SINGAPORE, Oct 9, 2008 (AFP) - A Singapore-based budget airline said Thursday bookings are up despite an escalating global economic crisis.

Matthew Hobbs, a spokesman for Tiger Airways, said travellers are seeking cheaper alternatives to allow them to fly by air.

"We are not seeing a decline... We are seeing that people are substituting from premium carriers to budget carriers like Tiger because they still need to travel," Hobbs told AFP.

"Forward bookings show that people are still booking and they are still travelling but they are looking for the best price."

Hobbs said budget airlines had historically experienced growth during crisis periods such as in the aftermath of the September 11, 2001 attacks in the United States.

While Tiger Airways will monitor the travel market closely, Hobbs said the airline would proceed with plans to expand flights and its fleet.

From December 1, the airline will increase service from Singapore to Kuala Lumpur to five times a day from once a day, he said.

Tiger Airways, which is 49 per cent owned by Singapore Airlines (SIA), says it would increase flights to Bangkok, Phuket and Macau later this month.

Four more Airbus planes are scheduled for delivery between December and March, raising the carrier's fleet from 12 to 16, Hobbs said.

"We will continue to monitor the market conditions for opportunities," he said.

Andrew Herdman, director-general of the Association of Asia Pacific Airlines, warned Wednesday that some airlines would not survive the worsening global economic situation.

He said the biggest challenges were weakening passenger demand, in particular first and business class travel, and uncertainty over the economic outlook.

SIA, one of Asia's most profitable carriers, said it was watching changes in travel demand.

"We are monitoring any changes in demand that may occur as a result of the deteriorating global economic position," SIA spokesman Stephen Forshaw told AFP. "We will remain nimble in the deployment of capacity going forward."