Woo-Hoo! Another airline bases itself outside of SYD! (Merged)

[Buster Hyman]

Fares to fall as city sinks its claws into Tiger

Mathew Murphy

May 3, 2007


MELBOURNE will become the Australian home of budget carrier Tiger Airways, in a decision set to create hundreds of Victorian jobs and spark a price war.
The Singapore Airlines-backed carrier will today announce plans to establish its headquarters at Tullamarine. Avalon Airport is believed to have been overlooked because of its distance from the CBD.
The decision will set off a discount price war in the domestic airline market with Tiger promising to beat the prices set by Jetstar and Virgin Blue.
Jetstar pre-empted the announcement this week by selling 30,000 domestic route tickets at $3 each to its customers.
Sources confirmed to The Age that Melbourne's bid was considered superior to the other states. Melbourne had been in a "neck-and-neck" race with Brisbane to secure Tiger.
"It has been decided, Tiger will be let out of its cage in Melbourne," one source said.
Today's announcement will provide sweet revenge for Melbourne after it lost out to Brisbane in its bid to secure Virgin Blue's headquarters in 2000.
The decision, expected to be announced by Tiger's chief executive, Tony Davis, will create at least 1000 jobs in Victoria, with the airline believed to be scouting for pilots and cabin crew across the state.
Tiger, which is 49 per cent owned by Singapore Airlines, will require space at Tullamarine to house five aircraft. The fleet is expected to grow to about 20 in the years ahead. Virgin Blue operates with about 50 planes; Jetstar has about 25.
Melbourne Airport would not comment on the decision but confirmed it had "plenty of room" at Tullamarine for Tiger.
It is expected Tiger will initially offer services from Melbourne to Sydney, Brisbane, Canberra and Adelaide.
As part of Jetstar's promotion, it also began offering from midnight last night 100,000 tickets for $3 for domestic flights and tickets to Honolulu, Bangkok and New Zealand during restricted times with the purchase of another Jetsaver fare.
The "take a friend" promotion meant seats for selected flights and times in June, July, October and December allowed a second seat on the same flight for $3.
The airline could be ready for take-off in the domestic market within months. Before that happens it needs to obtain its Air Operators Certificate from the Civil Aviation Safety Authority.
A spokeswoman from CASA said Tiger's application had been received but declined to say where the process was at.
Three weeks ago, CASA said it had not received a formal application by Tiger and that it could take up to five months to process an application and issue a licence.
The airline has been given approval by the Foreign Investment Review Board to establish an Australian subsidiary.
It is not known what incentives the State Government offered Tiger but it has been lobbying hard to woo Tiger to Melbourne. The Government refused to comment on whether it knew about the airline's decision.
Sir Rod Eddington, the former chief executive of Cathay Pacific, Ansett and British Airways and now head of the Victorian Major Events Company, said the decision was "a real coup for Victoria".
With DANIELLA MILETIC

Yes, sweet revenge indeed! All over town people were high fiving each other!:rolleyes:

[lowerlobe]

Buster..I had to check and make sure it was not April 1st....LOL

Congratulations on the news although I think Melbourne was a shoe in because Brisvegas has not got electricity on yet.

But you guys really have to get some outside interests apart from Bonnydoo and Phillip Island if you were high fiving each other because of this...:E :E

[soldier of fortune]

===what a bunch of loser's===:yuk: :yuk: :yuk: :yuk:

[Buster Hyman]

I hope you're referring to me...I really like the irony of being called a loser, by someone whose nickname is Soldier of Fortune!
http://www.clicksmilies.com/s1106/lachen/laughing-smiley-014.gifhttp://www.clicksmilies.com/s1106/lachen/laughing-smiley-014.gifhttp://www.clicksmilies.com/s1106/lachen/laughing-smiley-014.gif

Actually Lobee...it might've been for the rain...:confused:

[YesTAM]

Jetstar pre-empted the announcement this week by selling 30,000 domestic route tickets at $3 each to its customers.

Thats predatory pricing, I hope the ACCC nails Jetstars ears to the wall.

