Main Competitors
The main competitor for Tiger Airways is AirAsia Group, which emerged as the leading LCC in Asia by fleet size and passengers carried. Formed in 2001 by Tony Fernandes, the company successfully expanded across Southeast Asia through joint ventures such as Thai AirAsia and Indonesia AirAsia. By 2015, its fleet exceeded 80 aircraft, and it captured a substantial share of the regional market (Koh & Clive, 2016). AirAsia was renowned for its high service quality and safety standards, having won the “World’s Best Low-Cost Airline” award for seven consecutive years.
Another major competitor was Indonesia’s Lion Air Group. By 2015, Lion Air had over 100 aircraft and was pursuing ambitious expansion plans across Asia. In its home market, it dominated Indonesia’s domestic air travel sector with a 47% market share in 2011. However, Lion Air suffered from a poor safety record and flight disruptions, including a fatal crash in 2004. As a result, it remained banned from flying in European Union airspace as of 2015 (Koh & Clive, 2016).
Strategic Issues
In contrast, Tiger Airways held a smaller market share compared to these aviation giants. Despite its 2003 launch as a discount airline based in Singapore, the company struggled to secure a market share due to the dominance of well-established legacy and regional competitors. Several strategic issues plagued Tiger’s growth:
- Restricted access to major Indonesian cities stifled expansion. Protectionist policies favored national carrier Garuda over foreign LCCs.
- Fierce competition from AirAsia and Lion Air in Tiger’s target markets of Indonesia and Malaysia led to damaging price wars.
- Persistent safety issues and flight disruptions damaged Tiger’s operational reputation.
- Failure to meet customer service expectations, despite offering low fares, led to negative public feedback.
Other Competitors
Tiger Airways faced direct competition from other low-cost carriers operating in Southeast Asia, especially:
- AirAsia. Extensive overlapping routes and destinations. Battled for market share in Singapore. Pioneered the region’s LCC model.
- Lion Air. Contended for Indonesia’s domestic air travel market. Similar LCC model and targeted budget-conscious customers.
- Jetstar Asia. Qantas’ LCC subsidiary. Key challenges to Tiger in the Singapore market.
- Cebu Pacific. Leading LCC in the Philippines, where Tiger had a joint venture.
- Nok Air. Competed against Tiger in the Thailand market. Employed a comparable LCC model.
These airlines posed the greatest competitive threat to Tiger because they operated in the Southeast Asian region, vied for the same price-sensitive customer base, overlapped significantly in pivotal markets like Singapore, and adopted similar low-cost business models focused on no-frills service. In contrast, full-service airlines like Singapore Airlines were not direct competitors since they targeted higher-paying customers seeking premium services. While other global LCCs served Asia, regional players were the foremost concern, given their immediate impact on Tiger’s core markets.
Reference
Koh, S., & Clive, C. (2016). Tiger Airways: Navigating through challenges and competition. Nanyang Technological University, 1-21.