Hong Kong Express to become low-cost carrier

Intends to complete transformation by the third quarter of this year.

Hong Kong Express Airways Ltd. Will unveil in late May the details of its plan to turn the airline into a budget carrier by the third quarter.

President Yang Jianhong said he sees rapid growth potential for budget-carrier services, as penetration in Asia remains low compared with more developed markets in Europe and the U.S. The airline has appointed consultants to advise the company about its changes.

The shift in Hong Kong Express' business comes on the heels of falling demand for full-service flights and first- and business-class seats amid the global economic slowdown.

Hong Kong Express currently operates flights between Hong Kong and Guilin on the mainland, Taichung in Taiwan and Sanya on Hainan Island.

Hong Kong Express is controlled by Hainan-based HNA Group, one of China's largest private companies. HNA also controls Hong Kong Airlines Ltd., which shares ticketing, fleet management and other facilities with Hong Kong Express.

Hong Kong Airlines, which operates more than 20 Airbus 320s and 330s, has transferred two A320s to Hong Kong Express in preparation for the budget carrier's launch.