[bizzybody]

i did a search on the casa sitean their aoc is up there.
I actually saw it 2 weeks ago and i thought it happened all very quick

[metrosmoker]

It`s not predatory pricing.
Predatory pricing is where two entities conspire to price out another. Now if Qantas start a $3 'sale', then the ACCC will have to investigate. If Virgin did it, then there might be a case also. However given how much they hate each other, both companies should be able to get away with it.
But they have classed it as a sale. And as there normal marked price is still the same, ACCC can sit in there office and continue to do nothing.

Another question. Why should an overseas operator be given any kind of special treatment or assistance? Compass, Impulse, Ozjet, all owned by Australian`s. I don`t remeber the ACCC helping anyone of them out in anyway. Bashing the Qantas group just for the sake of it is getting a bit tiresome. They are after all, an Australian company, atleast for the time being.

[tinpis]

Darwhine is gonna be used as a hub whatever that means :uhoh:

[Yusef Danet]

'smoker

I believe that one operator can engage in predatory pricing against another, and this industry has shown it before.

Remember a stoush between Qantas and Virgin Blue regarding the Adl-Bne route many years ago? As usual, the ACCC finding arrived so late that the issue was no longer relevant, and the penalty was a strict instruction not to do it again.

[B772]

bizzybody. The AOC you have seen is for Tiger - Singapore. All foreign operators operating into Australia require an Australian AOC.

There will be a seperate AOC for operations within domestic Australia.

[jack red]

When I see petrol prices going down at the pump two days before a long week end and on Thursday mornings, THEN and ONLy THEN shall I have confidence in the ACCC ensuring there are no anti-competetive practises in the aviation industry !:mad:

[wessex19]

we booked 2 return flights today with Jetstar, Sydney to Vietnam for September for $915 including all taxes. Cheap as chips!!!!

[Flight Detent]

I see this entry of Tiger into Australia's domestic aviation scene as one that will follow the likes of Virgin Blue.

Firstly starting off as just a domestic operator, then after a while, will expand into the international routes, then operate (amongst others) the sort after Australia to West Coast USA.

Now isn't that what they (being Singapore Airlines) were after all along?

Cheers FD :D

[727ace]

seems the AAES/John Holland venture will get another A320 contract and the Phoenix will rise from the ashes finally!!!:rolleyes:

[Buster Hyman]

Yes. I wonder how much Romulus can reveal about that?;)

[babyslug]

Wow, $3.00 airfares, how good is that. Jetstar is a player. Just as well the big Q has deep pockets to keep them propped up. Lets hope bigger than Singapores.

[aircabbie]

wessex check PMS

[Romulus]

Yes. I wonder how much Romulus can reveal about that?;)

Not much. We'll continue to do whatever we can to make it work for them. If there's one aircraft type AAES/JHAS is set up for more than any other the A320 is it.

[gramps]

Anyone know what they are offering tech crew?

[Buster Hyman]

Ahh...as in, was the impending purchase of AAES and a nice big A320 hangar a potential carrot to Tiger?

;)

[Mr. Hat]

Good question gramps, but the one i'm after is: a320 or possibly 73?

Anyone.

[The Kavorka]

And the race to the bottom continues!!!!!!!!!!!11:mad: :ugh:

I'm interested as to why Tiger want to come here anyway.

The couldn't really expect to make money competing against VB, QF and J*.

I wonder how long they will suffer a loss for?

As for tech crew, i doubt many guys will leave any Aus carriers to work for them not knowing how long they will last...especially with the track record of other airlines that have tried!!

I really do believe they are better off investing their money else were, asia seems to be growing quickly....

[Cactus Jak]

Can anyone confirm or deny the following -

1. John Holland has Singapore interests or visa versa
2. Singapore Airlines has a strangle hold on terminal gates at Melbourne airport that are currently being used by VB.

[jack red]

As for tech crew, i doubt many guys will leave any Aus carriers to work for them ...............

Would you like a case of Fosters on that Kavorka?

