VA invests in Tiger, buys Skywest, SQ investment & ACCC Concerns

[samh004]

Re: ACCC raises concerns over Virgins tiger takeover

Or they know what we know - that under VA involvement the TT fleet will expand from 10 aircraft to 35 aircraft (well that's the promise). At the moment tiger are a fair insignificant bit player, that provide few options for travellers. Expanded fleet changes that.

Before the shutdown didn't they have a larger fleet?

I would have thought the best way to operate Tiger would be similar to JQ with few FF benefits, but something there at least...

 

[777]

Re: ACCC raises concerns over Virgins tiger takeover

I saw this when reading another story ACCC demands could scupper Virgin

Loved this comment from FC,

Tiger already exists... so it shouldn't matter who owns them, if they're there, you can use them

Perhaps they think things will change under Borghetti?

It has been made very clear in a number of statements that if VA are unable to take over Tiger then Tiger Australia will fold. That is the context of FC's remarks.

 

[samh004]

Re: ACCC raises concerns over Virgins tiger takeover

It has been made very clear in a number of statements that if VA are unable to take over Tiger then Tiger Australia will fold. That is the context of FC's remarks.

Ahh I understand now. Thanks for that.

 

[777]

Re: ACCC raises concerns over Virgins tiger takeover

JB is playing hardball with the ACCC who are making a lot of noises like they are moving towards imposing a lot of conditions on the takeover. VA are saying that they won't be bound by any onerous conditions. In parallel Tiger Singapore and SQ are making it very clear that the takeover is either approved or there will be one less player in the market as they won't wear the losses for any extended period of time. Interesting dilemma if you are at the ACCC.

 

[dajop]

Re: ACCC raises concerns over Virgins tiger takeover

. Interesting dilemma if you are at the ACCC.

Yes, but not really surprising, has there been an extended period were the Australian aviation market has profitably maintained three independent domestic mainline carriers for an extended period? Compass, Impulse, Ansett, Ozjet all gone. Granted we've had three independent carriers for the last few years, but has Tiger ever made a profit?

 

[medhead]

Re: ACCC raises concerns over Virgins tiger takeover

Before the shutdown didn't they have a larger fleet?

I would have thought the best way to operate Tiger would be similar to JQ with few FF benefits, but something there at least...

maybe 11 or 12 I'm sure someone will correct me.

 

[markis10]

Re: ACCC raises concerns over Virgins tiger takeover

maybe 11 or 12 I'm sure someone will correct me.

Currently at 11m been as high as 12.

 

[samh004]

Re: ACCC raises concerns over Virgins tiger takeover

maybe 11 or 12 I'm sure someone will correct me.

Currently at 11m been as high as 12.

Wow, I clearly thought they were much bigger than that.

 

[dk4]

Re: ACCC raises concerns over Virgins tiger takeover

In parallel Tiger Singapore and SQ are making it very clear that the takeover is either approved or there will be one less player in the market ...

That is, one less player in the short term. If VA takes a majority position in TT, then there will likely be one less player for the medium to long term (as Tiger would simply become a prong of the VA Group strategy).

Given the fair amount of advertising (even on TV for a LCC) that Air Asia is currently giving their brand down under, if TT is allowed to collapse (as it should be IMO, and SQ should lose face) I think that there is a fairly good chance that "Australia Air Asia" might be with us reasonably soon.

Allowing Tiger to be folded into VA's strategy, especially without forcing them to comply with huge capacity expansion obligations, and IMO all we will see is higher fare prices and no future for real competition in this country. (And likely no future for Air Asia domestically.)

 

[777]

Re: ACCC raises concerns over Virgins tiger takeover

That is, one less player in the short term. If VA takes a majority position in TT, then there will likely be one less player for the medium to long term (as Tiger would simply become a prong of the VA Group strategy).

Given the fair amount of advertising (even on TV for a LCC) that Air Asia is currently giving their brand down under, if TT is allowed to collapse (as it should be IMO, and SQ should lose face) I think that there is a fairly good chance that "Australia Air Asia" might be with us reasonably soon.

Allowing Tiger to be folded into VA's strategy, especially without forcing them to comply with huge capacity expansion obligations, and IMO all we will see is higher fare prices and no future for real competition in this country. (And likely no future for Air Asia domestically.)

Broadly i think you're right that VA buying Tiger will discourage any new competitor but if Air Asia are thinking of starting an Australian affiliate they're smoking something.

 

[Jousams]

Too many Australians would be afraid to fly an overseas airline with 'Asia' in the name. It would be easy for QF, VA & NZ to trash it's reputation.

 

[samh004]

Too many Australians would be afraid to fly an overseas airline with 'Asia' in the name. It would be easy for QF, VA & NZ to trash it's reputation.

No reason Air Asia couldn't be Air Australia here?

 

[777]

No reason Air Asia couldn't be Air Australia here?

They'd have to buy it off the receivers. Which is kinda my point. Australian domestic has been a bloodbath for new entrants for the last decade. I don't think Tony Fernandez has the slightest thought of entering that crossfire right now.

 

[samh004]

They'd have to buy it off the receivers. Which is kinda my point. Australian domestic has been a bloodbath for new entrants for the last decade. I don't think Tony Fernandez has the slightest thought of entering that crossfire right now.

I knew it rolled off the tongue too easily now I remember.

 

[amaroo]

If Tiger went down the gurgler......not much would change.

If VA purchased Tiger.....IMO prices would increase.

Wonder if the ACCC has learnt anything after allowing CBA to purchase BankWest?

 

[777]

If Tiger went down the gurgler......not much would change.

If VA purchased Tiger.....IMO prices would increase.

Just curious how you think that works? No Tiger means no/few ultra low fares in the market, nothing cheap for JQ to match, many thousands of seats out of the market, no one with Tiger's desperate need to lead by price. At least if Tiger are still around they are going to have to fill those seats and while VA ownership may help attract a slight premium compared to now they still are going be stuck with price as their selling point.

 

[amaroo]

Just curious how you think that works? No Tiger means no/few ultra low fares in the market, nothing cheap for JQ to match, many thousands of seats out of the market, no one with Tiger's desperate need to lead by price. At least if Tiger are still around they are going to have to fill those seats and while VA ownership may help attract a slight premium compared to now they still are going be stuck with price as their selling point.

Will Tiger really withdraw? SIA have been very proactive in getting this baby in the air - twice!

I'm assuming the cost to start an airline from scratch are substantial......having a special arrangement with an equity partner can only result in a cheap shifting of assets - IMO this will only result in a negative impact on consumers.

Tiger currently competes with VA, J* & QF........after, it will only be J* / QF.

The purchase of Tiger will allow VA to dump low margin sectors to the detriment of consumers.

 

[medhead]

Everyone has to have a point where they stop throwing good money after bad.

 

[samh004]

Everyone has to have a point where they stop throwing good money after bad.

I guess for SIA that point has come because they finally have a stake that works (VA) so they no longer need Tiger? At least in Australia.

 

[777]

Will Tiger really withdraw? SIA have been very proactive in getting this baby in the air - twice!

Losing $4m a month with no sign of a turnaround? I'll bet London to a brick that they do.