HANOI, April 3 (Xinhua) -- Asia's largest budget airline by fleet AirAsia plans to establish a low-cost carrier in Vietnam for regional expansion, according to the airline's Vietnamese partner on Monday.
AirAsia is partnering Vietnam's Thien Minh Group to form the 44-million U.S. dollars joint venture, in which AirAsia holds a 30 percent stake, reported local Tien Phong (Pioneer) newspaper on Monday.
Dinh Thu Trang, director of Thien Minh Group's Development Section was quoted on Tien Phong newspaper as saying that the joint venture aims to begin operation by early 2018, focusing on "domestic and international under-served routes" to connect key Vietnamese cities to AirAsia's vast network across South East Asia.
According to the Civil Aviation Administration of Vietnam, airlines transported some 52.2 million passengers in 2016, up 29 percent from the previous year. Of them, domestic passengers accounted for 28 million, an increase of 30 percent year-on-year.
The Vietnam's middle-class can account up to a fourth of the country's population by 2020, which will offer the new carrier an opportunity to tap into a large pool of potential customers, many of them first-time fliers, AirAsia assessed in its stock exchange filing.
Todate, Vietnam has been home to only two budget airlines, including VietJet Air and Jetstar's Pacific Airlines.
