Vietnam Airlines CEO, Dr. Pham Ngoc Minh with Jetstar CEO, Bruce Buchanan

Jetstar Pacific, Qantas Group’s low cost-carrier has a new majority shareholder, in the form of Vietnam Airlines.

Vietnam Airlines signed a partnership agreement on Tuesday to secure a 70 percent, majority share from Vietnamese State Capital Investment Corporation (SCIC) in the Vietnam-based low cost carrier.

Qantas CEO, Alan Joyce outlined the potential for growth and development through the dual brand partnership.

“We are confident this partnership between a low cost carrier and a full service airline in Vietnam can replicate the success of our Qantas and Jetstar strategy in Australia,” Mr Joyce said.

Jetstar Pacific will benefit from an estimated AU$25 million worth of injected capital and a further AU$7.5 million from the Qantas Group itself.

These investments will aid in strengthening the carrier’s fleet, replacing the current Boeing 737s with all new A320 aircraft from mid-2012.

Jetstar Chief Executive, Bruce Buchanan expressed interest in new opportunities.

“Across Asia we are seeing the positive impacts of introducing a new generation of customers to air travel, including Vietnam where the penetration of low cost carriers is still relatively low.

“The strength of our low cost model and the tremendous potential for growth provide a unique opportunity for Jetstar in Vietnam. Our partnership with Vietnam Airlines will help develop this,” Mr Buchanan said.

According to International Air Transport Association (IATA), Vietnam will become the world’s second fastest growing aviation market for domestic passengers by 2014.