Tiger Airways to bring Ryanair model to Australia

The Sunday Times, February 11, 2007


SYDNEY - Cut-price carrier Tiger Airways is likely to bring the Ryanair model of flying into cheaper, regional airports to Australia when it gets the go-ahead to operate Down Under, chief executive Tony Davis said on Sunday.

Tiger Airlines, which is backed by Singapore Airlines and Ryanair founder Tony Ryan, last week announced it had applied for government clearance to begin operating in the domestic market before the end of the year.

Mr Davis was coy on the routes Tiger will operate in Australia, saying he did not want to tip off the competition - Qantas and its budget arm Jetstar as well as Virgin Blue - but said it would amount to a 'comprehensive network'.

'At this stage we're not revealing the route network that we're going to propose,' he told ABC Television.

'We're going to keep that close to our chest for the time being but, as the regulatory process goes on, we'll be able to reveal more in the coming months.' Mr Davis said the new airline would look at flying into small centres rather than just major cities, similar to the operations of Ryanair in Europe and Tiger services in Asia.

'Well, certainly the success of people like Ryanair in Europe has been that they could go into secondary airports, to go to regional airports and really create new markets and create new opportunities,' he said.

'So, what we're looking at in Australia is that - we'll certainly look at the major cities but we're also keen to bring the advantages of low cost airfares into the regional communities.'

He said Australia, where domestic flights can be lengthy and expensive, did not have particularly low fares and Tiger would use the stripped-back approach of Ryanair to keep costs down.

'It's about having a single aircraft type, it's about operating to regional airports and getting lower fees to use those airports, and it's about giving consumers choice to purchase additional services if they require them,' Mr Davis said.

'But at its core is a very efficient and very focused business model which allows very low unit costs, and those low unit costs mean sustained and consistent low fares.'

He said the airline will have an initial investment of up to A$10 million (S$12 million) as well as five new Airbus A320s available by the end of the year, with the option of more aircraft if warranted by demand.

'We're determined to make Tiger Airways a national carrier and we'll be entering a lot of markets around the country,' he said.

Compete aggressively against Qantas

He said Tiger would compete aggressively against Qantas. 'We've been competing very aggressively in Singapore against JetStar Asia, which Qantas brought into the Singapore market, and it's probably only right and proper that we reciprocate the favour by competing aggressively and effectively here in Australia,' he said.

Tiger, which began flying in 2004, is owned by four shareholders including Singapore Airlines which has a 49 per cent stake, and Singapore investment firm Temasek Holdings with 11 per cent. Irishman Tony Ryan has a 16 per cent stake. -- AFP