Low-cost newcomer Tiger steps up plans

The Straits Times, March 2, 2007
Steve Creedy, Aviation writer



TIGER Airways has brought forward plans to fly daily services to Perth as a strong response to its proposed Australian operation has led to a flurry of meetings with airport operators and state governments.

The Singaporean carrier accelerated plans to start daily services to the West Australian capital by six months.
It will now begin the beefed-up service in May instead of November.

Chief executive Tony Davis said the increase was necessary because of the overwhelming response to the airline's low fares on its four weekly flights due to start on March 23.

Mr Davis was also forced to extend a planned visit this week from one day to three days, to cope with the demand from airports and states wanting to host Tiger's new Australian base.

"The good thing is we're talking to all of the major airports in Australia, and we're talking to a number of the smaller regional airports as well, in terms of a base for aircraft and also including those airports as a destination in the network," Mr Davis told The Australian.

"I think that people, both at an airport level and a state level, are interested in job-creation opportunities and economic benefits we will bring to the local economies through the operations of the airline and through things like maintenance support, catering and ground handling."

Tiger has been surprised by the strength of the interest in its start-up, saying it has been inundated with job applications, and that an online voting facility on potential Australian destinations generated 35,000 votes in the first 14 days. It is now in the process of appointing Australian nationals from its existing workforce to the team that will work with regulators on the airline's Australian air operator's certificate approval.

But the Tiger chief said the initial focus was on deciding a route network and where the airline's base was going to be.

"Clearly this is an important step ... so that everyone ... will know where they will be working from. So the priority is to meet with the airports and state representatives this week."

Tiger will launch with five Airbus A320 aircraft and estimates it could attract up to 2million passengers a year.

Mr Davis said it would be best to put all five aircraft in a single base but the aircraft could be split over two bases.

He said suggestions Virgin Blue could start an ultra-low-cost airline - a world first - was verification of Tiger's position that that there were no true low-cost airlines in Australia.

"Jetstar is very much a wedded and integral part of the Qantas Group and Virgin Blue has made it clear that it's drifted away from its low-cost ancestry into a network carrier," he said. "So there is an opportunity for a genuine low-cost airline to make a new market segment in the domestic Australian market."

However, Tiger may find itself facing a beefed-up Jetstar.

Officially opening the Qantas subsidiary's $29 million national aircraft maintenance facility in Newcastle yesterday, Jetstar chief executive Alan Joyce confirmed the airline would seek board approval to acquire additional A320 aircraft to support growth plans on new and existing markets.

Mr Joyce said the facility, which created 50 new engineering jobs, would support the existing and future narrow-body aircraft maintenance needs as well as third-party engineering work from other operators.

The Newcastle facility beat other Australian and overseas competitors to secure the Jetstar maintenance and has also won third-party work on six Boeing 717s used by Qantaslink.

"We will not rule out pursuing further third-party aircraft maintenance work in Newcastle for similar type jet aircraft if we remain cost-competitive," Mr Joyce said.