Fernandes eyeing opportuity for Air Asia Gulf

Tony Fernades, the head of Malaysian low cost carrier Air Asia has confirmed the airline is in talks with potential partners in the Gulf to launch a true low-cost carrier for the region.

Fernandes was in Doha to launch a joint venture hospitality and financial services business called Tune with Qatari businessman Mohammed Al Saad.

But while talking to journalists about the opportunities for the new venture, Fernandes said he was also "seriously" looking at other opportunities including the setting up of a low cost carrier in the GCC.

Air Asia already operates to Tehran and is launching flights to Jeddah. But fernandes beleives there is still no true low cost carrier in the Gulf.

"As a low-cost carrier, we are about creating new markets. The key is to create really low fares, which I think the Gulf hasn't seen."If you want to compete, you have to create a product that's very different and extremely low priced, so that a guy can go to Dubai for a cup of coffee and come back with his airfare being about the same as his taxi fare," Fernandes said.

He declined to name any of the organisations or individuals that he was in talks with.

Fernandes also said that Air Asia would consider a hub in the Gulf to help reduce costs from the EU's ETS scheme which taxes carriers for the total distance of a single flight into Euope. However, just two years ago Air Asia X abandoned Abu Dhabi, just three months after a high profile launch of the UAE capital as its hub in the region.