Tigerair Australia

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Tigerair Australia
Tigerair.svg
IATA
TT
ICAO
TGW
Callsign
GO CAT
Commenced operations 2007 (as Tiger Airways Australia)
Operating bases
Fleet size 13
Destinations 17
Parent company Virgin Australia (60%)
Headquarters Melbourne, Victoria, Australia
Key people

John Borghetti (Chairman) [2]
Rob Sharp (CEO)[3]

Website www.tigerair.com

Tiger Airways Australia Pty Ltd, operating as Tigerair Australia, is an Australian low-cost airline. It commenced services in the Australian domestic airline market on 23 November 2007 as Tiger Airways Australia. It is a joint venture between Tiger Airways Holdings, a Singapore-based company, which is owned partially by Singapore Airlines, and Virgin Australia Holdings. The airline is based in Melbourne, Victoria, with its main base at Melbourne Airport. After the 2011 CASA grounding, the airline has shut down its bases at Adelaide and Avalon and initially only operated out of its Melbourne base since returning to the air. On 7 March 2012, Tigerair announced that it will reopen a second base at Sydney Airport[4] On 4 September 2012 Tigerair announced they were resuming flights from Melbourne to Adelaide, beginning from 1 November 2012.[5] On 18 December 2012 Tigerair Australia began direct return flights from Mackay to Melbourne and Mackay to Sydney.[6] On 22 October 2012 CASA announced they were issuing a new safety certificate and lifting all restrictions placed on Tigerair Australia, as they were now satisfied they were no longer needed.[7]

History[edit]

Former Tiger Airways Australia branding

Australian government policy and legislation currently permits airlines that are 100% foreign-owned to operate domestic airline services within the country.[8] The change in regulations originally applied only to New Zealand-owned airlines in 1996,[9] but were later relaxed, resulting in the establishment of Virgin Australia. Australian international airlines are still subject to ownership rules that limit foreign ownership to 49%.[10]

A Tigerair Australia Airbus A320 wearing the new colour scheme during a turnaround at Melbourne Airport in 2014

The Australian Foreign Investment Review Board gave approval for Tiger Airways to establish its wholly owned Australian subsidiary in March 2007 without any special conditions.[11] On 16 March 2007 Tiger Airways Australia Pty. Ltd. was incorporated in the Northern Territory,[12] although the company is based in Melbourne, with Melbourne Airport being the airline's major hub.[13]

5 aircraft and A$10 million were committed to start the subsidiary.[14] The airline's business model is based on that of sister airline Tiger Airways, which attempts to increase the total market size (number of passengers), control operating costs, and maximise the number of sectors served.[15] One way it planned to keep costs low was by avoiding expensive airports.[16]

Tiger undertook the final stage of Australian regulatory procedures on 20 November 2007, successfully performing two proving flights from Melbourne to the Sunshine Coast and Launceston. Each carried officials from the Civil Aviation Safety Authority as well as Tiger crew. Tiger received its Air Operator's Certificate on 22 November.

The aircraft used by Tiger Airways Australia have the same livery as its Singapore sister company. The airline projected initial traffic of 2 million passengers annually. [11]

Tiger Airways Australia's first scheduled flight was TT 7402, which departed from Melbourne for the Gold Coast on 23 November 2007.[17][18]

On 31 May 2008 the airline announced that passengers would be charged a fee for checked-in luggage. The fee was A$10 (for 15 kg of luggage) at booking or A$20 at check-in.[19]

Tiger announced on 3 April 2009 their intention to launch in the Melbourne–Sydney market, the fifth busiest passenger route in the world, signalling an end to its operational policy of avoiding expensive airports.[20]

On 18 July, Tiger announced an increase in its Melbourne–Sydney flights by up to nine flights a day in each direction, and doubling the capacity on the Adelaide–Sydney Route. New aircraft were expected to arrive starting on 4 October 2009.[21]

On 5 November 2009 Tiger Airways announced its intention to launch into the Brisbane market with services to Melbourne, Adelaide, and Rockhampton. Tiger celebrated these routes for A$2 during their Second Birthday sale, along with all Tasmanian routes and the popular Melbourne to Sydney route. This was an extremely popular move by the airline amongst travelling Australians.

