Malaysia and Australia are in talks to open a low-cost air route between the two countries, spearheaded by Qantas-owned Jetstar and AirAsia, Malaysia's transport minister said on Monday.
Malaysia-based AirAsia recently unveiled bold plans to expand its route network to include longer-haul destinations, but the price to secure landing rights in Australia looks like being a reciprocal agreement for Jetstar to share the new business.
"An Australian low-cost operator will be operating (from Kuala Lumpur)," Chan Kong Choy told Reuters in a interview.
"We are negotiating now so if things go on fine you can see a low-cost carrier from Australia by the second half of the year." When pressed, Chan confirmed the carrier was Jetstar.
Jetstar could be the first major foreign airline to fly out of Kuala Lumpur's busy low-cost terminal, which is run by Malaysia Airports Holdings Bhd and used almost exclusively by AirAsia. the region's largest low-cost airline.
The terminal is expected to handle about 6.5 million passengers this year and is rapidly approaching its current capacity of 10 million passengers less than a year after opening.
AirAsia's founder and chief executive, Tony Fernandes, said this month he wanted to double the airline's Airbus A320 fleet to 200 as it looked to expand its service in the region.
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