I know two Jetstar Captains and three Virgin Blue pilots who put their EOIs in 4 months ago.;)

[Romulus]

Ahh...as in, was the impending purchase of AAES and a nice big A320 hangar a potential carrot to Tiger?

We'll do everything we can to win profitable Tiger work and if we help to bring them to Tulamarine so much the better.

[727ace]

if and when it happens will type training and PCT be available for those of us out there without A320 in book and lucky enough to get a slot at JH

[Romulus]

Can anyone confirm or deny the following -

1. John Holland has Singapore interests or visa versa
2. Singapore Airlines has a strangle hold on terminal gates at Melbourne airport that are currently being used by VB.

Within reason I can confirm we have no Singapore connection other than a normal Australian company trying to win work from Singapore the airline and Singapore the country. We have some Singaporean nationals who work at JH. We have no undue influence whatsoever.

I have no idea about gates at Melbourne airport.

[Romulus]

if and when it happens will type training and PCT be available for those of us out there without A320 in book and lucky enough to get a slot at JH

You mean like the 73NG training we're going to pay people to attend prior to the completion of the contract? We'll pick up the wages that the administrator has to pay people whilst they go on the course.

A320s are the same. Soon as there is an operational need (and we're intending forecasting a lot further into the future than is presently done) we'll have more training than you can poke a stick at.

Which, all going to plan, will occur very shortly.

[apacau]

From the Lion's, errrr... Tiger's, mouth!

* * *

TIGER AIRWAYS ROARS INTO MELBOURNE

Tiger Airways Australia to set up headquarters in Victoria

Melbourne: May 3, 2007: Tiger Airways Australia announced today that it will be establishing its headquarters in Melbourne, at the City’s main domestic and international gateway, Tullamarine Airport. This decision was concluded after weeks of meetings with airports and cities across Australia.

Tiger Airways President and Chief Executive Officer, Tony Davis said it was a very tough decision as many of the competing airports put forward very strong presentations. Unfortunately there could only be one winner.

"We went through a thorough and detailed selection process and chose Melbourne, as it presented the best opportunity for the successful launch of Australia’s first truly “Low Fare” Airline. "

Together with its comprehensive skills base and long aviation heritage, the flexibility offered by Melbourne Airport, Victoria State and the City of Melbourne demonstrated a deep understanding of Tiger’s low fare model. The State, aviation & tourism industries, together with the wider community, rallied together to make Melbourne a compelling choice, Davis said.

The introduction of Tiger Airways low fare model to the Melbourne market will provide a significant boost to regional tourism and ensure that travelers will enjoy genuine competition and an end to the inflated fares being charged by the current airline duopoly.

He also said that the selection of the base was an important step in establishing a successful new airline operation in Australia, providing over 1000 job opportunities and offering the competitive low fares that Australians deserve. Tiger Airways has now commenced tendering maintenance, ground handling, training and catering contracts.

“The Air Operator’s Certificate (AOC) process is on track and we are now talking to a variety of cities about destination opportunities so that we can start planning our route network .We’ve also started talking to a number of cities about the opportunities for locating a second base in Australia.”

“Tiger believes that Australians will embrace and enjoy its concept of genuine low fare travel. And I thank all the States, airports and communities for their enthusiasm to have Tiger Airways fly to their city, Davis added.

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

The initial year of operations will see Tiger basing 5 brand new Airbus A320s with a single class configuration of 180 seats. Davis said that the airline expects to carry around 2 million passengers in its first year.

Tiger Airways has already established a successful international presence in the Australian market, currently operating four times a week from Darwin to Singapore, and daily between Perth and Singapore.

For more updates about Tiger’s plans, please visit www.tigerairways.com

About Tiger Airways

Tiger Airways is one of Asia’s leading low fare airlines. Tiger Airways took to the air in September 2004 and is the popular choice of travellers who want reliable point-to-point air travel at very affordable fares. Tiger Airways now flies to six cities in Thailand, two cities in Vietnam (Ho Chi Minh City and Hanoi), Guangzhou, Shenzhen, Haikou and Macau SAR in China, Indonesia (Padang), the Philippines (Clark-Manila) and is the only low fare Asian airline to serve Australia with services between Singapore and Darwin and Perth.