Tiger Australia announced in February 2010 that the airline was now profitable.[22]

Former MD Shelley Roberts departed on 1 June 2010. Her successor was Crawford Rix. "As far as I am concerned, on-time performance is going to be a big area that we will be focusing on," said Rix in a media interview.[23]

On 16 July 2010 Tiger Airways announced its intention to cease flying from Launceston Airport as of 2 August 2010. The Adelaide–Hobart route was also to be suspended. Communications manager Vanessa Regan said the cuts were due to seasonal demand.[24]

On 16 September 2010 Tiger commenced services to Cairns, operating a late night daily service from its Tullamarine base.[25]

On 21 October 2010 Tiger announced that it was adding two Airbus A320 aircraft to the Melbourne base in the new year, bringing its Victorian fleet to a total of ten aircraft, in line with a deal struck with the State government.[26]

Tiger announced on 25 October 2010 its intention of completing the 'golden triangle' by expanding onto the busy Sydney–Brisbane route, offering double daily frequencies.[27]

On 7 March 2012, Tiger Airways announced that it will reopen a second base at Sydney Airport[4]

On 4 September 2012 Tiger Announced they were resuming flights from Melbourne to Adelaide, beginning from 1 November 2012.[5]

On 18 December 2012 Tiger began direct return flights from Mackay to Melbourne and Sydney.[6]

On 6 February 2013 Tiger Airways Australia Announced that they would resume services between Melbourne and Sunshine Coast/Alice Springs, and begin services between Sydney and Cairns/Alice Springs.[28]

On 15 February 2013 Tigerair began its first intrastate route from Sydney to Coffs Harbour.[29]

Tigerair Australia announced they'd drop the Sydney to Mackay direct route, and instead the trip would be direct between Sydney and Proserpine.[30]

The first Tigerair Australia flight between Sydney & Proserpine took off at Sydney Airport. It arrived with a warm welcome at Whitsunday Coast Airport (Proserpine Airport) at 9:45AM. [31]

Competitors' reactions[edit]

A Tiger Airways Australia Airbus A320 at Melbourne Airport, Australia. (2007)
Interior of a Tiger Airways Australia Airbus A320 (2008)
A Tiger Airways Australia Airbus A320 fuselage showing the writing (2009)

The arrival of Tiger Airways Australia in the market resulted in varied responses from its primary competitors, mainly Qantas (and its subsidiary Jetstar Airways) and Virgin Australia. Jetstar was particularly vocal, with its then chief executive Alan Joyce quoted as saying "Tiger and what they have done have come across as a joke, and will probably continue that way".[32] He claimed that Tiger was losing over SGD$60 million over the previous two years of operations out of Singapore.[33]

Air fares began to drop as special offers and other promotions were launched, such as Jetstar's announcement that it would "double the difference of any competitor's fare that is cheaper than its own fares".[34] This was soon followed by a bonus system to entice its customers to stay with the airline.[35] Jetstar immediately matched Tiger's Melbourne to Darwin fare upon its announcement.

Tiger Airways Australia had previously been quoted as planning to offer "single digit" one-way fares when it began service. The announcement of A$79.99 flights from Melbourne to Darwin was met with criticism from Jetstar.[36]

When Tiger released its first route—Melbourne to Darwin—at a price of A$79.99, Jetstar immediately undercut the price, offering fares of A$79 on the same route over the same period. When Tiger released its second route—Melbourne to Gold Coast—at a price of A$49.95, Jetstar again undercut the price, offering A$39 fares on the route over the same period. In response to Tiger's announcement of Melbourne to Launceston flights for A$39.95, Jetstar offered A$29 flights over the same period, except for a holiday blackout.

Virgin Australia considered the possibility of establishing a low-cost offshoot to fend off Tiger Airways,[37] but decided to focus on its new trans-Pacific carrier, V Australia, and on increasing their business travel share by introducing a Premium Economy service.

