Tiger Airways, the budget carrier that some love to hate, part-owned by Singapore Airlines Ltd., will start a low-fare airline in Bangkok, challenging AirAsia in Southeast Asia’s busiest airport.

Thai Airways International and another local company will own 51 percent of Thai Tiger Airways, which is due to start operations in the first quarter of next year, the carriers said in a statement. Tiger Air will own the rest. The venture will fly domestic and overseas routes of up to five hours.

Tiger Air plans to add a Bangkok base to its operations in Singapore and Australia after rebounding economic growth helped fuel a 14 percent jump in first-half Thai tourism arrivals. The airline will compete with AirAsia, the region’s largest discount carrier, which already has a hub in the Thai capital and plans to list shares on the local stock exchange.

“This is a really big step up for Tiger Air in terms of its regional competitiveness,” said Peter Harbison, managing director at the Sydney-based Centre for Asia Pacific Aviation. “This puts it firmly in the competitive market place that AirAsia and Jetstar are fighting to be in. It’s about establishing a regional brand.” Jetstar is the budget carrier owned by Qantas Airways Ltd.  The companies need approvals before the new airline can start operation, according to the statement. The venture may break even within two years of operations said  an analyst at DMG & Partners Securities, said in a note today.

The future remains yet to be known but all involved claim that the market is big enough to sustain this expansion.

What do you think, can Tiger do it?

Have you flown Air Asia?