Tiger insists it will fly again but doubts linger

Tiger Airways says it will be flying in Australia again and has the full backing of its Singapore-based parent company as it tries to get its week-long grounding lifted.

Singapore-based Tiger Airways Holdings sent its group president Tony Davis to Melbourne to lead talks with the Civil Aviation Safety Authority (CASA), which grounded the Australian airline over safety concerns.

The discussions began this afternoon but travellers will have to wait until later this week to learn if CASA will apply to the Federal Court to have the grounding extended.

Some industry observers have questioned whether Tiger will be back in the air this weekend or at all, saying the unprecedented action by CASA is a major blow to the airline’s credibility.

There are also fears that if Tiger leaves the landscape, domestic airfares will soar.

Asked if the airline believed it would be flying again, Tiger Airways Australia spokeswoman Vanessa Regan said ‘‘absolutely’’.

‘‘The aim is obviously to resolve these concerns as soon as possible and resume services as soon as possible,’’ Ms Regan said. ‘‘I can confirm that the Tiger Airways group is fully committed to Australia and to getting back up in the air as soon as possible.’’

The grounding is costing the company $S2 million ($1.5 million) a week and has affected 35,000 passengers scheduled to travel domestically with Tiger this week.

Macquarie Equities analysts say there will be extensive brand damage to Tiger in Australia and that the suspension may well bring forward a reduction or complete withdrawal of Tiger from the Australian market depending on how long it’s grounded.

Shares in rival airlines jumped today. Virgin Blue shares rose 3 cents, or 10.5 per cent, to close at 31.5 cents. Qantas shares also rose, soaring 12 cents, or 6.5 cents, to $1.97.

Tiger's Singapore-listed shares fell as much as 19.5 cents, or 16 per cent, to 99.5 Singapore cents, cutting its market value to $S575 million ($437 million.)

Tiger said it was committed to a long-term future in Australia.

‘‘Our goal is to resume our services as quickly as possible whilst restoring the confidence of both CASA and the Australian public at large that safety underpins our operations at all times,’’ a Tiger statement said.

CASA spokesman Peter Gibson said it was too early to say if the grounding would be extended.

‘‘We certainly can’t rush matters but on the other hand we do appreciate the public’s frustration at not being able to know how long this will go on for and will certainly do our best to get through it all as quickly as possible, but safety has to come first,’’ he said.

Opposition transport spokesman Warren Truss told parliament the airline would have to regain the trust of travellers.

‘‘There has to be a culture of safety,’’ he said. ‘‘People like cheap fares and like to get there on time but what they want most of all is to be certain ... the airline is determined to get them to the destination safely.’’

Transport Minister Anthony Albanese said it was regrettable that Tiger flights had been grounded during school holidays but safety had to come first.

The airline says affected passengers will be automatically refunded their fares. Tiger is still taking bookings for flights from next Sunday.

AAP