Malaysia Airlines is to establish a hub operation in the eastern part of the country, located at Kota Kinabalu in the Sabah region.

The carrier says it will create the hub in a three-phase process starting in November this year and running until June 2011, by which time it will have six aircraft - including two Boeing 737-800s and four 737-400s - stationed there.

Malaysia Airlines says it will develop new international routes from the hub, stating that it is an "ideal gateway" for travel to China, northern Asia, Indonesia and Australia.

"The setting up of Kota Kinabalu as the eastern hub enables us to provide our customers with better flight schedules and connectivity as they would not need to wait for the aircraft to arrive from Kuala Lumpur," says chief executive Azmil Zahruddin.

Malaysia Airlines will base 150 flight crew and 250 cabin crew at the new hub. The airline is already planning services to Tokyo Haneda in November, and flights to Osaka in January.

Its network will also include daily flights to Taipei and Hong Kong, and four-times weekly services to Kaohsiung and Seoul.

Malaysia Airlines says it will align flight schedules from Kota Kinabalu with its MASwings operation to provide better connections. It adds that the new development could improve its bottom line by RM60-100 million ($19-32 million).

Source: Air Transport Intelligence news