Low-cost carrier AirAsia becomes the first airline in Southeast Asia to operate the Airbus A320neo aircraft, in ensuring it remains at the forefront of the nation's aviation industry.

Powered by CFM International LEAP-1A engines, the aircraft will deliver fuel savings of 15 percent and is capable of flying an additional range capability of 500 nautical miles.

AirAsia Berhad founder and CEO, Tan Sri Tony Fernandes said, with the delivery of the youngest and most modern fleet, the technology built in the aircraft would have a very positive impact on the airline's operational efficiency and help fuel their continued growth long-term.

"Our secret is simple. Low operating cost means low fares for our passengers. The cheaper it is to fly, the more people will travel with us.

"This Airbus A320neo is capable of reducing our operational cost and we target to reduce fares up to 15 percent," Fernandes told reporters after a welcoming ceremony of the A320neo aircraft at the Kuala Lumpur International Airport (KLIA) Sepang Engineering Aircraft (SAE) hangar here Thursday.

Fernandes added that other than fuel efficiency, the environmental friendly aircraft equipped with LEAP technology means it would give an improved environmental footprint and low maintenance costs for the company.

Environmental elements installed in the aircraft where fuel savings translates into some 5,000 tonnes less carbon dioxide (CO2) per aircraft per year, in addition to the double-digit reduction in mono-nitrogen oxide (NOx) emissions and reduced engine noise.

Equipped with Space Flex Cabin for an optimal passenger comfort and efficiency, the aircraft is configured with 186 seats.

It is the airline's 172nd aircraft to be received from a total of 575 aircraft in its order book.

AirAsia is Airbus' biggest airline customer for the A320 family with 404 out of 575 are the A320neo family.

Of these, 100 units were the airline's latest firm order for the A321neo aircraft placed at the recent Farnborough Airshow in United Kingdom.

Also present at the event were Transport Minister Datuk Seri Liow Tiong Lai, French Ambassador to Malaysia Christophe Pinot, British High Commissioner to Malaysia Victoria Marguerite Treadell, AirAsia Berhad executive chairman and AirAsia X Berhad Group CEO Datuk Kamarudin Meranun, Airbus executive vice president of Strategy and Marketing Kiran Rao and CFM executive vice president Allen Paxson.