TOKYO/SYDNEY – Qantas Group of Australia will sell its entire stake in Jetstar Japan, a low-cost carrier (LCC) that it co-owns with Japan Airlines (JAL), the airlines said Tuesday. JAL will review the shareholding structure of the joint venture following the change.

JAL announced the Development Bank of Japan will become a new shareholder in the joint venture. The shareholders are considering changing the name of Jetstar in favor of a new brand to be launched by June 2027.

Jetstar Japan was established in September 2011. JAL currently holds a 50.0% stake in the venture, while Qantas owns 33.3% and Tokyo Century owns 16.7%. The carrier launched domestic services in July 2012 and international flights in February 2015.

Jetstar is facing headwinds. In Japan’s domestic market, demand for full-service business travel has been declining, while the yen’s decline has raised foreign currency-denominated costs, hurting profitability. Jetstar Japan, despite being an LCC, relies heavily on domestic routes and has struggled to generate stable earnings.

The shareholders aim to expand the airline’s international routes to cater to rising demand from overseas tourists.

Qantas has also been reviewing its LCC strategy. In July 2025, it halted the operations of Jetstar Asia, based in Singapore. The company has pulled out of unprofitable LCC businesses, shifting its focus to more lucrative long-haul routes with a higher proportion of premium seats, such as direct flights from Australia to New York, dubbed Project Sunrise.

Qantas operates a separate carrier, Jetstar Airways, as a wholly owned subsidiary. It mainly provides lower-fare options on both Australian domestic and international routes.

Jetstar Japan is Japan’s second major domestic LCC, following Peach Aviation, which operates under ANA Holdings.