Tiger on Qantas’ tail?

Iinternational Singapore-based low fare airline Tiger Airways is seeking regulatory approval to establish a new domestic Australian airline in competition with Virgin Blue and Qantas.

The founding shareholders in Tiger Airways are Singapore Airlines (49%); Indigo Partners LLC, the investment firm founded by Bill Franke, (24%), Irelandia Investments Limited, the private investment arm of Tony Ryan, founder of Ryanair and his family (16%) and Temasek Holdings Pte (11%).

Industry analysts are suggesting that Tiger’s plans for Australian domestic flights could be a back door entry into Australia for SIA. 

Tony Ryan and Bill Frankes’, involvements also indicate a well thought out and considered strategy.

Tiger Airways has already established a successful international presence in the Australian market, operating four times a week from Darwin to Singapore, and will commence Perth-Singapore flights on March 23.

President and CEO, Tony Davis said the airline, which carried a million passengers last year, was ready to enter the market and deliver Australians genuine low fares, competing in a market which has returned to a cosy duopoly and seen tariffs rise. 

“Fares are too high in Australia and we see the opportunity to deliver consistently low fares on all our routes,” he said. 

“Unlike others in this market, we won’t be a low cost airline selling high fares, we’ll be low cost and very low fare.

“Asia has embraced the concept of genuine low fare travel and we’ve seen large numbers of people travel because of our low-fare formula. It is no surprise that our entry into the Australian market in 2005 proved so popular.

“The introduction of Tiger Airways services between Darwin and Singapore has been a major boost to regional tourism in the NT and we’re consistently selling fares on our international flights cheaper than domestic specials offered by the duopoly,” Mr Davis said.

The start of Tiger’s new service between Singapore and Perth next month is already proving popular with travellers snapping up the lowest fares available.

“Australians love our model and are supporting it already in their thousands. We are now keen to extend that model to the overpriced domestic market,” said Mr Davis.

He said Tiger Airways would change the face of airline travel in Australia by providing budget conscious travellers with affordable, efficient and reliable services.

The Tiger Airways’ business model is based on Europe’s successful Ryanair, which uses a very low cost base to deliver cheap fares.

“We certainly benefit from the experience and knowledge available to us through having the Ryan family as investors in Tiger Airways,” Mr Davis said.

He outlined the company’s plans to Federal Ministers yesterday and the airline has now commenced the process to obtain an Australian Air Operator’s Certificate (AOC). 

In addition to the application to the Civil Aviation Safety Authority for the AOC, Tiger Airways has advised the Foreign Investment Review Board of its intent to establish a new Australian domestic airline as part of the Tiger Airways Group.

Mr Davis said that Tiger Australia’s inception would create up to a 1,000 new jobs, both direct and indirect, across Australia.

Tiger had five new Airbus A320 aircraft available in 2007 and the resources ready to allocate to the Australian operation as soon as the necessary approvals have been granted, he added.