Tiger, Tiger, burning bright

When Singapore-based Tiger Airways took to the air on September 15, 2004, many were the pessimists who predicted a short career for chief executive officer Tony Davis.

"They told us the market was too small or that there was no market, that the Southeast Asian economies weren’t improving, and that people had no money to travel by air," said Davis.

In less than a year, Tiger Airways has proven the doomsday prophets wrong, with regular flights to 10 cities in six countries, including Clark Field, Pampanga.

Its Singapore-Manila flight inaugurated in April 2005 for an initial flight schedule of three times a week, increasing to five times a week since last Monday.

Finding a very receptive Philippine market– the three times a week flights to and from Manila were 90% booked in April and May –the budget airline will increase its flights to 10 times a week beginning July 30. This will make available at least 180,000 seats a year between Manila and Singapore on the company’s fleet of four Airbus A320 aircraft.

"What we have seen in Europe and North America is that low-fare carriers enable people to fly for the first time. This is what we have seen in Southeast Asia as well. We are taking in many passengers who have never flown before and who would otherwise not fly if they had to pay the costly fares of the full-service airlines," said Davis, who has spent 19 years in the aviation industry, two of them as start-up head of bmibaby, the successful British low-fare carrier.

"When before, family members would come home only once a year due to the high cost of flying, they can now come home more often. What’s more, they invite their relatives to come and visit them where they work. They can afford it now because of us," said Davis.

This situation is essentially replicated in such countries as Thailand and Vietnam, where a substantial portion of the population is excluded from the air travel market due to high fares.

Focus

Tiger Airways’ aircraft have a single-class configuration of 180 seats, with air fares varying per flight, depending on the availability of seats and market demand. Ninety-five percent of sales are generated online, which is secured for acceptance with VISA and Mastercard payments.

The low-fare concept bars the company from offering discounts to children, aged two to 12, and to the elderly. This is offset by at the price of each seat, which is at least 50% cheaper than those of regular airlines. To further keep costs low, all fares booked are strictly non-refundable and are subject to charges when these are amended. No-show passengers are also not entitled to any credits or refunds.

Passengers are not allowed to bring their own food for consumption during the 3.5-hour flight to Singapore but refreshments are available on board for purchase. Soft drinks in cans, juices and teas are priced at S$2 (the current exchange rate is S$1 is equal to P33), sandwiches from S$5 to S$7, instant soup and instant noodles from S$3 to S$4, and a variety of sweets at S$3 and below.

"It’s so easy to lose focus. People will tell me, ‘Why don’t you give a cup of coffee for free like the other airlines?’ But I’m not an airline. I’m an internet retailer. I just happen to sell airplane seats," said Davis. "What we spend on are the essentials, especially on safety. We have committed S$110 million for a five-year maintenance contract with the engineering division of our parent company, Singapore Airlines Ltd."