Australia's Qantas Airways will close its Singapore-based budget airline Jetstar Asia, the group said on Wednesday, blaming rising supplier costs, high airport fees and strong regional competition. The shutdown of the 20-year-old airline next month will result in up to 500 job losses,

Qantas Airways Ltd. said low-cost subsidiary JetStar Asia will close next month, freeing up as much as A$500 million ($327 million) in capital to fund the group’s fleet renewal program.

The Jetstar Asia aircraft will boost the Qantas Group’s operations in Australia and New Zealand in multiple ways. Some of the A320s will be used for capacity growth, some will replace leased narrowbodies, and others will be used for fleet renewal in the group’s regional operation in Western Australia.