Australia's newest budget airline says it isn't out to compete directly with embattled Qantas.
From November 15, Brisbane-based Strategic Airlines will add more routes and rename itself Air Australia.
Its planes and cabin crew will change their colours from red, white and blue to the nation's iconic green and gold sporting colours, with a boomerang as its motif.
Speaking at the airline's Brisbane launch on Thursday, Queensland Attorney-General Paul Lucas said the airline's birth should be a warning to Qantas, which has damaged its reputation through debilitating contract negotiations with its workers.
Mr Lucas said Air Australia was poised to shake up the market.
"Those airlines that have been around Australia for a long time need to understand that no-one has a monopoly of calling itself the Australian airline," he said. "This airline is 100 per cent Australian owned, is hungry ... and it is out there wanting to grow its market share.
"That can only be good for tourism and can only be good for Australian customers."
Chief executive Michael James said the airline would not be competing directly with Qantas or Jetstar and would focus on under-serviced routes, particularly direct international flights from Brisbane and Melbourne.
"We're on a bit of a different model," he said. "We're trying to offer them a different service to fly directly out of these airports." He added he knew it was a "turbulent and competitive" environment.
The airline will absorb existing Strategic Airlines routes from Brisbane and Melbourne to Phuket and Brisbane to Bali, with Honolulu to be added in December.
Further on, direct flights from Melbourne and Brisbane will also head to the west coast of the USA, Vietnam and Japan. Domestically, Strategic flies to Western Australia's mining towns, with routes between Brisbane and Port Headland and Perth and Derby.
Those routes will remain, and services to Darwin and Melbourne will be boosted. Sale flights will be available until November 15 from $249 one-way to Bali, $329 to Phuket, and $349 to Hawaii out of Brisbane and Melbourne, running between two and six times a week.
Non-sale prices would then increase by between $20 and $150. No other airline was flying to Honolulu from Brisbane or Melbourne, Mr James said.
"I think it is re-educating Australia that you don't have to go via Sydney anymore," he said. Passengers will also be offered their first bag free.
The airline's frequent flyer program, which is yet to be created, will allow members who fly nine times to get the 10th flight free. Air Australia's fleet will be boosted from three A320s to six by mid-2012 and one A330 to three by May 2012.
Staff would also increase from around 300 to 3000 by 2021.