Tiger Airways hit its two millionth passenger milestone on the 13 December 2006, just four months after passing the 1.5 millionth passenger mark in August 2006. Tiger Airways is one of fastest growing low cost airlines in the Asia Pacific region, with strong growth in annual passenger numbers of almost 100%.

Tiger Airways was recently recognized for its industry leadership in performance and product innovations when it was awarded “Low Cost Airline of the Year” (2006) by the Centre for Asia Pacific Aviation (CAPA). The airline was selected from amongst Low Cost Airlines in the Asia Pacific and the Middle East region to receive the CAPA Aviation Award for Excellence. Tiger Airways showed leadership through its strategic positioning and expansion and development of new markets and its network, while keeping operating costs low to maintain stable revenue streams and offering consistent low fares to its passengers.

For more information about Tiger Airways, visit www.tigerairways.com

[Buster Hyman]

Quick link (http://www.tigerairways.com/oz/ozwelcome.php) to Checkerboards point. It seems pretty clear Checker...IMHO.;)

The Kavorka...indeed, why would you enter such a market. I think that if you take Flight Detents comment, you may see what their intention is.

[Ref + 10]

I would have liked to see Sunfish be able to reply to this thread. Finally he would have been able to post a happy response to something...

[VirginBlueDriver]

Apply Here :-

http://www.tigerairways.com/oz/ozcareer.php

[Buster Hyman]

Indeed...a moments reflection for one of Melbourne's most loyal citizens....

(That's enough)

[Going Boeing]

Beattie prostituted himself to get Virgin Blue's HQ in Brisbane so I assume that Bracks has been similarly generous with tax payer funds to get Tiger's base in Melbourne. As a taxpayer, I'd like to know how much subsidy each airline is getting.

Buster, I've lived in Melbourne and found that it wasn't as enjoyable an experience as you think it is. There are many better places to live (& party) than Victoria. :) :)

[Capt. Queeg]

"Melbourne has its revenge"??? That sounds really screwed up and just a little unseemly; some foreign show turns up to extract profits from the local arena and your Joe Sixpack is celebrating vengeance over another Australian city.

By the way, how does the average Mexican do better out of this? Why is it so wonderful besides massaging the ego of those who need that kind of thing?

While Victorians celebrate their "victory" over whatever, these sleazy Singaporeans are working their way into the market they've been covetting for years.

And aussies are helping them to do it by selling themselves out, yet again, to another contender for the title of The Lowest Bidder.

[Buster Hyman]

In all honesty, I didn't think I'd have to wait until page two for the Trolls to come out & feed....:rolleyes:

I don't think you're hearts in it though....

[Managers Perspective]

Is it just me or is their a polarity issue around here.

Every time I hear of a positive for the Aussie aviation industry someone comes along and plasters it with negative's.

Good on the Bracks Govt for securing Tiger, and good luck Romulus in scooping up the maintenance contract at AAES.

Despite some negative elements there are many of us who hope to keep an Australian aviation maintenance industry competative.

With a bit of luck and some more runs on the board you will no doubt bring the red jet checks back from Christchurch.

Go get em....................

[Keg]

There are many better places to live (& party) than Victoria.

Shame about the crappy game that passes for 'footy' in those other places though! On that one the game pioneered down south (and perfected in 2005 by the Swannies) has any other games played in Australia well beaten. The beer isn't flash either! :E :ok: :}

[Ref + 10]

Now I really miss Sunfish. Keg, you'd be a marked man in his hey-day!!

[Angle of Attack]

Footy? haha footy is footy (And I am content in the fact that the word footy really is gay) all the rest is rugby league good old real football! lol, As always draw a rhumb line form Brisbane to Perth, Mark it on your Maps chaps, south of that is hell, north of that is god's country! We should seperate it and shove that southern half to Antarctica, don't worry with global warming youll have a summer at least some day! haha!Thats why all you damn southerners are swarming north! haha! I'll be convinced when the net migration figures show people are moving south, which I believe aint gonna happen! So I'll be content in the fact that we $hit all over ya! lol !
:} :} By the way what does Swannies mean? Is that another gay term??

