Tiger thoughts
 

Sure are putting the cat among the pigeons,,,,,so to speak....
Now, ADL - CBR gone, well since when or are we talking next year?
No business traffic, well not exactly, I know of at least one businessman who flies TT every week, for the last 5 weeks, and he is not alone.
Bad publicity from the tv show, well some may see it like that, but many I talk to can see that its the stuuuupid punters who look dumb, not the airline,,,,
Interesting days ahead.

Int Rights?
 

So how much of the airline will need to be Australian owned for them to get the right to conduct international flights?
SN

51%.

As for the Airways programe being a bad idea - how simple minded some people are! Not everyone has tertiery education i guess. I can't be bothered explaining. :ugh: Didnt the number of hits on their website after 1 week of airing sky-rocket?

So if they need 51% AU ownership how would they go about that, float it or go for a private investor?
SN

IPO couldn't come any sooner...
 

Well, clearly they are financially up **** creek :bored:

Sunstar320 - before you get too excited don't forget this was at STARTUP.
Given the fact that the period covers the commencement of the operation and simultaneously the period when oil prices went crazy and the economy was in freefall that was probably an excellent result.

Tiger are now operating not only the marginal ROK and MKY type sectors but also trunk routes and are becoming well established in a far more stable environment. I would suggest that contrary to your delight that the airline is "up **** creek", they are in pretty good shape, particularly when you consider they are backed by SQ and the Ryanair investors.

Funny how I recall the naysayers making similar 'doom' comments about Virgin and Jetstar.

There are no initial startup costs associated with this loss, all these costs were covered before March 2008. The $15 million in staff costs would have been avoided if a certain somebody didnt screw with some staff, hence turnover numbers were extreme.

Not the airline, the figures.

SQ have stated that they are not injecting anything into Tiger considering their debt.

From MrSheffield
Clearly. :hmm:

I know of quite a few guy's that have been given jobs with Tiger recently, are they losing pilots or is this the expansion? With finances like that they must be shaky hey?
SN

Whats up at Tiger?
 

Saw alot of AFP down at the Tiger Terminal today, looked on the dep/arr board and wow. Are they that low on crews that they are cancelling daylight flights and moving them to 2am? 7.45am Maroochy flight is only 17hrs delayed, same with the afternoon hobart flight, not moving till 3am.

With 5 A320's, just confusing as every aircraft is delayed for some reason. Anyone know?

easy. no cabin crew. Tiger f*k the cabin crew, cabin crew f*k the tiger. good on them. make a stance. they are slowly learning. too late probably.

M.S
I don't know about too late. These guy's are starting up in a very volatile and agressive market. No one is going to cut them any slack at all. They want to have the lowest costs of any carrier and as such from time to time they will make sure that they are paying only what they have to.

I'm not saying they will make it to profitabilty but I will say that if they do there is no way they will fail from that point provided they are the carrier with the lowest cost base and therefore can offer the lowest fares. I think they have a long way to go to find a balance between fare prices and service as well.

With QF giving up share to J* and VB/VA hittiing QF where it hurts that may just leave enough space at the bottom of the tank for Tiger to get established and look out if they do.
SN

From MrSheffield - "easy. no cabin crew. Tiger f*k the cabin crew, cabin crew f*k the tiger. good on them. make a stance. they are slowly learning. too late probably."

And by doing so destroy thousands of passengers' Christmas travel plans - have these lazy bu##rs no idea of the consequences of their actions?

If certain cabin crew (a small, bitter and badly advised minority) aren't happy then they should go - let them find out that the world actually doesn't owe them a living.

I wouldnt call cabin crew doing 170+ hours per month lazy buggers. My understanding lots of crew burnt out - calling in sick / lots fed up -resigning and no coverage to replace them

Street Talk, AFR 16 December 2009
My bold emphasis.

Interesting results for the last half year, quite an improvement. Atlhough taking into account that the SIN base is still profitable which still leaves a larger loss for the Aussie base.

Tiger IPO Link
 

Hi guys

You can download the draft Tiger IPO Prospectus here.

