A NEW air service from the North-East to Dublin will begin in the new year - with a starting return price of just £39.

That was the announcement from Gill Airways last night who reaffirmed details of the launch of its new service from Newcastle to the Irish capital, despite the threat of what it has described as "unwelcome competition" from British Airways.

Gill will mark its entry on the route with the cut price fares in January only. The lowest fares will rise to £59 in February and March, and £79 thereafter.

Chief Executive of Gill, Malcolm Naylor, said: "We were disappointed to hear so soon after we announced our service that British Airways was yet again intent on squeezing one of the few remaining independent airlines still flying.

"However, our decision to enter this market was based on the knowledge that we could bring increased frequency and improved reliability at more affordable fares than previously available.

"The fact remains that where we do compete with BA, we offer the best fares and the best reliability."

The airline, which employs 350 staff at its Newcastle Airport base, is set for an imminent return to financial independence.

The company, which is the North-East's only commercial airline, went into administration in February this year due to financial problems, following the company's own application to the High Court.

Last month it announced plans to take over the Dublin route from the Irish national carrier Aer Lingus.

Gill will offer three flights daily, Monday to Friday, with one on Saturdays and two on Sundays. Its timings are geared primarily to the key business market that exists between the two cities.

BA revealed soon after Gill's announcement that it too intended to operate the Newcastle to Dublin route, using its wholly owned subsidiary Brymon Airways.

BA has been the target of repeated criticism from Gill for what it describes as "muscling in on markets that have been built up by the Newcastle-based airline". The Gill service will operate with 66-seat ATR 72 aircraft, with a journey time of one hour 15 minutes