[Angle of Attack]

Now after my Gee Up back to Tiger I notice it has a unique criteria to be eligible as a pilot

"The ability to swim 50m unaided"

Is this going to be part of the selection process? And importantly will hosties have to do it as well? Naked of course as your clothes may have been shredded in an accident! :E

[harrogate]

What a load of fuss about not much.

I've already aired my extensive ramblings on what will happen when Tiger join the fray. In summary: Not much.

On the domestic front...

In the short-term 'honeymoon' period they'll bag some curious domestic passengers, but fares will settle into much of a muchness across Tiger, J* and VB with time and Tiger's complete lack of perks and bare-bones 'point-to-point', no frills ethic will irk people. If they run as late as they do in Asia, then they're ******. Most of my Tiger flights in Asia and from Darwin / Perth have been late. Call me unlucky.

Internationally...

Take a typical route into consideration... let's say MEL - BKK...
Jetstar: Direct.
Typical cost: around 500 dollars all-in, give or take 50.
Duration: 8-9 hours.

Tiger: Change Darwin ( and re-check all your baggage in again ).
Change Singapore ( and re-check all your baggage in again ).
Typical cost: after honeymoon? probably between 380 and 500.

Tiger's motto should be: 'less for slightly less!'

As for being good competition for the Oz market... utter bull****. It will mean all airlines will have to become leaner to survive, meaning less or cheaper crews amongst other things - and when businesses go lean, they stick with the lean mentality, regardless of future fortunes.

Eventually one of the airlines WILL go. I know which one.

[YesTAM]

The point about Tiger is that it will increase international CAPACITY into and out of Melbourne (and elsewhere). This is vital, otherwise the "Qantas Tax" destroys economic growth prospects from overseas tourism and foriegn investment.

[Inthemarket]

I have a theory on the direction of the domestic airline operations in Australia. As has been proven in the past, this country cannot support 4 domestic airlines. So 1 will GO! The question being which one? Usually the ones with the support and cash reserves from a parent company in the industry have survived. So out of the airlines operating here, who is not supported by such a company? This airline is going against it's business model it brought to the market in 2000, which it swore they would never do! One a/c type, keep it simple, now look what they are doing. E-jets, 777's, what the!!! Was there no lesson learn't from the 7 different a/c types AN flew? The timing couldn't be worse for this airline, reading the article in the Australian today, flight cancellations which they claim is not caused by a pilot shortage, all will be sorted in June. The word on the ground is not f:mad: g likely. They were also only "lucky" to survive back in 2001 because AN collapsed, the HR mgr quoted, "we were 2 weeks from shutting the doors", luck will not play a part in this war but good management will prevail. Bring on the competition!:ok:

[mrpaxing]

YesTam you are incorrect in your assessment as i the last year or so BA/Austrian/Gulf has pulled out of Melbourne due to low yields. lets not forget there is a lot of competition out of melbourne but at very low returns. not defending Qf but if you want to fly tiger to Sin via DRW good luck. every sector check in/out luggage, line up and so on, you get my drift. no thanks. lets also not forget AirAsia is coming to Melbourne soon :cool:

[Romulus]

Despite some negative elements there are many of us who hope to keep an Australian aviation maintenance industry competative.

With a bit of luck and some more runs on the board you will no doubt bring the red jet checks back from Christchurch.

Go get em....................

No pressure or anything........

:)

we'll be in there swinging once we get the acquisitiopn completed and bedded down. Maybe there's a sensible way to work together with ANZES. Who knows, but let's be absolutely clear - any (legal) deal we can do to bring commercially attractive work to Tullamarine or our other sites will be considered.

