Wednesday, July 13, 2011

Tiger Airways has come under fire from Australia’s Civil Aviation Safety Authority (CASA) concerning safety fears that have grounded Tiger's fleet in Australia recently.

This concerning development is not the first in aviation history to see a cost-cutting budget airline walk the proverbial tightrope between maintenance costs and profitability.

Tiger Airways has a fleet of 10 Airbus A320s operating domestically in Australia. Around 9,000 people fly daily with Tiger operating 60 domestic flights.

Whilst flights to Singapore remain unaffected, the grounding of Tiger's domestic flights in Australia is a boon for competitors. Share prices for competing airlines have risen sharply as the news hit the stock markets, with Virgin Australia rising 10.5% and Qantas growing 6.5%.

CASA reportedly grounded Tiger's domestic fleet after the airline failed to address the industry body’s safety worries.

Passengers who have booked events and purchases will have to claim on their travel insurance, while the cheap air fares will be refunded by Tiger.

The fleet grounding has been extended to at least 31st July 2011 (Source).

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