THE WASHINGTON POST: Ex-Qantas executive Peter Kelly in talks with US backer to fund new airline Zinc
The man who helped Qantas start its own budget airline is now seeking to secure one large financial backer for his proposed airline.
A former Qantas Airways Ltd. executive trying to launch a new low-cost airline in Australia is in talks with a potential cornerstone investor in the US as part of a plan to raise more than A$250 million ($174 million).
Peter Kelly, who helped Qantas start its own budget carrier Jetstar in 2004, said in an interview this week that the financing discussions are in their early stages. He’s seeking to secure one large financial backer for his proposed airline, which is named Zinc, as well as four to five smaller investors.
Zinc aims to start flights in early 2028 and is one of several potential new entrants in Australia including Koala Airlines Pty.
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The vast distances between major cities in Australia make air travel a necessity, helping deliver bumper profit margins for dominant domestic carriers.
Even if Mr Kelly’s fundraising efforts succeed, Zinc must defy a history of failure among airline startups in Australia, where Qantas and Virgin Australia Holdings Ltd. hold a duopoly.
Recent failures include regional Australian airline Rex, which made an ill-fated entry into the mainstream capital city market.
New entrant Bonza also collapsed in 2024 after struggling to fill planes on untested routes as it tried to avoid head-to-head competition with Qantas.
Mr Kelly said the catalyst for the creation of Zinc is the new airport in western Sydney, which opens to passenger flights in October. Previous new airlines in Australia had no chance of succeeding because of the lack of available landing and takeoff slots at Sydney’s main airport, the country’s primary aviation hub, Mr Kelly said.
The huge capacity at Western Sydney International Airport, which will have no overnight flight curfew, will allow airlines to operate with fewer restrictions, Mr Kelly said.
The airport says it will initially be able to handle as many as 10 million passengers each year, with scope to increase the number to more than 80 million in 2060.
“We have to try and overcome this myth that the Australian domestic market is impenetrable, that it’s sewn up by two companies,” Mr Kelly said in the interview in Adelaide, where he was attending an aviation conference.
Mr Kelly, who is based in Melbourne, said he spent more than a decade overseas as a consultant, mostly based in Cyprus and the UK, before returning to Australia about 18 months ago. He said he carried out projects for airlines including EasyJet Plc, and is working on Zinc with two other individuals.
If he can secure funding for Zinc, Mr Kelly plans to apply next year for an air operator’s certificate from Australia’s civil aviation regulator.
He said he has already lined up a leadership team for Zinc, including a chief executive officer, a chief financial officer and a chief commercial officer. He declined to name them.
“Once we get the money, that’s when everything kicks off,” he said. “Until you get that money, you can’t have any constructive conversations with anyone.”
Zinc plans to start with three leased Airbus SE jets, and will fly to Melbourne, Sydney, Brisbane, Adelaide and Gold Coast, Mr Kelly said. More aircraft will be added in the first year of operations, he said.
By Angus Whitley - Bloomberg