[harrogate]

"I have a theory on the direction of the domestic airline operations in Australia. As has been proven in the past, this country cannot support 4 domestic airlines. So 1 will GO! The question being which one? Usually the ones with the support and cash reserves from a parent company in the industry have survived. So out of the airlines operating here, who is not supported by such a company? This airline is going against it's business model it brought to the market in 2000, which it swore they would never do! One a/c type, keep it simple, now look what they are doing. E-jets, 777's, what the!!! Was there no lesson learn't from the 7 different a/c types AN flew? The timing couldn't be worse for this airline, reading the article in the Australian today, flight cancellations which they claim is not caused by a pilot shortage, all will be sorted in June. The word on the ground is not f g likely. They were also only "lucky" to survive back in 2001 because AN collapsed, the HR mgr quoted, "we were 2 weeks from shutting the doors", luck will not play a part in this war but good management will prevail. Bring on the competition!"

I agree with you that one may well go, but it's definitely not going to be VB.

VB is not going against its business model at all - their model has evolved, like every good model should. It's a relatively sophisticated progression from the 'classic' lo-co model and is, frankly, far better for having evolved.

VB has shown that its model is reactive. You don't just veer from what's seemingly your business plan and buy different types of planes on a large scale as VB have done as part of some kind of whim. Give them some credit, like them or not. And if you're privvy to the intricacies of their business model, you're obviously in a position of privilege, although I sense you're not and you're just speculating like the rest of us.

What you've seen them do in the past is only part of their business model, which I have no doubt whatsoever has reacted somewhat to recent developments in the market.

I've said before, Tiger just isn't bringing enough to the party. The Australian market has become accustomed to lo-co fares with a bevvy of perks.
Tiger's slightly lower fares (which is EXACTLY what they will be, after the obvious honeymoon period) for considerably less value in terms of what else they offer, just isn't good enough.

Much like you're not privvy to the inner workings of the VB business, nor am I to the Tiger plan. However, if Tiger do what they're doing elsewhere, which is what they've strongly hinted at ( with Davis shouting about the 'robust, proven model' they'll be bringing to Australia ), then they're not bringing enough.

Conversely, if they're planning on 'evolving' and looking more towards a proven VB style model, then they're going to be on more of a level playing field in terms of model, but at a considerable disadvantage in terms of market knowledge, size/capacity, and general reach. Slightly lower fares alone won't carry them through without LOTS of cash being poured in over a very long period, as existing airlines put on the inevitible squeeze, a squeeze that will last as long as it takes.

I really can't be arsed going into depth again, but for anyone who's interested in another totally impartial man's thoughts on the issue, then feel free to look at my earlier post and comment/abuse as appropriate.

It's good to talk.

[Two Dogs....]

Anyone know what stage of the pilot selection process Tiger management have reached?

Anyone completed an interview or had one booked?

Probably too busy to scratch....

[B772]

Inthemarket. You could have also referred to the verbal agreement by Branson to sell Vigin Blue to the Air New Zealand - Ansett Group.

Branson failed to honour the agreement after pressure from Godfrey.

[harrogate]

More fool the Air New Zealand group, then.

If Inthemarket is talking about good management winning the day, then those companies who are naive enough to regard verbal agreements as being a satisfactory and effective way of conducting high-end business deals will surely be amongst the first to fall by the wayside.

That example merely shows the utter incompetence, or at best the short-sighted complacency of the Air New Zealand management. It also shows that Godfrey knows what he's doing, surely? He's the one running the VB show, afterall.

There's very little room for honour in any business, let alone the highly competitive cut-throat Australian airline market.

[bushy]

Yes, we do live in the land of the underarm bowlers.

[Millski]

Er, and who won. :O

[bob55]

Can somebody explain to me how Jetstar makes any money on the DRW - SIN route? Are all passengers connecting from Cairns?

The return fare with Jetstar is nearlly $900 whereas Tiger is about $350 (cheaper than flying to Brisbane).

Do they not even try to compete?

Qantas mainline used to be about $1050 return to SIN, even that was too much. I would not pay $450 for a one-way Jetstar flight, especially Jetstar Asia.

I guess the only other way they get business is on the QF codeshare connecting to LHR.