AirAsia, Jetstar alliance creates industry giant

Pioneering low cost carrier, AirAsia, has announced a non-equity alliance with another leading regional LCC, Qantas subsidiary Jetstar Airways, which is aimed at reducing costs, pooling expertise and maintaining lower fares.

AirAsia CEO Tony Fernandes said both AirAsia and Jetstar would also look into joint procurement of aircraft.

Related to this, the alliance has announced a first of its kind, "...joint specification for the next generation of narrow-body aircraft."

This is likely to create ripples in the aviation industry for it will seek to influence the configuration of narrow-body aircraft that manufacturing giants Airbus and Boeing are expected to decide upon when they renew their respective A-320 and B-737 series.

Both the series have variants that start at 106 seats, but these manufacturers are to decide if they would like to reconfigure their next-generation variants for numbers higher than 150 passengers or stick to current patterns.

The new alliance creates a combined fleet, plus orders and options, of nearly 400 aircraft, and this would make it an influential voice in shaping the design of the new A320 and 737 variants.