Jetstar says its growing fleet of Boeing 787 Dreamliners is delivering substantial savings.
The airline's chief executive for Australia and New Zealand, David Hall, said unit costs - including fuel, engineering and staff expenses - were 10 per cent lower than for the planes they were replacing.
Jetstar is today beginning an Auckland to Melbourne Dreamliner service three times a week during March to showcase the super-strong new-generation plane made largely of carbon fibre.
"Unit cost reduction [is] more than 10 per cent and we're able to pass those savings on to our customers to stimulate demand," Hall said.
The low-cost airline got its first 787-8 Dreamliner in November. It now has three and will eventually have 14 to fly its long-haul international routes into Asia.
The planes have flown around 300 commercial sectors between four destinations - Sydney, Melbourne, Denpasar in Bali and Phuket in Thailand.
Last year Dreamliners were grounded for nearly three months because of problems with overheating batteries.
"We work very closely with Boeing, we've had no such issues. We've had a couple of minor technical issues but certainly nothing out of the ordinary when you're inducting a new fleet."
Jetstar's planes had been nearly 99 per cent reliable, Hall said. Demand had been strong for its Melbourne service in March, which coincides with the running of the Formula 1 Grand Prix in the city on March 16.
The Dreamliner replaces the Airbus A320, adding extra capacity of more than 3700 seats. The Dreamliner has bigger windows and because of its fuselage strength is able to have higher humidity, allowing for a more comfortable cabin.
"Those who have booked it specifically or those who have lucked it on the day are blown away by what an awesome aircraft it is," Hall said.
General manager of product at Flight Centre Simon Mckearney said Jetstar's use of the plane was a "bit of a statement" by the airline.
"It's also to say, 'We're serious about getting outbound passengers,' their pricing doesn't need to be any cheaper but what it will do is increase their return because the aircraft is much more efficient."
The airline will introduce the Dreamliner on its Auckland to Singapore route, which it flies three times a week, and is likely to face growing competition from a revived Air New Zealand and Singapore Airlines alliance this year.
"We always review our capacity as part of any business model," said Hall, "and we'll do the same on Auckland-Singapore."