Dubai's new 'no frills' airline will be called 'FlyDubai' and initially serve destinations within the GCC, its chairman Sheikh Ahmed bin Saeed Al Maktoum announced today.

Sheikh Ahmed, who is also chairman of Emirates airline, said that FlyDubai will be based at Al Maktoum International Airport in Jebel Ali, and will operate separately from Dubai's flagship carrier.  Branding for FlyDubai is expected to be unveiled in the next few months.

FlyDubai will compete with a number of other low-cost operators in the Gulf - including Air Arabia, Jazeera Airways, Sama and Nas Air.  Its launch was announced at a time of record fuel prices.

Other full-service airlines, including Qatar Airways and Abu Dhabi’s Etihad have both said they are considering low cost carriers.

Sheikh Ahmed said: "FlyDubai is a simple, yet powerful call to action. It makes an immediate link to our core business, which is providing no-frills flights to bring people to and from Dubai."

"Operations will potentially cover an area of some two billion inhabitants. It will support Dubai’s commercial and tourism sectors by serving a new set of travellers. FlyDubai is on track to launch its first flights by mid-2009."

Ghaith al Ghaith, Chief Executive, FlyDubai said: "Efficiency is the pillar of our business model. In terms of our customer proposition, we will focus on keeping things simple and flexible. We want to make it easy for our customers to interact with us, and to have more control in how they book, purchase and select value-added services to their basic flight experience."