No-Frills Carriers Plan Global Flight Alliance

Virgin plans to team up with AirAsia and easyJet to form a Malaysia-based alliance that will fly long-distance routes for low fares.

According to Malaysia's Star newspaper, Branson is in discussions with AirAsia’s CEO Tony Fernandes and easyJet’s Stelios Haji-Ioannou.

Quoting unidentified industry sources the report says that the new joint venture will first fly between Kuala Lumpur and Manchester in Britain and Amritsar in India. Later plans are for flights to Hangzhou near Shanghai, China and Tianjin near Beijing.

The alliance –if it decides to fly to London as well- could also use the Luton airport as a hub because Virgin already operates a rail link from there to central London. It said that the alliance will give Virgin and easyJet access to Kuala Lumpur's low-cost airport terminal.

However, a spokesman for easyJet told Reuters news agency that the British low-cost airline had not discussed any such alliance with AirAsia. A Virgin spokesman refused to deny Virgin Atlantic has held talks with AirAsia.