Chief executive officer Azran Osman-Rani told the New Straits Times that the carrier had begun negotiations with several cities including Newcastle in New South Wales and Avalon in Victoria.

'We are keen on Avalon as it is an open airport without any congestion. It will also be cheaper for us to land there,' he told the daily from the Gold Coast where the inaugural flight from Kuala Lumpur landed on Friday.

Newcastle is within striking distance of Sydney and Avalon is near Melbourne.

Mr Azran said the second Australian destination would be added after AirAsia X - currently operating with a leased Airbus A330 - takes delivery of a fleet of 15 aircraft next September.

AirAsia X said last week it plans to launch flights to Britain in the fourth quarter of 2008, with London and Manchester being considered. It is also eyeing China as it expands its network.

Mr Azran said that besides those countries, the carrier was planning to introduce routes in the Middle East, north Asia, India, Korea and Japan and central or eastern Europe within the next five years.

'We are also looking at Amritsar in India and maybe open up a new market in central or eastern Europe, like Prague or Moscow, he told the New Straits Times. -- AFP