, Singapore

Here's proof that Tiger's Australian move was a 'strategic mistake'

It disposed 60% of Tiger Australia.

According to CIMB, Tiger Holdings’ disposal of 60% of Tiger Australia is an admission that its Australian entry was a strategic mistake. As a mature market with entrenched competitors, Australia would never have been easy. 

Even in developing ASEAN, possible misadventures are brewing aplenty.

Here's more from CIMB:

The partial disposal of Tiger Australia to Virgin Australia is part of a series of consolidation or airline closures in the Asia-Pacific. Over the past year, Kingfisher Air in India and Batavia Air in Indonesia had significantly cut flights, before ceasing to fly altogether.

In the Philippines, Zest Air’s owners have finally concluded a long-drawn sale of the airline to AirAsia Philippines, following the part sale of PAL and AirPhil Express to new owners.

Quite clearly, even in developing and growing markets, supply can expand faster than demand, leaving the weaker players reeling.

In Tiger Australia’s case, it never counted on having to face the aggressive capacity and price response of Qantas/Jetstar, which ultimately prevented the former from emerging from nightmare losses arising from its mid- 2011 suspension.

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