Tigerair Taiwan is set to purchase seven Airbus A320neo jets and lease another eight by 2021 as the Taiwanese carrier looks to develop new routes and expand its operation to meet the growing demand for low-cost travel in the region.

Its parent company, China Airlines, said the deal to acquire the 15 narrowbody jets will cost Tigerair Taiwan US$729 million. It will also increase the fleet size of the low-cost Taiwanese carrier to 26 from the 11 Airbus A320 planes currently operating.

Tigerair Taiwan operates 29 routes from its hub in Taoyuan, Kaohsiung and Taichung, flying to destinations in Japan, Macau, the Philippines, Thailand and South Korea.

Its biggest operation is in Japan where it serves 20 destinations.

China Airlines also announced it is set to launch the first-phase of initial public offering for Tigerair Taiwan shares by the fourth quarter of 2020. Currently, China Airlines holds 90% of Tigerair Taiwan shares, while the remaining 10% is owned by Mandarin Airlines.

The budget airline made a profit of NT$1 billion (US$31.9 million) in 2018.