Fast-growing Malaysian budget carrier AirAsia is expected to unveil details this week of its ambitions to expand into long-haul services, as it works on securing partners, possibly including Virgin Atlantic and the UK's Easyjet.

AirAsia will make an announcement in Kuala Lumpur on Friday on a new service. The carrier will not be drawn on the details of the announcement, but the Financial Times reports AirAsia will receive Malaysian state approval in the next few days to enter the long-haul business.

An earlier Malaysian newspaper report linked AirAsia to talks with Virgin Atlantic parent Virgin Group and EasyJet founder Stelios Haji-Ioannu on plans for long-haul budget links.

Virgin Atlantic is understood to have been approached by AirAsia over possibly taking a stake in the carrier or a separate long-haul low-cost venture. UK popular newspaper The Sun says it has confirmation from the airline of its intention to ally itself with AirAsia.

“We talk to a lot of people and are looking all the time at possible opportunities,” a spokesman for Virgin Atlantic says. Back in 2004 AirAsia held talks with Virgin Group’s Australian carrier Virgin Blue over the latter’s taking a stake in the airline, but these talks ended without an agreement.

EasyJet has dismissed the report of its involvement as unsubstantiated gossip. “EasyJet is not in talks with Virgin Atlantic or AirAsia with regards to forming any kind of alliance or global network,” says the airline.

AirAsia was established in 2001 and is headed by Tony Fernandes. It operates short-haul routes from its Kuala Lumpur base using a mix of Airbus A320s and Boeing 737s, but will switch over to an all-Airbus fleet following its 40-strong order for A320s last summer.

Kuala Lumpur in March last year became the first airport in Asia to open a terminal facility dedicated to low-cost carriers.

In late October another carrier, Hong Kong long-haul start-up Oasis Airlines, launched low cost services between Europe and Asia, debuting on the Hong Kong-London Gatwick route.

Blog:
Airline Business editor Mark Piling doubts the feasibility of blurring the long-haul network model with low-cost aspirations.

Source: FlightGlobal.com

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