Virgin urged to ditch ‘troubled’ Tigerair carrier

CALLS are growing for Virgin Australia to ditch its tainted Tigerair brand and instead focus on cutting costs and returning the airline group to profitability.

Five routes flown by the low-cost carrier will be cut, its Brisbane and Sydney bases closed and fleet numbers reduced, Virgin Australia, which owns the Tigerair brand, announced on Wednesday.

The move has sparked fresh calls from commentators for Virgin, the nation's second-largest airline, to ditch or rebrand the Tigerair brand.

Virgin recorded a statutory loss of $99 million for the first half of the year and tipped it would face further financial headwinds.

Strategic Aviation Services chairman and industry commentator Neil Hansford criticised the group for continuing to breathe life into Tigerair instead of cutting its loose.

"At a time Virgin needs heart surgery, they're still using bandaids," he said.

"It makes no sense to keep Tigerair going one more day."

 

Neil Hansford, Strategic Aviation Solutions chairman.
Neil Hansford, Strategic Aviation Solutions chairman.

 

Mr Hansford said the Tigerair brand should be dropped or rebranded as "Virgin Lite", declaring Tigerair was "no threat" to Qantas's own low-cost carrier Jetstar.

"I don't know really why they're bothering," he said.

"You've got something with less than 10 aircraft against something with 80 aircraft.

"I think it's almost like a religious obsession to keep Tiger to have a low cost because Qantas has got one."

Brand Institute of Australia CEO Karl Treacher said the route, fleet and job cuts were not surprising and said it would "take a miracle to turn Tigerair around".

"In 2019 Tigerair was found to have the unhealthiest reputation in the airline sector - worse than Malaysian Airlines," he said.

"From the 100 most recognisable companies in Australia it finished 98th with only Adani and Centrelink faring worse.

"On the other hand, parent company Virgin Australia has a very healthy reputation and an incredibly strong brand locally and internationally."

 

Tigerair’s flights have been cut and its fleet reduced as part of moves to make the low-cost carrier more efficient. Photo: Stuart McEvoy/The Australian.
Tigerair’s flights have been cut and its fleet reduced as part of moves to make the low-cost carrier more efficient. Photo: Stuart McEvoy/The Australian.

 

Virgin however insisted it was committed to the future of Tigerair.

"For Tigerair to remain competitive in the budget travel market it's imperative the company maintains a low-cost base," a spokesman said.

"That is why we are accelerating the exit of Airbus A320s to become a single Boeing 737 fleet. Moving to a single Boeing 737 fleet will reduce operational complexities and provide shared efficiencies across the Virgin Australia Group in areas such as maintenance, engineering, crew resourcing and ground handling."

 



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