O P E R A - Offers and Prospectuses Electronic Repository and Access

I haven't had time to digest the financials (yet) but here are some interesting bits:

Increased competition in the airline industry could harm our Company
The airline industry is highly competitive. One of our shareholders, Singapore Airlines (together with its wholly-owned subsidiary, SilkAir (Singapore) Private Limited (“SilkAir”)) is a significant competitor of Tiger Airways Singapore. We neither coordinate our routes nor have any commercial cooperation agreements with
Singapore Airlines or SilkAir. Our Company and Singapore Airlines have not sought or received any exemption from Singapore competition laws and regulations. We compete with Singapore Airlines and SilkAir on 15 of our
international routes. See “Business — Competition”.

Conflicts of interest may arise between certain of our substantial shareholders, certain of our Directors and our Company

There can be no assurance that conflicts of interest will not arise between certain of our substantial shareholders, certain of our Directors and our Company, and that such conflicts can be resolved. Conflicts of interest may arise between one of our controlling shareholders, Singapore Airlines (and its wholly-owned subsidiary, SilkAir), and us with respect to our operations and business opportunities.

In addition to our competition with Singapore Airlines and SilkAir, Singapore Airlines is the controlling shareholder of SIA Engineering Company Limited
(“SIAEC”), one of our major suppliers. Each of Mr. Chan Hon Chew, Mr. Koh Swee Lim and Mr. Teoh Tee Hooi is a nominee of Singapore Airlines on our Board of Directors. Mr. Chan is senior vice president (finance) and Mr. Teoh is senior vice president (corporate services) of Singapore Airlines, and Mr. Koh is senior vice president (commercial) of SIAEC. In addition, Mr. Chow Kok Wah, divisional vice president (engineering operations) of Singapore Airlines, serves on the board of directors of Tiger Airways Australia as a nominee of our Holding Company.

We may also face conflicts of interest between Temasek Holdings, the parent of another of our substantial shareholders, Dahlia, as Temasek Holdings is the majority shareholder of Singapore Airlines and a significant investor in certain of our suppliers, such as SATS and Starhub Ltd. Temasek Holdings is also in negotiations with the Singapore government on the sale of Changi Airport Group (Singapore) Pte. Ltd. (“CAG”), which manages and runs Singapore’s Changi Airport, to Temasek Holdings. Temasek Holdings may own CAG in the future. Mr.
Lee Chong Kwee is a nominee of Dahlia on our Board of Directors.


======

Page 139 describes Tiger Airways' transactions with SIA.

First Impressions
 

Some comments regarding my first Tiger flight with my family.
I have flown on many flights on Easy Jet and Ryanair since their inception and filmed Easyjet and Stelios in his startup phase

Back to Tiger
Fares were very cheap, cheap enough to factor an overnight stay if the aircraft departed a day late.

Selected own seats.

72 hours min notice to alter prebooked weight of baggage is a trap, there are options with set prices for 15kg 20kg and 30 kg.


New aircraft, local sounding pilots with good communication to passengers.

Outgoing flight left on time return flight left 10 minutes late.

Cabin crew appeared happy, cohesive and were considerate friendly and helpful to passengers, the most pleasant crew I have experienced in recent times.

Explanation of Over Wing Emergency Exits to passengers seated in that row was more detailed than I have ever heard.


Luggage retrieval setup in Melbourne arrivals "shed" is an extraordinary affair but in light of the low fares is an acceptable loss of comfort to save a few $$$. But no obvious help should one have oversize baggage that wouldn't easily fit through the cattle turn-style.

From this single flight Id say that their approach is better than Ryanair as their efforts to save a few $$$ is not in your face (for instance the seats do not have the plastic backs) and the staff don't seem to have developed contempt for their passengers, although this may come in time.

If Tiger can keep the respect for passengers we experienced they would do well.
Clear communication to passengers who are new to airline travel is key to reducing instances of unnecessary angst and public displays of disapproval that begin to fray the nerves of any passenger within earshot.