In a bid to increase its share of low-cost traffic, Melbourne Airport announced plans to cut usage fees soon after Tiger's announcement of establishing a hub there.[38] Tiger's mention of New Zealand as a potential market raised concerns in that country.[39]

Just days before the launch of Tiger Airways Australia, Jetstar offered 5,000 seats on 21 November 2007 for the price of five cents, inclusive of taxes, on seven domestic routes, costing the airline $25.00 per seat. Jetstar claimed that the sale has nothing to do with the Tiger launch, while at the same time referring to them as "competitive". The airline's spokesman, Simon Westaway, was quoted as saying that they "are a good airline in their own right. We are not going head to head. We respect them for the competitor that they are going to be".[40]

On 23 November 2007, the airline criticised Qantas for being unable to provide ground handling services to the airline at Alice Springs Airport, forcing it to delay its launch to the city by three months to 1 March 2008. The airline had promised to pay any cost to Qantas, but services were still denied. Qantas executive general manager John Borghetti responded by saying "assisting competitors is not part of my job description".[41] Tiger Airways Australia CEO Tony Davis reminded Qantas that Tiger's parent, Singapore Airlines, provides ground servicing at Singapore Changi Airport for both Qantas and Jetstar, and it wasn't unreasonable for Qantas to provide Tiger the ground staff at Alice Springs.

Tiger commenced service to Adelaide from Melbourne on 10 January 2008. Fares of $9.95 one-way between Melbourne and Adelaide were offered a few days prior to the launch.

Tiger Airways Australia celebrated its first anniversary on 19 November 2008 with a "Free Seats" campaign, which resulted in 100,000 seats on sale, of which half sold out within the first few hours.[42] The airline celebrated its second birthday on 23 November 2009 with thousands of seats on sale for A$2.

Company affairs and identity[edit]

Ownership[edit]

Tiger Airways Australia Pty Ltd is a wholly owned subsidiary of Tiger Airways Holdings Limited, which is publicly listed on the Singapore Exchange.

On 30 October 2012, Virgin Australia announced it was proposing to purchase a 60% stake in Tigerair Australia for $35 million. Tigerair and Virgin said they would spend up to $62.5 million on Tiger Australia to increase its fleet from 11 aircraft to 35 by 2018. [43] Tiger would continue to operate as a low cost subsidiary of Virgin Australia for 20 years.

On 23 April 2013, the ACCC announce that they would not oppose the merger. ACCC chairman Rod Sims said that Tigerair would be "highly unlikely to remain in the local market if the proposed acquisition didn't proceed".[44]

Performance[edit]

The latest airline statistics for the 2012-2013 year show that of the major Australian domestic airlines (Qantas, Jetstar, Virgin Australia, Tigerair), Tigerair achieved the second lowest level of on time departures for 2012-13 at 79.6%, a significant drop from 2011-2012 figure of 89.5%, but ahead of Jetstar at 75.6%. This result was also reflected in arrival performance, where Tigerair achieved an on-time arrival rate of 76.3%, ahead of Jetstar at 76.1%. In the same period for the major domestic airlines, Tigerair had the lowest cancellation rate for the 2012-2013 year, at 1.2% of flights cancelled.[45][46]

2011 warnings and suspension[edit]

On 11 February, erroneous data was suspected to have been put into a flight computer.[47]

On 3 March, a traffic collision avoidance system alarm was triggered after a Tigerair plane flew too close to a smaller aircraft.[47] Following this, Tigerair was issued with a "show-cause" notice for pilot training and maintenance. Spokeswoman Vanessa Regan told news media that "There is no cause for concern.[48] CASA [the Civil Aviation Safety Authority] has taken no action. We continue to operate and we want to reassure our customers that there is no risk to safety and we continue as normal".[49]

On 20 April, another Tigerair aircraft flew below the published minimum altitude near Melbourne Airport.[50]

On 7 June, another Tigerair aircraft again descended below the minimum altitude near Avalon Airport.

On 1 July, a further Tigerair A320 from Brisbane to Melbourne flew too close to a Boeing 767.[47]

On 2 July, Tigerair Australia was suspended from flying by CASA due to "various" safety concerns.[51][52][53] The grounding coincided with school holidays in New South Wales and Victoria. News agencies estimated that 35,000 people may have been affected.[54] It is estimated that Tigerair will lose A$4.2 million for every week of suspension.[47]

Special conditions were imposed on its Air Operator Certificate giving Tigerair 60 days from mid June to complete instrument rating renewals. This direction was extended to all of its pilots.

