Airline economics 100

Credit Suisse analysts questioned Tiger's longevity in Australia, given it could make more money per aircraft in Asia compared with continuing losses in this country and noted how its pricing was 'disruptive to the leisure market". This is jargon for setting prices in tune with consumers' demand rather than stock market analysts' carefully calibrated profit maximising preferences.

Macquarie Equities analyst Russell Shaw estimated that the grounding of Tiger's 10 A320s would cost the company at least $2 million a week in non-flying costs, with no revenue offset. Macquarie upgraded its recommendation for Virgin to "outperform" on the back of the Tiger developments.

Once again, the industry has flown backwards. Back to the time considered the 'natural' state of Australian aviation, when the skies were open to the duopoly: TAA and Ansett or Australian/Qantas and Ansett.

Until further notice, domestic aviation is still a duopoly, with only Virgin Australia standing between much buffeted consumers and the very poor corporate citizen called Qantas.