervention protocols, with Group Investigations Executive Chris Sheehan positioning Australia's "ecosystem approach" as world-leading despite acknowledging scam prevention resembles "playing whack-a-mole."
Bottom line: Banks are increasingly positioning branch staff as human circuit breakers against digital fraud, but the sophistication of remote access scams suggests traditional customer education alone won't solve the problem.
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