VietJet Air is planning to launch a brand new low-cost carrier in Vietnam with the help of Kuala Lumpur based AirAsia, and has tentatively branded the new carrier VietJet AirAsia.

Announced last week in front of both the Malaysian Prime Minister, Najib Abdul Razak, and Vietnamese Deputy Prime Minister, Truong Vinh Trong, the move builds upon AirAsia’s 30% equity stake in VietJet Air.

“We are grateful for the presence of the leaders of Malaysia and Vietnam as we sign this agreement for strategic partnership.  Their presence today is a clear indication that we have the support of both governments in our efforts to further grow tourism in the ASEAN region,” said Tony Fernandes, AirAsia CEO.

“The launch of flights by VietJet AirAsia will undoubtedly benefit both leisure and business travellers,” adds Nguyen Duc Tam, VietJet Air CEO. “We’ll also connect Vietnam to more cities in ASEAN to boost intra-regional travel.”

Local media reports have brought up the possibility of the new airline launching in August this year.