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Tiger Airways
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Tiger Airways Private Limited is a low-cost airline based in Singapore, with its primary hub at Singapore Changi Airport. Incorporated in September 2003, it is currently the largest low-cost airline operating out of Singapore in terms of passengers carried. In 2006, the airline flew 1.2 million passengers, a growth of 75% from the previous year.
The airline was the first to operate from the Budget Terminal in Changi Airport in order to achieve operating-cost savings and its cost structure is modelled after Ryanair.
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Encyclopedia
Tiger Airways Private Limited is a low-cost airline based in Singapore, with its primary hub at Singapore Changi Airport. Incorporated in September 2003, it is currently the largest low-cost airline operating out of Singapore in terms of passengers carried. In 2006, the airline flew 1.2 million passengers, a growth of 75% from the previous year.
The airline was the first to operate from the Budget Terminal in Changi Airport in order to achieve operating-cost savings and its cost structure is modelled after Ryanair. Despite regional competition, the airline has reiterated its current intention to remain focused on flying within a five-hour radius from its Singaporean base. To overcome regulatory hurdles in the region, the airline attempts to buy into regional carriers to expand into a pan-Asian carrier.
Flights to India started in October 2007, and expansion to Malaysia is planned.
Former plans to establish a hub in Manila (Clark) have been suspended.
Group consolidated profit improved by S$24.7m from a loss of S$14.8m FY 31 March 2007 to a profit of S$9.9m FY 31 March 2008.
History
The airline was incorporated on December 12, 2003, and began ticket sales on August 31, 2004. The airline flew into a period of relative difficulty for the aviation industry with rising oil prices and intense competition from other airlines. The airline held off imposing fuel surcharges as its competitors have done.
With Singapore Airlines having a stake in the airline, it is noted that the airline occasionally fills in the gap when SIA drops its services from certain destinations. Macau, once served by SIA before being taken up by its subsidiary, SilkAir, in 2002, terminated all flights completely by the end of 2004. Three months later, the route was taken over by Tiger Airways with flights commencing 25 March, 2005. A similar pattern can be observed in Krabi, where SilkAir suspended services in February 2005 in the wake of the effects of the 2004 Indian Ocean earthquake. Tiger Airways resumed direct services to the location from 7 October, 2005.
In late July 2005, it was announced that the airline would commence flights from Macau to Manila (Clark) on October 30, 2005, a much-heralded move as it may signal the establishment of a secondary base besides Singapore, allowing the airline to expand and diversify risks.
On September 21, 2005, the company produced a report card on its first year of operations, with a total of over 500,000 passengers carried, 5000 scheduled flights flown, and a flight completion rate of 98.7 per cent. 94 per cent of flight departures and 90 per cent of arrivals took place according to schedule. It acquired four aircraft and launched a total of nine routes - of which four are flown exclusively by the airline - during the year.
The airline expects to increase its fleet to nine Airbus A320 aircraft by end 2006, and to carry up to three million passengers a year by then. It also hopes to add six more routes during the year, primarily to destinations in China and India, with flights to Southern China having commenced April. The airline also announced its switch from Singapore Airport Terminal Services to Swissport for ground handling when it becomes the first airline to operate at the newly-opened Budget Terminal in Changi Airport on March 26, 2006.
Tiger Airways became the first Singaporean low-cost carrier to receive operating permits from the Chinese aviation authorities to fly to the southern Chinese cities of Haikou, Guangzhou and Shenzhen in an announcement on February 21, 2006. Ticket sales to these destinations commenced 24 February, 2006, with the first flight to Shenzhen taking place on April 15, to Haikou from April 26 and to Guangzhou from April 27, 2006. The airline has since indicated that the routes were highly popular, with increased flights to Haikou and Guangzhou less than three months since their launch.
In June 2006, flights to Danang were suspended. On July 20, 2006, the media reported on the airline's intentions to increase its routes from 15 to 20 and to establish a second base city by the end of the year. Possible growth regions include China, Southern India, Cambodia and Brunei. The airline's plans for a possible initial public offering was also revealed. At the same time, it announced that it saw an increase of 81 per cent in passengers carried in the months of April to June since its move to the Budget Terminal in March, compared to the same period in the previous year.
A planned tie-up with South East Asian Airlines was held up by the Civil Aeronautics Board of the Philippines. The board finally approved the proposed tie-up despite protests from other Philippine airlines, but , there has been no further progress. On November 15, 2008, Tiger terminated its flights from Manila to Macau.
Tiger started services from Singapore to Perth on March 23 2007.
Tiger Airways Australia
On February 9, 2007, Tiger Airways formally announced that it hoped to become Australia's third full-scale domestic airline, competing directly with Virgin Blue and Qantas/Jetstar. Tiger Airways Australia will use their Australian domestic network to support an expanded international presence with the current gateways of Darwin and Perth, expanded to include Melbourne. On March 16 2007, the airline received approval from Australian authorities to establish the new subsidiary, and established Tiger Airways Australia Pty Ltd on the same day.
Tiger Airways Australia began operations on November 23, 2007, and its current route network already spans across every state and territory in the country (except NSW, Sydney airports fees are too high to justify the low cost model servicing Kingsford Smith). On July 31, 2008, Tiger Airways Australia announced that it would suspend its flights from Darwin on October 25, citing Darwin International Airport operating and fuel costs, making it the most expensive airport on the Tiger Airways Australia network but did not rule out returning in the future if costs were to decrease. On 5 August 2008, the airline announced Adelaide as its second operational base.
