Qantas has announced it will establish a new low-cost carrier based in Hong Kong in a 50-50 joint venture with China Eastern Airlines.
The ABC reports Jetstar Hong Kong is expected to begin service next year, pending approval from regulators.
Qantas says it will be the first discount carrier based in Hong Kong.
The airline, which will launch with a fleet of three Airbus A320s, will fly short-haul routes within Asia in greater China, Japan, South Korea and southeast Asia.
Jetstar chief executive Bruce Buchanan says Jetstar Hong Kong fares will be half the price of existing full-service airlines in the region.