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| TIGERAIR FLEET File Photo |
Virgin says it “refutes speculation” from Mark Landau, managing director of investment firm L1 Capital, who told The Australian Financial Review the airline was losing so much money it would need to “cut capacity or shutdown altogether”. “Virgin Australia has no intention of shutting its budget carrier, Tigerair, and any suggestion is completely inaccurate and uninformed,” the airline said in a statement. “Tigerair will continue to play a very important role as the budget carrier for the Virgin Australia Group now and into the future.” However, an aviation analyst has told news.com.au that Virgin made a mistake in buying the airline in the first place and that it is unlikely to “ever turn a profit”. The appointment of Paul Scurrah as CEO in March has already led to big changes at Virgin Australia as it deals with a $349 million full year loss and a sinking share price. The airline has announced plans to make 750 staff redundant, cut routes including Melbourne to Hong Kong and a swag of domestic destinations, and it has bought out the remainder of the Velocity frequent flyer program it didn’t already own. Tiger has been a particular problem. It hasn’t made a profit since a modest $2.2 million in 2016. Last year the division made a loss of $45 million due, the company stated, to a reduction in capacity and passengers, fuel costs, industrial action and the cost of transitioning to an all Boeing fleet.
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