Qantas plans to establish new Singapore-based premium airline - report

SYDNEY May 13 (Reuters) - Australia's Qantas Airways plans to establish a new premium airline based in Singapore as part of plans to grow its operations in Asia and cut costs, a local newspaper said Friday.

An internal team at Qantas has revived a plan to set up a full-service subsidiary carrier in Asia with up to 20 aircraft based in Singapore operating under a new airline licence, the Australian Financial Review newspaper reported, citing unnamed sources.

The airline would be called "Qantas Asia" or something similar to match Qantas' low-cost subsidiary Jetstar Asia which is also based in Singapore.

Qantas may use the Singapore subsidiary to build up its network in Europe, the report said. The immediate focus was not to challenge Singapore Airlines and Cathay Pacific's market share, it added.

The move could anger unions which are threatening industrial action at the carrier. Aircraft engineers on Thursday called off plans to strike on Friday but there are plans for further industrial action next week.

(Reporting by Michael Smith; Editing by Balazs Koranyi)