Tiger Airways' losses could top $12 million if grounding continues for up to 40 days
The airline could lose $2 million per week for up to six weeks.
Singapore Business Review spoke with Peter Gibson of Australia’s Civil Aviation Safety Authority (CASA) who said that if ever the Australian regulators decide to apply the extension, the ban could last for over a month.
"If ever CASA decided to apply extension, it could be that grounding lasts for up to 40 more days," he added.
Russell Shaw, Macquarie's senior transport analyst commented, "We have previously mentioned that the cost of having the fleet grounded in Australia we estimate to be ~$2m per week, so this would continue. There would also be negative cash flow implications as there would be very few forward bookings, which is the airline's primary source of cash inflow, coupled with numerous requests for refund which would further place strain on the cash flows."
On 1 July 2011, the Civil Aviation Safety Authority of Australia (CASA) instructed Tiger Airways Australia to suspend domestic services until Saturday, 9 July 2011 due to safety concerns.
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