I'm planning a trip to Vietnam with Tiger for the family in 2010, total cost for 3 adults and one child return from Perth is under $1500 including taxes. This is cheap enough to be happy that the plane leaves (at any time) on the days of scheduled departure.


I hope they stay in business long enough for us to take advantage of their low fares and hope that cabin staff can continue the level of service that we experienced on our first flight with them.



Mickjoebill

So whats the aircraft delivery schedule? I heard number 8 is in the country but not sure where its going.
SN

Didnt think it would be here this early, its heading off to be based in Adelaide from end of march, operating around Melbourne from 1 Feb-27 March.

Which ex Singapore aircraft is this? 9V-TAL?

OK so are there any more on the order books for Australia after number 8 or are they going to settle down and try to make some money before any further investment? Seems to me they have been losing money for a long time, how long can this go on before someone says enough?
SN

Given the recent alliance between Air Asia and J* I am starting to think that Tiger are either not that serious about their game or they need to ramp up fleet size a lot quicker than they are. I'm no MD or CEO but to me the situation looks pretty grim even if they have a good float and get a lousy $200M. They are nowhere near critical mass.

I really would like them to succeed as they are providing jobs and a service (albeit somewhat inflexible) to the public but if they think the local operators will just leave them alone to get established just because they are here they should think again. Slow and easy sounds good but it has not prevented big losses.

If you read the articles in the press it seems that the Ryanir investors would like to water down their exposure by off loading shares and equity. Note that Ryan Air's Declan Ryan and Bill Franke quit the board:confused: and the airline this week announced a new chairman

An analyst at Standard & Poor's Equity Research in Singapore, said yesterday that investors were nervous about Tiger's competitive prospects, adding that a Jetstar-AirAsia deal could "cripple" the Singapore airline

Remember this is a new start airline that has never made a profit.

I do not apologize for disliking the way Tiger does business. Personally I don't think they have a profitable future in Australia. There is low cost overheads and then there is cut everything to the bare bones and contempt for passengers - It just doesn't fit in Australia.

The only way Tiger is filling planes is with very heavy discounting. There's clearly a boycott of Tiger by any regular air traveler. This has left Tiger with the bottom of the heap leisure passenger.

I have regularly followed Tiger's booking engine and they dont sell any where enough fares at high levels to ever make a sustained profit, IMO. Business passengers, which are needed in the Australia market to profit, will NOT travel with Tiger's arrogant attitude

And their arrogance is reflected in their attempt to float on the stock exchange with an order for:ugh: 50 more brand new A320. I note their current fleet is just 7

Seriously have a good think before you buy any shares. Remember Compass folks?

Problem is, when the CEO states "It could be sometime before we pay a dividend", who is going to invest their hard earned into an investment that may never give you a return. Even hard to see the par price rising given the competition Qantas, Jetsar and Air Asia are about to launch.

Yes.................if I were a sceptic, I may think that $200 million from naive investors would be a nice little amount to wind up operations in Oz and get back to Singapore. :E

To me Tiger has some similarities to Skybus, which represent challenges Ryanair (Tiger's model) did not face.

Both are ULLC entering a market where there are existing and established LCC competitors who by comparsion offer a superior product generally at prices customers consider acceptable/affordable. Combine this with the ability for the existing players to take advantage of their economies of scale (share fixed costs over more planes, more options for recovering from MX problems etc), better route network and frequency, and to sell elsewise empty seats at low prices and life will be very hard for the ULCC.

In my mind neither Tiger OZ nor Skybus understood that their market already had expectations as to what a LCC should offer and that this expectation is at a level above what they deliver(ed).

While Ryanairs CEO often talks about how important it is for them to be ULLC, he doésn't talk about how important timing and location was to their success. Ryanair took off by being one of the first to take advantage of changes in regulation at a time when the competition was high cost - high fare, and the potential market for leisure/visiting family travel on the early routes (eg UK - Ireland) offered high growth with relatively moderate flight lengths (ie shorter than Aust routes) which kept costs low. In short they were not competiting on a route by route basis with a LCC (and initially they avoided head on competition with charters) and got the first mover advantage.

