Thu, 10 Mar 2005

From: AFP

AirAsia to serve China: Report

BEIJING: Malaysia's AirAsia is to offer daily services between Bangkok and the southeastern Chinese city of Xiamen, becoming the first no-frills foreign airline to fly to China, state media said on Wednesday.

Asia's biggest and pioneering budget carrier will start operations next month, the China Business News reported, citing sources.

The airline will price its maiden round-trip flight at just 299 yuan (US$36), less than one-sixth the rate offered by local carrier Xiamen Airlines, the newspaper said.

Once the promotion period is over, a regular round-trip fare will be 1,000 yuan ($120).

An official at Xiamen Airlines said he expected AirAsia to take away some of its leisure passengers, who currently account for some 30 percent of its clientele, but the full extent of the impact remains to be seen.

Two other Asian low cost airlines -- Jetstar Asia and Valuair, both Singapore based -- are also seeking Chinese government approval to fly from Singapore to major mainland cities.

Last December, AirAsia announced it would buy 40 Airbus aircraft and exercise the option to buy another 40 A320 jets, adding that it would launch flights to China by March.

Launched as a budget carrier in December 2001 with just two aircraft, AirAsia has defied the skeptics to become a significant player in the region. -- AFP