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AirAsia, Asia's largest budget airline, expects to carry 250,000 passengers on its new Kuala Lumpur-Singapore route this year and aims to expand destinations with extra flights to Vietnam and Indonesia.

Two daily flights between Singapore and Kuala-Lumpur will start February 1, though the firm could not say what market share it expected to grab from current monopoly holders Singapore Airlines and Malaysia Airlines.

«Over the next 5 years, we expect to carry about 7 million passengers between Singapore and Malaysia,» said Tony Fernandes, chief executive of AirAsia, at a press conference.

Singapore and Malaysian governments decided to partially open the Singapore-Kuala Lumpur air route in November last year, by allowing four daily services by low-cost carriers, ahead of an «open skies» policy by Southeast Asian nations.

Fernandes said he is eyeing routes between Singapore and the Malaysian cities of Penang, Kota Kinabalu and Kuching.

«KL-Singapore was a giddy knot -- breaking that makes opening up the others a lot easier,» he said.

With oil prices soaring, AirAsia will aim to pass on the costs to passengers by charging them for services such as priority boarding and internet check-in, Fernandes said.

AirAsia will also be looking to open an air route to Ho Chi Minh City in Vietnam and to fly to more Indonesian destinations.

«We have so many planes coming in, it's a matter of where to put them,» Fernandes said. AirAsia said it recently ordered 175 Airbus A320s to be delivered by 2013.

A spokeswoman said long-haul budget carrier AirAsiaX, in which AirAsia holds a 20 percent stake, was in discussions with Airbus to buy more planes, but nothing had been decided.

AirAsia's competitors Jetstar and Tiger Airways will also have rights to operate a daily return service from Singapore to Kuala Lumpur. Jetstar is a unit of Australia's Qantas Airways, while Tiger is 49 percent held by Singapore Airlines.

(Reuters)