Hong Kong's Cathay Pacific Airways is considering launching a low-fare airline in response to developments in other parts of Asia that look set to change the operating environment in the region.

Cathay's corporate development director, Tony Tyler, says a low-fare unit is something Cathay is now considering, although he adds that "starting a new carrier is only one of a multitude of things we could do in response to market developments".

Industry sources say Cathay has been assessing the viability of a low-fare unit for several months. In August it was revealed that Air Macau, which is based on the former Portuguese enclave of Macau just west of Hong Kong, was considering a transformation into a low-fare operation. Air Macau has declined to comment.

Low-fare airlines have yet to come to Asia in the same way that they have in Europe or the USA, but the environment is changing quickly. Scheduled for 2004 are the launches of several new low-fare airlines in Singapore, Thailand and elsewhere.

Cathay competitor Singapore Airlines recently announced plans to establish a no-frills carrier called Tiger Airways in partnership with European and US investors.

Source: Flight International