Tiger Airways Exaggerated Its Effect On Pricing

In the midst of its month-long shutdown earlier this year, Tiger Airways emailed customers claiming that prices from its rivals had gone up by more than 30 per cent once it stopped flying. That seemed like an odd claim to us, and now Tiger has been forced to withdraw it after the ACCC determined it had no clear factual basis.

The ACCC has told Tiger to issue a retraction after determining that there was not sufficient evidence to back that claim (Tiger said it had sourced that information to a Goldman Sachs report). Making misleading representations can represent a breach of the Competition and Consumer Act 2010.

When we've looked previously at the impact of Tiger on overall pricing, we've noted that it's very hard to draw any definite conclusions based on actual evidence about its effect on pricing, and that cheap flights can be found on most carriers if you plan properly. Quite aside from that, the fact that Tiger made a claim that it couldn't substantiate to seemingly try and shore up its battered reputation won't do much for potential customers not sure how trustworthy the carrier is.

ACCC


Comments

    Pft, being forced to withdraw the statement means nothing, give them a proper fine so they know not to mislead people. I don't see the point having the ACCC if they're just going to give 'a slap on the wrist' to companies.

      @henry99 A fine would not be fair in this case. Their claim is not necessarily untrue (and has not been proven untrue), it is just not supported by sufficient evidence.

    first time a legal retraction has ever landed in my inbox. odd

    I live in the NT and prior to Tiger being grounded we used to pay $450 to $600 return to most southern capital cities. We now pay $800 to $1400 unless we book months in advance. As much as I dislike attitude of Tiger as an airline, I do believe that they exert downwards pressure on competitors prices, even on routes that Tiger do not fly.

    I agree with James. Have you seen what happened to flights in/out of SA now that Tiger has stopped here. Jetstar and Virgin blue are now gouging an extra 50-100% ... Thanks Virgin Blue and Jetstar. You're REAL PALS....

    James 2nd

    After Tiger cancelled flight from Adelaide to Perth, average prices jumped from $140-180 to $300-$500. 30 per cent is an understatement.

    An extra bonus is that Jetstar have not caught up yet, still have flights within an hour of tigers so eligible for their price-matching policy.

    10% cheaper than tiger after pricematch + Pilots who can read an altitude gauge, winning!

    The plural of anecdote is not data.

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