Virgin Australia says it remains committed to its leisure carrier Tigerair Australia, refuting claims that it could be forced to shut down the airline due to ongoing losses.
The carrier made the commitment after Mark Landau, managing director of global fund manager L1 Capital, which is a Qantas investor, told an investor forum in Melbourne last week that Tigerair Australia is losing money on many routes, and as a result Virgin will be forced to significantly cut capacity or shut it down.
Strongly refuting the suggestion, it says: “Virgin Australia has no intention of shutting its budget carrier, Tigerair, and any suggestion is completely inaccurate and uninformed.”
“Tigerair will continue to play a very important role as the budget carrier for the Virgin Australia Group now and into the future,” it adds.
Virgin Australia has already announced cuts to Tigerair’s operations, with the airline to cease Brisbane-Darwin and Proserpine-Sydney services on 3 February 2020 and Adelaide-Brisbane from 29 March 2020.
Two of its nine Airbus A320s will be returned to lessors by mid-2020 as part of its ongoing fleet restructure, first announced in 2016, which will see the low-cost carrier transition to an all-Boeing 737 fleet. Tigerair Australia currently operates six Boeing 737-800s and nine Airbus A320s, with the timing for a complete transition to an all-Boeing fleet yet to be determined, says the airline.
Cirium schedules data shows that Tigerair Australia operates domestic services, with the largest number of routes concentrated in the country's east coast.