The government is looking for a "suitable marriage model" for Malaysian Airlines and its no-frills rival AirAsia to end a price war between them, Transport Minister Dr Ling Liong Sik said today.

Ling said the ministry was studying strategies adopted in other countries with dual airlines to find the most appropriate model.

"We want to see what's a suitable marriage model for the two airlines," Ling told a news conference.

"The bottom line is both must survive. We don't want to see anyone disadvantaged and going bankrupt.

"We don't want to see anyone of them suffering in the interest of the workers, in the interest of the banks and in the interest of both the companies. So we are taking our time, there is no rush into this sort of thing."

Exclusive routes

Ling said the government would eventually want to have no-frills flights being offered for domestic routes.

"We are a very small country. I would like to see all airlines go no-frills because 99 percent of flights are less than 40 minutes. Everybody wants low cost... we are studying the model," he added.

The transport ministry, mediating a price war which started in August, has said it was considering giving exclusive air routes to both the carriers to reduce the stiff competition.

In a bid to counter AirAsia's cheap domestic fares, Malaysia Airlines slashed some domestic airfares by half from Aug 22 and said it was considering introducing no-frills flights

AirAsia immediately followed suit by cutting its fares further and complained to the government on what it said was the flag carrier's attempt to sabotage its expansion into the region.

After surviving nearly a year in business, AirAsia has mapped out a bold new expansion plan that involves more than doubling its fleet, increasing flight frequency and launching international destinations.

Since beginning domestic flights in December last year, it has flown 800,000 passengers and was now making a monthly profit of RM1 million. AFP