"In my mind neither Tiger OZ nor Skybus understood that their market already had expectations as to what a LCC should offer and that this expectation is at a level above what they deliver(ed)."


Exactly. I repeat that QF/DJ/JQ all get a fair share of the business market and the higher yield. Tiger gets none of this. I am sorry but Tiger is destined to fail. Maybe 12 months maximum

I wouldn't say they are Tiger are to withdraw from the Domestic market, financial goals and targets have improved quite significantly. Losses amounted to 4million in the last six months vs 25million the previous year. Cost base is nearly lower than AirAsia, and once more aircraft arrive this will continue to fall and work to their advantage. Also read this statement:

"Tiger's consolidated unit cost per ASK (available seat kilometre) came to 4.7 US cents for FY2009, just above AirAsia’s 3.8 US cents, and better than Ryanair’s five US cents. This fell further to four US cents during the first half of the current financial year. In fact, its cost per seat (ex-fuel) has fallen steadily from US$44 for FY2008, to US$40.3 for FY2009 to US$32.7 during the first half. The airline also boasts a much leaner staffing, with just 33 employees per aircraft, versus 77 for AirAsia and 65 for Jetstar"

I agree in that Tiger Australia has many similarities to Skybus, although Tiger has posted profits and does has the Singapore operation as well as Australia. And to further what windytown said, Tiger has a better chance of crippling in 2008 than now. The shareholders stated they wanted the reins of the Australian domestic market, fair enough, BUT it was who they put in charge that destroyed Tiger and that has effected the entire group. He is obviously no longer with the airline anymore but cost the airline millions that was then left to Shelley Roberts to deal with. $20 million has been spent on getting staff numbers back up to a decent level to avoid piles of flights being canceled, stranding people, putting them up in Hotels all costing them millions again, all thanks to that arsehole.. It all leads back to the disastrous image they have right now, if they operated with integrity and didn't screw their employees, well then they wouldn't be such a bad position right now. It could be fair to say that they still screw around their cabin crew, but not to the extent back in 2008.

Putting that aside, they need to pay deposits for $800 million in 2 years, whilst floating in debt and no real big profit being estimated. Its going to be an interesting run.

Well, they say its the year of the Tiger after all :ok:

I see no profits only loss - 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. So thats still a total loss.


The airline had $S18.5m in cash at September 30 with a net liability position of $S106.8m as it faces payments of $US778m for aircraft alone by the end of fiscal 2012

Would-be investors should note that Tiger's debts exceed its assets by $S107 million and that possibly includes book value (over valued assets).


Indigo intends to sell part of its 24 per cent stake into the offer while Ryanasia will reduce its 16 per cent holding if an over-allotment is triggered. This indicates that the founders are running for cover


Sorry I dont see any future. Well I see more future in Asia , but certainly not in Australia

2010 will be a different year for Tiger Australia, more aircraft & more routes. Soon to start MEL/BNE, BNE/ROK & ADL/BNE and no doubt more announcements in the near future.

The Oz operation has been successful in staying alive and growing despite the poor running of the operation early on and poor public perception. However, from here on end, (theoretically) the teething issues will be sorted outout the more people keep flying Tiger (the load factors are very positive) the more the public will realise that they can actually get from A to B without drama 99% of the time. Yes Tiger had lots of flight cancelled, but with more aircraft they can now manage the schedule better than with what they had before. Point being things should get smoother with more aircraft, so to the balance sheets.

Latest figures published show MARCH 31st - SEPTEMBER 30th 2009 loss significantly less than the same period 12 months prior. The total loss of $80 million in 2 years was mostly accounted for and pre-planned, something the newspapers fail to publish / accept / realise.

Early indications were that Tiger Oz would make profit in less time than Singapore (3 years), if this will not be achieved (probably not) it wont be far off.

If Tiger Management are reading this, which I'm sure some do, you really ought to do something more proactive about the airline's public perception. It's quite **** :(

Public perception of a ultra low cost carrier hmmm !! - look at Ryanair's media coverage, does MOL care. If it's cheap enough they'll fly Tiger again.

