New cheap long-haul fares might not be quite the bargain they appear, writes Clive Dorman.

The contest to begin ultra-long-haul flights from Australia is escalating, with the Malaysian carrier AirAsia X likely to beat Australia's Jetstar by up to a year as the first low-cost carrier linking Australia and Europe.

However, questions remain about how price-competitive the new services will be compared with established airlines, as the low-cost carriers stack on so-called ancilliary charges for everything from online seat allocation to meals and entertainment.

AirAsia X chief executive Azran Osman-Rani last week signalled the airline's intention to start services between Kuala Lumpur and Melbourne from October and between KL and London's Stansted Airport later in the year, depending on aircraft availability. He has also indicated that the London and Australia services may not be directly linked, with up to a day's stopover required in KL in either direction.

AirAsia X is already proclaiming the success of the four weekly flights it launched last year between KL and the Gold Coast. It wants at least four more Australian destinations, including Newcastle and Melbourne.

It is in the process of playing off Melbourne's Tullamarine and Avalon airports against each other for the best deal but Azran says there are other candidates for AirAsia X's second Australian destination, which will be announced next month.

"We have had active discussions with Melbourne and remain interested to serve Victoria," Azran said. "However, other cities have put forth compelling proposals."

Azran told Traveller last year that AirAsia X wanted to link Australia and Europe with regularly available fares of about $1000 return. However, he said last week that figure will not include "taxes and charges", which typically can add up to 70 per cent to the base fare.

While it's certain there will be ultra-low promotional fares for the new service and no details have yet been given on regularly available fare levels, it's likely that total charges between Australia and the UK could amount to as much as $1700 return - only about $300 less than the best fares on the traditional airlines.

Using AirAsia X's booking system to quote fares between the Gold Coast and Kuala Lumpur, a $222 one-way fare for travel in May escalates to more than $750 return when it includes taxes and charges, as well as "options", such as $20 a piece one-way for checked baggage, $7 for a meal and $7 for online seat allocation.

This makes it difficult to compare AirAsia X fares with those of Jetstar, which also flies to KL, and charges different rates for meals and other add-ons.

Jetstar, meanwhile, is unlikely to begin linking Australia and Europe before late next year, following delays in the delivery of its new Boeing 787 Dreamliners.

And there's no guarantee that Jetstar will go head-to-head with AirAsia X with flights to London, although Jetstar boss Alan Joyce recently named AirAsia X his major international rival.

Jetstar's primary focus will be on restoring European services - to Paris, Rome and Athens - that Qantas was forced to abandon because of continuing losses. It will decide in the next few months which of its south-east-Asian hubs - Bangkok, Phuket, Kuala Lumpur, Singapore or Ho Chi Minh City - will provide stopovers for the European flights.