The company plans to launch its services from September with an initial investment of $50 million (Rs 225 crore).
It will be headquartered in Chennai. Confirming this, Premier Airways director V Chidambaram told Business Standard that the airline would connect all metros from Chennai to begin with.
"We have plans to connect other south Indian cities from Chennai," he added. Premier Airways is the second low cost carrier from South India. Madurai-based
Paramount Airways had launched commercial flights on October 19 from Coimbatore. Other low cost carriers include Capt G R Gopinath-promoted Air Deccan, Gurgaon-based SpiceJet and the Wadia Group promoted GoAir.
In addition to them, Premier Airways has to compete with no frill airlines Air India Express and Alliance Air of state-run Air-India and Indian Airlines, respectively.
Premier Airways was in talks with European aircraft manufacturer Airbus for taking aircraft on lease, sources said, adding that it would take five aircraft initially. The airline would have total fleet of 26 aircraft over three years, they added.
"As the Airbus Industrie is running full on capacity, the European aircraft manufacturer will lease out aircraft and subsequently acquire fleet," sources said.