Thailand is primed to become a key battleground for Southeast Asia's booming low-cost carriers (LCC), as three overseas airlines race to set up joint-venture affiliates there.

Asia's largest LCCs have already proven the model of establishing joint ventures in other countries as a way of sidestepping ownership and control restrictions. Thailand has become the latest hotbed of activity on this front, as Lion Air, AirAsia X and VietJet Air seek permission to create joint ventures based in Bangkok. Meanwhile, the incumbent LCCs are growing their networks in anticipation of the influx.

The development of Southeast Asian LCC markets is of great interest to the major aircraft manufacturers. Some of the industry's largest narrowbody orders come from the region, based on the expectation that the LCCs can keep growing by pushing into new markets. The older Asian premium carriers are also paying close attention, as the LCCs are changing the dynamics of competition.

Indonesia's Lion Air has revealed more details about its proposed Thailand joint venture, which it hopes will be flying by the end of this year.

Thai Lion Air will launch with two Boeing 737-900ERs. There will initially be three routes—from Bangkok to Jakarta, Kuala Lumpur, and the Thai city of Chiang Mai. The new airline will be based at Bangkok's Don Mueang Airport, instead of the main Suvarnabhumi Airport, and it has already opened an office there.

Lion is waiting for the Thai transport minister to approve its air operator's license and then for the civil aviation authority to grant it a separate air operator's certificate. The LCC has previously said it will not announce the exact launch date until it has received these approvals. It has also not yet publicly revealed the identity of its Thai investors, although it confirms that the carrier will be 51% Thai-owned, as required by local law.

Malaysia-based AirAsia X is also making significant progress toward launching an affiliate carrier in Thailand, having formally established the joint venture that will control the new airline.

AirAsia X is the long-haul unit of the AirAsia group, which already has a short-haul joint venture in Thailand. The new long-haul carrier, Thai AirAsia X, is expected to start operations from Bangkok in the first quarter of 2014, a spokeswoman for the airline says. This will be the first AirAsia X affiliate outside Malaysia.

The carrier will likely start with a single Airbus A330, and its first route will be from Bangkok to one of the other destinations that AirAsia X already serves from Kuala Lumpur, says the spokeswoman. Destinations in Japan, South Korea, China, Taiwan or Australia are all early route possibilities.

More details about Thai AirAsia X emerged in a Sept. 18 filing with the Malaysian stock exchange. An application for an air operator's license was submitted in June, and the carrier expected this to be granted by the end of September. It will then proceed with a submission for an air operator's certificate.

AirAsia X controls a 49% stake, with 41% held by Tassapon Bijleveld, who is also CEO of the existing Thai AirAsia. The remaining 10% is held by prominent local businessman Julpas Kruesopon. The partners plan to invest 1.1 billion Thai baht ($35.1 million) through 2015.

The third new-entrant LCC is an affiliate of VietJet, with local carrier Kan Air the required Thai investor. VietJet says the joint venture will launch in early 2014, pending approval. It will start with up to three A320s.

There are two main incumbent LCCs in Thailand: Thai AirAsia, which is the largest, and Nok Air.

The AirAsia short-haul affiliate is certainly not standing still. Three Airbus A320s have been delivered this year, bringing its fleet to 30. The airline expects to receive five more A320s by year-end, making 2013 its biggest year for growth since it was established in 2004. Another eight deliveries are scheduled for 2014.

Fleet growth is enabling Thai AirAsia to add frequencies and destinations. The carrier expects to open four more routes from Bangkok in October and November: to Siem Reap, Cambodia; Nay Pyi Taw, Myanmar; Khon Kaen, Thailand; and Kunming, China.

Thai Air Asia also has a smaller hub in Phuket in the south, and the carrier's spokeswoman says it is “tentatively” planning to open another hub this year at Chiang Mai, the largest city in northern Thailand.

Thai AirAsia plans to expand its network to include more cities in China, notes the spokeswoman. Flights to China from Chiang Mai “are also a possibility,” she adds.