"Public perception of a ultra low cost carrier hmmm !! - look at Ryanair's media coverage, does MOL care. If it's cheap enough they'll fly Tiger again."

Tiger-Palm there is quite a difference between Ryanair and Tiger's ops in Australia. The only way Tiger can fill planes is with low yielding low paying pax that will never make a profit

Ryanair actually does have good on time departure record and they actually do attract a surprising amount of business pax as well. Their yeilds are surprisingly better than many expect. When Ryanair started ops they didn't have other LCC operators to compete with

Tiger on the other hand has everything going against it.

- Very Bad Reputation of arrogance and poor service
- Excessive cancelled or legthy delays
- No Australia based call centre. No 1300 call number
- POOR yields
- No email. Yes that's right you CANT even email them
- Grossly Excessive fees
- No free seat selection
- No connection service
- Inadequate route structure to compete with QF/JQ/DJ

The only business Tiger gets in Australia is the Greyhound Bus passengers looking for a cheaper alternative. It is an unsustainable model. Trying to bring a Ryanair model to Australia when there are other better value, more reliable, Australian owned airlines here just wont work long term.

I feel sorry for the Tiger employees who have worked hard with an inadequate and unresearched management team. My advice to them is get a job with one of the other airlines as soon as you can. The managmenet team need a job at crazy clarks

Tiger is unlikely to ever make a profit in Australia. About the only exception would be if the world fleet of B737 was grounded.

EDIT - Anybody who doubts how bad Tiger is should read some of the reviews. When you see an alarming number of very disgruntled passengers like this it must ring alarm bells with any potential investor. Tiger Airways Reviews and Tiger Airways Passenger Opinions about Tiger Airways product and service standards

Tony Fernandes, AirAsia X CEO as quote in the Australian Financial Review 7th Jan 2010, page 13.

Despite the vested interests, I think he makes a valid point.

First of all, I live in Europe. I have no elegances with either airline.
From my experience flying with Tiger is exactly the same as flying with Jet Star. Can the Jet Star fans please stop talking down to Tiger? They are you equal!

Surely they have some motive for the apparent madness? But what?
SN

Equal? I'll have some of whatever you're on......

1a sound asleep
F@rk!n hell. Take it easy pal. There's no need to proliferate the Coward st propaganda here buddy. We get enough of that bullsh!t from the print media.

J* mid level management puppets need to think more about how they are going to head off this Singapore onslaught and less about posting worthless and unsubstantiated drivel on prune.

Tiger Update
 

In this afternoon's 'The Australain'.

TIGER Airways, based in Singapore, is seeking to raise as much as $S273 million ($213.7m) in an optimistic initial public offering that values its shares at between $S1.35 and $S1.65.
The airline wants to sell about 165 million shares, which would represent about 30 per cent of its final register, to set up new bases, fund aircraft and pay off loans.
Most of the shares will be a new issue, but 5.8 per cent will come from current investor Indigo partners.
Ryan family vehicle RyanAsia has also said it will sell down some of its stake if the IPO is oversubscribed, but Singapore Airlines, which holds 49 per cent, and Singapore government investment arm Temasek are not selling.
The indicative price values the shares at 11.4 to 13.9 times forecast 2011 earnings. Tiger Aviation posted a net loss of $S51m in the year to March 31, compared with a $S9.8m profit the previous year, and its cash reserves slumped from $S33.4m to $S13.2m.
Meanwhile, Jetstar and AirAsia denied that they had announced a cost-cutting alliance on the same day as the start of Tiger's investment roadshow with the goal of undermining its float.


AirAsia chief executive Tony Fernandes blamed the timing on the difficulty of getting the airlines' chief executives together on the same day.
Mr Fernandes welcomed the Tiger IPO, saying another publicly listed low-cost carrier would give AirAsia something against which it could compare its performance.

If they dont get this capital raising they are in very deep poo, well the Australian operation would thats for sure.

Why do you say that? Have the share holders passed on this info to you or are you just talking out of your ar$e?

Tell me. Is there a reason why SQ and Tamasek are not interested in selling out of Tiger in this IPO?

That interests me too, obviously they know something we dont.