BANGKOK - The upstart low-fare carrier AirAsia, which kicks off its Thai domestic service on Feb 3, expects to serve one million passengers in 2004, or about 15 percent of the Thai market, said its executives.

"We expect to carry one million passengers by the end of the year," Tassapon Bijleveld, the company's chief executive officer, told reporters in Bangkok at a launch of the carrier's US$2.50 ticket promotion campaign.

Executives also shrugged off the expected competition from other budget carriers, including a no-frills partner to the kingdom's flagship carrier Thai Airways International, as well as Orient Thai.

"Our target market is the person who has never flown before. The other airlines might offer five-star service level while we offer about three stars," he said.

AirAsia is 51 percent owned by Thai Prime Minister Thaksin Shinawatra's family-controlled Shin Corp., while the remainder is owned by Malaysia's AirAsia Aviation Co Ltd.

Competition is good

Boonklee Plangsiri, chairman of the board for Thai AirAsia, said the domestic Thai market, which reached seven million passengers in 2003, was mature enough to handle several carriers.

"Competitors can be friends or enemies, but the increased competition will be good for consumers," Boonklee said, adding AirAsia hoped to break even "within eight to 10 months of operation."

AirAsia will fly three daily routes from the capital Bangkok to the northern city of Chiang Mai, the resort island of Phuket, and southern Hat Yai from Feb 3, while flights to Khon Kaen in the northeast are to begin Feb 12.

It intends to crack into the international market by March or early April, when it plans flights from Bangkok to Singapore, Tassapon said.

The airline offers an average discount of 20 to 50 percent off comparative rates of other domestic airlines, Tassapon said, while some 20,000 of the promotional tickets will be available for flights in February. - AFP