Korean Air to launch budget airline next year

Korean Air has announced plans to launch a low-cost airline next year.

The service, which is reputedly to be called Air Korea, will run three Airbus A300s and two Boeing 737s.

Initial flight routes will run from Shangdong to Hunan provinces in China, along with a series of destinations in Japan, Malaysia and Thailand.

The service will subsequently be expanded with further "short-or-mid-distance destinations," a statement from the carrier said.

"Korean Air and Air Korea, a separately operated subsidiary will complement each other for a win-win relationship. Korean Air will concentrate on upper class business travel demands and Air Korea shall focus on travellers seeking shorter distance leisure travel routes," the statement continued.

Korean Air's announcement comes after rival carrier Singapore Airways' subsidiary Tiger Airways confirmed it will start a new Korean budget airline next year.

Tiger plans to run the service as a joint venture with the port city of Incheon

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