Steve Creedy, Aviation writer | March 16, 2007
COMPETITORS of Singapore-backed Tiger Airways could find themselves facing a fleet of up to 30 aircraft, after the low-cost carrier was this week given formal approval by the Foreign Investment Review Board to proceed with its Australian subsidiary.
Tiger has said it will start operations with five A320s, but chief executive Tony Davis confirmed yesterday that the airline's request for a proposal to airports had been based on a long-term plan with a fleet of "about that magnitude".Mr Davis said Tiger intended to become a significant player in the Australian aviation scene but how it would grow would depend on the market. "If we get a favourable response from Australians - and the indications so far are that we will receive a very favourable response - the operation will grow as big as demand allows it to grow," he said.
"We've made it clear that we will commit five aircraft before the end of this year, but we can clearly add a lot more aircraft if the demand is there."
Mr Davis said Tiger was in the final stages of negotiations "with a number of Australian airports" about the location of its principal operating base.
He said the airline had received proposals from 12 airports but said it was premature to name a shortlist, although the concentration of candidates was higher in the east.
He said the interest had taken the airline by surprise. "We've now got formal proposals from the airports and we're in the process of evaluating those proposals. What we intend to do is make a decision on the operating base really in the next few weeks," he said.
"It is going to take us a bit of time to go through the proposals we've received, but we've really been very impressed by the quality and the scope."
Victoria and Queensland have both lobbied hard and Mr Davis has confirmed that Melbourne and Avalon airports are contenders. Other possibilities are likely to include the Gold Coast.
The airline said yesterday the FIRB had confirmed that Tiger Airways Australia was consistent with the Government's foreign investment policy and the board had not placed any specific conditions on the creation of the new airline.
Tiger said it would now work towards obtaining its Air Operator's Certificate from the Civil Aviation Safety Authority so it could start domestic services in Australia later this year.
Tiger already flies to Darwin and will also start services to its second international destination in Australia next week, when it starts Singapore-Perth services.
The airline recently announced that it would bring forward plans to move to daily services on the route from November to May 1 because of the big response.
Tiger estimates it will initially employ up to 1000 people and carry about 2 million passengers a year. It has promised to offer fares that undercut current pricing in what it describes as the "cosy duopoly" of the Qantas Group and Virgin Blue.
While Tiger has yet to return a profit, the owners of the Singapore-backed airline have deep pockets and neither Qantas nor Virgin Blue is taking its arrival lightly.
