Tiger Airways still is optimistic that it can establish a joint-venture, low-cost carrier with International despite the fact that an agreement between the two has lapsed and that Thai has turned its attention elsewhere. The carrier was to have been called Thai Tiger.
The deal lapsed because Tiger and Thai were unable to get approval from the Thai Ministry of Transportation. Since then, there has been a change of government, but Thai also has been able to gain control of low-cost carrier Nok Air.
Chin Yauseng, group CEO of Tiger, says as far as Tiger is concerned, a possible deal is still on the table, but the two sides have agreed to put things on hold for a while and to return to the negotiating table later. Now would be an inappropriate time to resume talks, considering Thai Airways is busy dealing with the Bangkok floods, he adds.
Separately, Chin says Tiger’s proposed tie-up with Philippine carrier Seair has achieved a regulatory breakthrough. The country’s Civil Aeronautics Board (CAB) has lifted its cease-and-desist order against Seair’sdomestic operations. The order was imposed after some of Seair’s rivals complained that Seair’s A320 operation, which leases its aircraft from Tiger and sells its tickets through the Tiger website, was nothing more than a front for Tiger and a way for the Singaporean carrier to circumvent the Philippines’ cabotage regulations.
Since the CAB lifted its ban on Seair’s A320 domestic operations, Seair has embarked on a route network review, says Chin, referring to how Seair plans to move into some domestic routes with A320s. Tiger is also working to buy a 32.5% stake in Seair for about $6 million, but Chin could not say when the deal might close.
Tiger Airways Holdings posted a massive loss in its second fiscal quarter that it attributed to higher fuel prices and a six-week grounding of its Australian unit.
Australia’s Civil Aviation Safety Authority (CASA) grounded the carrier earlier this year over safety concerns and allowed it to resume operations in August only with a limited number of flights. Chin says it will be impossible for Tiger Australia to be profitable if CASA continues to limit it to 22 daily sectors. For the three months ending Sept. 30, the Australian operation posted an operating loss of S$50 million ($39 million), compared with an operating loss of S$11 million in the same period last year. Revenue fell 87% to $9 million from S$67 million.