A spokesperson for CASA, Peter Gibson, told the media that "Tigerair has not been able to, at this stage, convince us that they can continue operations safely, so that's why they're on the ground". Citing a view that future problems would also occur, he also commented that "We [CASA] believe this is symptomatic of problems within the airline [and] we've put them on the ground while we consider all these issues".[55]

Tigerair stated that it was co-operating fully with CASA.[48]

On 6 July, CASA announced that it would lodge a request for extension to the suspension until 1 August at the Federal Court in Melbourne, while CASA continued to investigate, after the investigation raised more questions into Tiger Airways Australia, and until CASA was satisfied that the airline "no longer poses a serious and imminent risk to air safety".[56][57] Consumer regulators, such as the Australian Competition and Consumer Commission (ACCC), warned Tigerair Australia that the airline needed to inform customers who purchased tickets about the uncertainty as to whether the airline would be flying from 9 July.[57] Tigerair Australia suspended its ticket sales on 5 July, however the ACCC's chairman, Graeme Samuel, stated that Tigerair Australia's "lack of response until that point was far from satisfactory".[57]

After five weeks CASA lifted the ban and Tigerair Australia recommenced operations on 12 August, but only for 18 flights a day between Melbourne and Sydney. Tigerair announced it was suspending operations from Avalon Airport and would close its Adelaide base altogether in a "commercially motivated" decision. It also said that it would reduce its fleet to eight aircraft.[58][59][60]

On 22 October 2012 CASA announced they were issuing a new safety certificate and lifting all restrictions placed on Tigerair Australia, as they were now satisfied they were no longer needed.[7]

Marketing[edit]

The Air Ways TV series created by the Seven Network follows the day-to-day operations of the airline.[61] It has a similar premise to the successful UK factual television series Airline. The series, while not always portraying Tigerair in a positive light, does much to promote the airline.

Tigerair launched a new advertising campaign in December 2009 named "The Low Fare Revolution".

Destinations[edit]

A Tiger Airways Australia Airbus A320 at Adelaide Airport, Australia. (2010)

Expansion of bases[edit]

On 7 March 2012, Tigerair Australia announced that it will reopen a second base at Sydney Airport[4] On 4 September 2012 Tigerair Australia announced they were resuming flights from Melbourne to Adelaide, beginning from 1 November 2012.[5] On 18 December 2012 Tigerair Australia began direct return flights from Mackay to Melbourne and Mackay to Sydney.[6]

Fleet[edit]

As of May 2014, the Tigerair Australia fleet consists of the following aircraft:[62]

Tigerair Australia Fleet
Aircraft Current Orders Passengers
Airbus A320-232 13 10[63] 180

Onboard services[edit]

The airline provides the free Tiger Tales inflight magazine and a buy on board programme serving snacks, soft drinks, beer and wine for purchase.[64] In June 2010, Tigerair implemented a "cashless cabin" environment, in that it only accepted Visa or MasterCard for onboard purchases. This new method was later dropped.

Satisfaction[edit]

In the Roy Morgan Single Source quarterly sample of 1896 Australians Tigerair Australia has staged a dramatic turnaround in customer satisfaction levels. Customer satisfaction with Tigerair Australia rebounded from below 40% in June 2012 to 64.6% in September 2012, representing a dramatic turnaround for the airline, according to Roy Morgan Research. Its satisfaction levels now sit just below low-cost carrier competitor Jetstar which boasts 65.7% satisfaction among customers.[65]

See also[edit]


References[edit]

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  2. ^ Evan, By. (2013-07-08) Tiger air becomes part of Virgin. News.com.au. Retrieved on 2013-07-16.
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  29. ^ http://www.tigerairways.com/news/TT_20121126_20121125.pdf
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  31. ^ http://www.whitsundaytimes.com.au/news/first-flight/2218190/
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  63. ^ [1][dead link]
  64. ^ "Inflight menu". Tiger Airwways Australia. Retrieved 6 July 2011. 
  65. ^ Australia, MarketingMagazine. "Airline customer satisfaction: Tiger stages dramatic turnaround, Qantas flounders". MarketingMagazineAustralia. Retrieved 30 October 2012. 

External links[edit]