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New Tigerair CEO on the way after losses mount

written by australianaviation.com.au | May 8, 2014
Tigerair continues to record losses in its Asian and Australian markets. (James Morgan)
Tigerair continues to record losses in its Asian and Australian markets. (James Morgan)

Singapore-based Tigerair is to have a new CEO after reporting a net loss of SG$223m (A$191m) in the year to March 31, a five-fold increase over the previous corresponding period.

As a consequence, the budget airline, which is 40 per cent owned by Singapore Airlines, has moved to replace CEO Koay Peng Yen – who has only been in the job since mid-2012 – with long-time Singapore Airlines executive Lee Lik Hsin from May 12.

Even though Tigerair has operated as a separate entity to its major shareholder, Singapore Airlines is reportedly looking to better align Tigerair with its other brands and to push for it to expand further into the Asian market.

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“The [Singapore Airlines] group will align all these airlines so as to have a coherent strategy going forward,” aerospace consultant Sagar Ashok told Reuters. “So each airline benefits from the other airline and they really don’t compete on routes, have flight schedules which go hand in hand with the other airlines and things like that. They’ll try to see where Tiger fits into all this and make better sense of what is happening and how different they can go forward in that particular segment.”

CAPA Centre for Aviation reports Tigerair will be restructured as it seeks to turn around the losses, and says the Singapore market currently has excess capacity resulting in lower yields and load factors. That same excess capacity has also seen Qantas halt growth at its Singapore-based Jetstar Asia subsidiary of Jetstar.

Local franchise Tigerair Australia, which is majority-owned and controlled by Virgin Australia and largely operates autonomously from Singapore-based Tigerair, also continues to be unprofitable, with a loss of SG$5.4m (A$4.62m) attributed to it in the quarter, taking its losses for the year to March 31 to about SG$14m (A$12m).

CAPA says Tigerair Australia is on a “growth path” after a period which saw it grounded and then partnered with Virgin Australia, but added that “challenging market conditions in Australia” will continue to hamper those efforts.

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7 Comments

  • IAN

    says:

    Why doesn’t Tiger fly to places like Invercargill in NZL ? It’s only 100 clicks from Queenstown.

    They could do it on a charter basis. Queenstown seems to be booming & Tiger could do red eyes out of places like BNE & MEL that have no silly curfew.

    Flight Centre in BNE has run adverts in BNE Sunday Mail last 2 Sundays that said

    ZQN from only AUD$763 return. That’s a good yield if you can get it, so people must be looking for cheaper alternatives.

  • John

    says:

    Couldn’t Tiger operate some thinner routes for Virgin ? Virgin have a few A320 (SkyWest) so they must have an AOC covering A320’s.

  • Sarah

    says:

    Virgin has transferred some SYD/OOL capacity to Tiger, so why not internationally like Fiji etc, even red eyes in peak season.

    FYI FJ operate red eyes BNE/NAN 3-4 time a week & all FJ MEL/NAN flights are red eyes.

    Maybe only in peak season when never enough flights.

  • ma

    says:

    We would charter a Tiger airbus A320 if we could, but they don’t seem like they want to. Must be plenty of Tiger aircraft parked around Australia every evening.

  • vb

    says:

    Yes flights to ZQN are very high out of places like BNE in school holidays, but there’s still plenty of good 4.5 star accommodation in school holidays from just over $100/night/room including breakfast.

    Fares from $763 BNE/ZQN/BNE seem crazy when you can fly BNE/LAX/BNE (not via China) for $1091 or a little more for QF/VA.

  • qb

    says:

    yes we tried to charter Tiger A320’s for a once a week 10-13 week op & we’d even consider red eyes, but got no response. Is Tiger Australia short of crews ?

    If so, surely they could get foreign crews from other part of Tiger perhaps ?

  • Joseph

    says:

    Yes I think if you ask Tiger can they do charters over a route that’s even vaguely similar to a VA/NZ route, they’ll either give a stupidly high price or say they can’t do it.

    Having worked in UK where we did hundreds of charter flights to Europe every year, know there can be good revenue for airlines doing charter flights.

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