British Airways owner IAG's (LON:IAG) low-cost long-haul flight division is to expand into short-haul routes.
The airlines group said it was setting up an Austrian division that will provide low-cost flights between Vienna and several European destinations.
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The new operation will compete with Laudamotion, an Austrian airline in which Ryanair has a 75% stake and which succeeded Niki, the collapsed Austrian airline founded by former Formula One world champion, Niki Lauda.
Operations are set to begin on July 17 with flights to Mallorca and London's Gatwick airport.
The list of destinations will subsequently be expanded to include six more Spanish destinations - Alicante, Barcelona, Bilbao, Ibiza, Malaga and Valencia – plus three Italian airports: Malpensa, Olbia and Venice.
Paris Charles de Gaulle airport, Dubrovnik in Croatia and Cypriot resort Larnaca are also to be added to the network.
“We are launching this new short-haul subsidiary to provide Austrian consumers with more flight choices across Europe,” said Willie Walsh, IAG's chief executive officer.
"These flights will be branded as LEVEL to build upon the huge success of our new long-haul low-cost operation," he added.
IAG already has a no-frills short-haul airline, Vueling, but that is based in Barcelona.
So when attempting to book the new Level flights you’re taken to the Vueling website where it shows the flights being operated by Anisec which seems to be the registered name of the airline that will actually be operating the flights as Level... pic.twitter.com/pjQMrlDs4H
— Voyage Report (@voyage_report) June 28, 2018
IAG has been showing increased interest in the low-cost airlines sector, having taken a 4.61% stake in Norwegian Air Shuttle with a view to using the holding as a launchpad for a full bid.
READ: British Airways parent IAG reportedly plans to offer €1.52bn for Norwegian Air Shuttle
Shares in IAG were down 1.1% on Thursday morning.