Singapore’s flag carrier has announced that it will be launching a new budget long-haul airline.

Named ‘Scoot’, the venture is set to commence flights midway through 2012 as the company is looks to cash in on the fast-growing Asian air travel market, which the International Air Transport Association projects to grow 6.4 per cent in 2011 alone.

Singapore Airlines said in a statement that the new airline would stick to the ‘low-frills spirit’ that has seen enormous success in short haul routes in Asia and throughout the world. It went on to say that Scoot would offer fares with discounts of up to 40 per cent off fares offered by legacy airlines.

Scoot is likely to see fierce competition from Kuala Lumpur-based Air Asia X, Air Asia’s budget long-haul affiliate, in addition to Jetstar and other locally based enterprises. However analysts point out that SIA is no stranger to low-cost brands, as it already operates low-cost short-haul airline Silk Air and is the majority shareholder in Changi-based Tiger Airways.

Officials said that initial destinations on the new airline’s route map would stretch from Mainland China across Southeast Asia and on to Australia and that further flights to Africa, the Middle East and Europe would be added later on.