Loss-making Tigerair pins its turnaround hopes on Scoot

Growth is on the cards this year, says its CEO.

Tigerair’s integration with budget carrier Scoot gives the loss-making carrier a good fighting chance at finally reversing its losses this year, according to its CEO Lee Lik Hsin.

In Tigerair’s annual report, Lee said that the group is in for a ‘decisive turnaround’ after downsizing its operations last year.

“The challenge ahead of us has therefore been reduced to a single dimension; the Singapore operations. We believe we have the key element in place for a decisive turnaround and also for future sustainable growth. This is integration with the SIA Group, to benefit from their scale and connectivity, now that they have taken over control of the company with an increase in shareholding to 55.8%. The most significant aspect of this integration is the co-operation progressing between Tigerair and Scoot,” he said.

Lee said that due to overcapacity issues, Tigerair can no longer rely on just generating its own point-to-point or connecting traffic for future expansion.

“We must form partnerships, and Scoot is the most natural partner, since its base in Singapore and complementary network provide the greatest potential for connecting traffic. Results thus far have been encouraging, with many travellers connecting from Scoot’s Australia and Northeast China points to Tigerair’s Southeast Asia points. This partnership will become one of our engines for future growth,” he said.

“Joint venture agreements on routes that we both operate, such as Hong Kong and Bangkok, also result in better performance for both airlines, as we are able to meet the competition with our combined strength,” he added.