Tune budget hotels set for Sydney, Melbourne

Tune budget hotels set for Sydney, Melbourne

AirAsia founder Tony Fernandes set to shake up Australian hotel market with no-frills approach
Tune Hotels
The Tune Hotel in Kuala Lumpur was the first in the chain offering bargain-basement rooms.

Complaints about the high price of holidaying in Oz are set to lose a little legitimacy with the news that Tune Hotels is about to set up shop with new budget hotels in both Melbourne and Sydney.

The no-frills hotel chain -- owned by AirAsia founder Tony Fernandes -- opened its first property in Kuala Lumpur, Malaysia, in 2007 with rooms selling for as little as US$3 a night.

Melbourne will be first Australian destination to get a Tune hotel, when a Swanson Street branch opens in August next year.

After that, Melbourne appears to be next on a hit list that’s bound to have the established hotels looking over their shoulders.

More on CNNGo: AirAsia boss announces new airline for the super rich

Tune Hotels CEO, Mark Lankester, says the company has a running start, as potential Australian guests already know the brand from trips to Southeast Asia and elsewhere.

“Because we already have so many Australian customers, expansion into [this] market makes an awful lot of sense,” he says.

“Within four years, I expect there will be at least six Tune Hotels up and running in Australia -- it would be earlier, but unfortunately getting planning permission takes a long time."

Tune’s most recent hotel was unveiled last week in London -- rooms there sell for as little as US$13 a night if booked online.

If that approach sounds at all familiar, then the concept of paying extra for everything from in-room Wi-Fi and towels to hairdryers and room cleaning shouldn’t be a surprise.

AirAsia, after all, is founded on similar principles of a basic price boosted by chargeable extras -- the classic budget airline model.

More on CNNGo: What recession? See Australia on the cheap

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