Singapore Airlines (SIA)  has announced its intention to establish a new no-frills, low-fare airline which will operate wide-body aircraft on medium and long-haul routes. 

It says the new airline is being established following extensive review and analysis. 

SIA says it will enable the group to serve a largely untapped new market and cater to the growing demand among consumers for low-fare travel. 

Operations are expected to begin within one year. 

The airline will be wholly-owned by Singapore Airlines, but will be operated independently and managed separately. 

SIA CEO Goh Choon Phong said there's a new market segment being created and this will provide another growth opportunity for the Group. 

He said low-fare airlines flying short-haul routes within Asia, has helped stimulate demand for travel. 

Mr Goh says he expects this will also prove true for longer flights. 

More details will be announced by the new airline's management team in due course, including its branding, products and services, and route network. 

Aviation analyst from Standard and Poor's, Shukor Yusof, expects air fares on the new no-frills carrier to be some 20 to 30 per cent cheaper compared to current SIA economy class fares.

" These are fares that are going to capture imagination or going to be attractive to younger people, or to people who are more price-conscious, and who expect better service than what some of the other carriers are offering right now. SIA coming out with this airline would mean a stronger, more efficient, better-run airline that's got a very strong management, that's got the infrastructure, the huge resources required to take a lot of business from its rivals."

SIA already runs a short-haul mid-price airline called SilkAir, and owns 32.9 percent of budget carrier Tiger Airways.