Incheon Tiger Airways
On November 5, 2007, Tiger Airways announced that it would be starting a Korean-based budget airline. Incheon Tiger Airways was to have been a joint venture between Tiger Aviation and Incheon Metropolitan City, flying to destinations in Japan, China, Mongolia and the Russian Far East. The airline was to be based in Seoul's Incheon Airport and planned to begin services by 2009; however, the project was abandoned in December 2008.
Corporate management
Tiger Airways is wholly owned by Tiger Aviation, a holding company set up in 2007 to manage both Tiger Airways and start-up Australian subsidiary Tiger Airways Australia. Tiger Airways' founding shareholders were Singapore Airlines (49%), Bill Franke's Indigo Partners (24%); Tony Ryan's Irelandia Investments (16%) and Temasek Holdings (11%).
The airline plans to study the possibility of an Initial Public Offering by the end of 2007.
The airline has reported losses in every financial year since its founding, although it may report its first profit in the year ending March 31, 2008. It reported a loss of S$37.4 million (turnover at S$75 million) in the year ending March 31, 2006 and S$14.3 million (turnover S$171.2 million) in the year ending March 31, 2007. Profitability was recorded at S$37.8 million (revenue S$231 million) in year ending March 31, 2008.
Destinations
Tiger Airways currently flies to destinations within an approximate five-hour radius around Singapore to 19 destinations in eight countries around the region. Thailand is its first and biggest market, with four cities served, taking advantage of the open-skies agreement between Singapore and Thailand. Current aviation agreements have prevented the airline from flying to neighbouring Malaysia except Kuala Lumpur (starting February 2008), although in September 2006, it was granted rights to fly to Kuching, Miri and Sibu in a bid to boost tourism in Sarawak.
Future plans include:
- Increasing the number of aircraft in its fleet to 20 by 2010.
- Singapore -Bandar Seri Begawan, Singapore -Pontianak, Singapore-Sibu, Singapore-Miri
- Tiger Airways plans to deliver more domestic Australian routes, competing with Qantas, Jetstar, Virgin Blue and other regional airlines. It recognised this gap in the market for truly cheap fares as Virgin Blue, also a low-cost carrier, has improved its services for business travellers, as well as opening lounges and introducing a frequent-flyer scheme; therefore, operating a dearer business model.
- Tiger Airways has gained approval from Indian authorities to start flying to four more cities in India (Goa, Trivandrum, Kolkata and Kozhikode), and has started flights to Chennai and Bangalore.
Fleet
The airline operates a single-model fleet consisting of the Airbus A320-200 aircraft powered by V2500 International Aero Engines. All aircraft offer single-class economy seating for 180 seats each.
The first aircraft order comprised four aircraft, commencing operations with two aircraft before the remaining four were delivered in January 2005. A second order for an additional eight to be delivered between March 2006 and 2007 was made in June 2005, with the Royal Bank of Scotland helped finance the four of the aircraft in the second order, worth a total of about US$500 million.
There are currently nine aircraft in its fleet after the latest delivery of two aircraft in April 2006, a third on 11 October 2006, a fourth aircraft 9V-TAH on 23 November 2006, and a fifth aircraft 9V-TAI on 14 December 2006.
In July 2006, the airline announced its first sale and leaseback agreement with GATX Air for two aircraft due for delivery in October 2006 and November 2007 respectively. It also announced its intentions to exercise its options for eight additional aircraft for a total of 20 planes.
On October 17, 2006, the airline confirmed its purchase options for another eight aircraft to be delivered between 2008 and 2010 in a deal worth S$780 million. The purchase was expected to help the airline enter its next expansion phase. On January 4, 2007, Tiger announced that it had secured a US$100 million pre delivery deposits facility from the French bank, BNP Paribas to finance this purchase.
On June 21, 2007, the airline announced it had signed a letter of intent to purchase a further 30 aircraft worth US$2.2 billion, with another 20 on option. These would be delivered between 2011 and 2014.
On October 10 2007, the airline confirmed the letter of intent signed in June for the purchase of 30 aircraft with 20 more on option. The aircraft are scheduled to be delivered between 2011 and 2014. The new aircraft will be deployed in Tiger Airways' Asia-Pacific network and the domestic operation in Australia.
On December 18, 2007, the airline announced that it had taken up the options and this increased the number of Airbus A320s ordered by the airline to 70.
On March 6, during a speech to the Australian National Aviation Press Club, chief executive officer Tony Davis said that the airline would take two Airbus A319s to enable it to fly into smaller Australian airports.
As of the end of 2008 the Tiger Airways fleet consists of the following aircraft:
Tiger Airways Fleet (Singapore operations only) | Aircraft | In fleet | Order | Option | Engine | Seat Configuration | Routes | Notes |
|---|
| Airbus A320-232 | 9 | 57 | 0 | IAE V2527-A5 | 180 (Y180) | Short haul | Aircraft ordered will be deployed among Tiger Aviation Group of subsidiaries. | | Airbus A319-132 | 2 | 0 | 0 | IAE 2524-A5 | 180 (Y180) | Short haul | Aircraft ordered will be deployed among Tiger Aviation Group of subsidiaries. | |
In-flight
Food and Beverage Options
Tiger Airways offers food and beverages available for purchase as part of a buy on board programme. The menu offers light meals such as instant noodles, soups and sandwiches. Hot and cold beverages as well as liquor are also available for purchase.
Entertainment
As of December 2007, there is no free in-flight entertainment provided on board Tiger Airways flights; however, passengers can pay S$15 for the use of an in-flight video player which can be used for the duration of that flight. An in-flight magazine, Tiger Tales, is provided as free reading material for passengers.
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