Tiger Airways restructures itself for aggressive regional expansion

Singapore's low-cost carrier Tiger Airways is restructuring its business to prepare for aggressive expansion in the Asia-Pacific region. Tiger is regrouping itself into a wholly owned budget carrier.

This will give it the flexibility to create airline subsidiaries and joint ventures in markets such as China and India. In turn, these markets can purchase support services from the group. (See: Tiger on the prowl in New Zealand?)

Tiger recently appointed Daniel Ee as its new independent chairman to oversee these efforts. Group company Tiger Aviation now owns 100 per cent of both Tiger Singapore and Tiger Australia. But Tony Davis, CEO of Tiger Airways, dispelled rumours that the new structure will lead to an initial public offering, saying the airline was in no need of funds.

In 2006, the airline flew 1.2 million passengers, a growth of 75 per cent over the previous year. It was the first to operate from the budget terminal in Changi Airport, to achieve operating cost savings. Its cost structure is modelled after Ryanair.

Tiger expects to launch flights to Xiamen and cities in India and Australia later this year, while flights to Brunei are expected to begin in the first half of next year. The budget carrier is also expected to secure another base in Asia sometime in 2008. Altogether, Tiger expects to have 70 aircraft in service by 2015.