Tigerair is pulling out of Bali after the Indonesian government refused to grant it a licence

Photo: Roslan Rahman/ AFP/ Getty Images.

Tigerair has announced it will no longer fly to Bali after failing to come to an agreement with the Indonesian government.

The decision will impact Virgin Australia, the Tigerair’s owner, which uses the budget airline as a holiday carrier, much like Qantas does with Jetstar.

A short time ago, Virgin shares were down 2.3% to $0.21. The fall came after the airline posted quarterly numbers showing a slowdown in domestic Australian demand.

Tigerair Australia in 2016 posted its first year of profit, an underlying EBIT (earnings before interest and tax) profit of $2.2 million. The Bali flights, its first international operation, started in March last year.

Indonesian authorities told Tigerair they weren’t giving the approval needed for the airline to operate to and from Bali.

And the process to get that approval would take at least six months to implement, compromising the airline’s ability to offer low-cost airfares.

The issue is centred around selling tickets under the Tigerair banner and the status of Tigerair as a charter flight operator.

“As a result of this development, Tigerair Australia has today made the difficult decision to withdraw from flying between Australia and Bali permanently, effective immediately,” the airline said in a statement.

Tigerair CEO Rob Sharp says he understands the impact this will have on passengers booked to travel to and from Bali.

“We sincerely apologise to all affected passengers,” he says.

“We will continue to work around the clock to support them as best we can.

“Tigerair Australia’s ambition to have a short haul international network remains and we will now work towards alternative opportunities.”

The airline says those due to travel from Australia to Bali will be offered full refunds.

Those coming from Bali to Australia today will be found seats on Virgin Australia flights and other carriers.

A list of today’s flights affected:

  • TT17 ADL-DPS
  • TT19 PER-DPS
  • TT10 DPS-ADL
  • TT24 DPS-PER

Last month 2,000 Australians were stranded in Bali during the Christmas holiday break following similar issues.

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