(Adds details from chairman, context)
BEIJING, July 2 China Eastern Airlines Corp
said on Wednesday that it has officially transformed
its Beijing-based full-service subsidiary China United Airlines
into a budget carrier.
China Eastern will also increase the number of planes in
China United's fleet to 80 by 2019, from 26 as of the end of
May, the carrier said in a statement. It was not immediately
clear whether the airline would order more planes, or use
aircraft from its parent's fleet.
China Eastern Chairman Liu Shaoyong told reporters China
United hopes to bring on board a strategic investor.
The launch of China United may also raise questions about
the fate of Jetstar Hong Kong, a budget carrier jointly owned by
China Eastern, Macau gambling mogul Stanley Ho and Australia's
Qantas Airways Ltd.
Intended to be the only low-cost carrier flying from Hong
Kong, Jetstar Hong Kong has faced delays in securing its airline
China's airline market, which is dominated by state-owned
carriers China Eastern, China Southern Airlines and
Air China, is believed by analysts to be on the cusp
of a low-cost travel boom.
Northeast Asia, especially, is seen to be a laggard in the
low-cost air travel market, with only a handful of small
carriers flying in Japan and South Korea.
($1 = 6.2115 Chinese Yuan Renminbi)
(Reporting by Fang Yan and Koh Gui Qing; Editing by Ryan Woo
and Miral Fahmy)