Qantas unit, AirAsia to form non-equity alliance

SYDNEY Jan 6 (Reuters) - Jetstar, the budget airline owned by Australia's Qantas Airways Ltd (QAN.AX), and Malaysia's AirAsia (AIRA.KL) have agreed to form a non-equity alliance to cut costs, Qantas said in a statement on Wednesday.

The alliance will explore opportunities in areas including joint procurement of aircraft and pooling of inventories, the statement added.

Airlines worldwide have been grappling with falling demand, higher funding costs and volatile fuel prices.

AirAsia, the region's biggest low-cost carrier, and Jetstar have grown rapidly and now fly routes across Southeast Asia and Australia. (Reporting by Denny Thomas;)