Ambitious Malaysian no-frills airline AirAsia today said it is prepared to cooperate with national flag carrier Malaysia Airlines to promote air travel both in and outside the country.

"We can complement each other. Both carriers can benefit. We have different products for different markets. There is space for everybody," Pahamin Rajab, AirAsia chairman, told AFP .

Pahamin had been asked to comment on concerns and opposition raised by Malaysian Airlines over a plan to turn the former international airport, Subang Airport, west of the capital, into a regional no-frills airline hub.

Transport Minister Chan Kong Choy recently said the government was studying a proposal to build a low-fare terminal at Kuala Lumpur International Airport or transform the now unused terminal in Subang into a low-cost hub.

Malaysia Airlines in remarks published Wednesday poured cold water on the idea.

Ahmad Fuaad Dahlan, managing director, said the move to revive Subang airport was "unfair" as it would prevent it from competing with other airlines on a level playing field.

"If Subang airport is revived, it would have financial implications not only on Malaysia Airlines but others as well," Ahmad Fuaad said in a New Straits Times report.

No strategic alliance

Ahmad Fuaad also said Malaysia Airlines was not interested a strategic alliance with AirAsia since its domestic routes were doing well with an annual average load factor of over 70 percent.

The Business Times newspaper reported last week, citing unnamed sources, that AirAsia might take over Malaysia Airlines' domestic services.

Malaysia Airlines has denied any knowledge of such a plan while Pahamin said previously AirAsia had not been approached on this but would not balk at the opportunity if it came.

"We would still like to cooperate with Malaysia Airlines," AirAsia chief executive officer Tony Fernandes said.

"We'd like to see a win-win situation. We will wait for the government to decide on the low-cost hub," he said.

AirAsia has become Southeast Asia's version of European budget carrier Ryanair. It has carried more than four million passengers since it was launched in December 2001. - AFP