Son of Ryanair aims to realise eastern promise

Former Ryanair director Charlie Clifton is on familiar ground as a key player in a Tony Ryan-backed low-cost airline in Asia, …

Former Ryanair director Charlie Clifton is on familiar ground as a key player in a Tony Ryan-backed low-cost airline in Asia, writes Siobhán Creaton, Finance Correspondent.

When Charlie Clifton cashed in his chips at Ryanair last year, he was planning a round-the-world trip and had ambitions to learn to sail in Australia and maybe start a new business in 2004.

This week he turned up in Singapore as a key figure charged with establishing Asia's new low-cost airline, Tiger Airways, that is being backed by Ryanair's founder, Tony Ryan and his family and the Irish airline's chairman, David Bonderman.

They are planning to replicate Ryanair's success in the densely populated region but may draw the line at inflicting a loud-mouthed and brash chief executive to lead the charge into Asia.

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Mr Clifton was the fifth person employed by Ryanair when it started in 1986 and during his 16-year career at the airline, worked as a steward, on the reservations and check-in desks before being elevated to run its operations and in-flight services.

He was appointed as a director just two weeks before the airline floated on the Dublin and New York stock markets in 1997 and was awarded share options that earned him a tidy sum. The 40-year-old former hotel manager is coy about just how much money he made from Ryanair but it was sufficient for him to "retire" for a while.

As he was packing his suitcase, the Ryan family asked him to consider getting involved in their ambitious plans in Asia and after months of sailing and fishing he boarded Tiger Airways.

He says the fledgling airline faces many of the same challenges in Asia as the upstart Irish airline had to overcome when it took on British Airways and Aer Lingus on the Dublin-to-London route 17 years ago. "The environment is very like when Ryanair started. It is a difficult environment but we feel that if we replicate the best bits of the Ryanair model we can be even more successful in Singapore, where there isn't a low-cost carrier."

Tiger Airways will be majority owned by Singapore Airlines and the Singapore government, with the Ryan family and Mr Bonderman's investment vehicle, Indigo Partners, taking a 40 per cent shareholding. Ryanair or its chief executive, Michael O'Leary, have no involvement in the new airline, which is scheduled to take off in autumn 2004.

It will be offering a no-frills service to destinations in Malaysia, Indonesia, India, Thailand, China and Vietnam for about half the price currently charged by the leading Asian airlines.

It intends to start with between four and 10 aircraft and will target shorter routes. It will be recruiting up to 100 staff.

A decision on the type of aircraft it will use has still to be taken and will probably boil down to a Dutch auction between the world's major aircraft manufacturers, Boeing and Airbus. "At the end of the day the key will be how much we can get aircraft for, by either leasing or buying, and we haven't made a decision on either of those. We intend to knock as much as we can out of the suppliers. The lowest price will win. After spending 16 years in Ryanair it will be more of the same old, same old - beating suppliers over the head until they bleed," he explains.

Mr Clifton points out that as Singapore has a population of about four million, there is huge potential for the new airline. "It is a more restricted environment than Europe is currently. We felt that someone was going to start a low-cost airline here and that it was as well to be us. If anyone is going to make it then we feel we have a better chance of doing it." These comments are not meant to sound arrogant, he says, but reflect a high level of expertise in the low-fares airline business.

"Singapore Airlines knows its market. It is a full service carrier but is clever enough to know that we know the low end of the market. They recognise that you can't do full service in the morning and low cost in the afternoon. We are the experts at low cost."

It will be competing with Malaysia's Air Asia and Australia's Virgin Blue, which both operate in the region. Qantas Airways has said it would launch a low-cost airline next May to fend off competition from other budget operators.

Mr Clifton said Tiger Airways was keen to announce its plans this week and formally begin to create the new airline. "Now that the announcement has been made we can crack on. Now we can go around beating up the suppliers. They now have a face to talk to. Otherwise you are just anonymous, going around knocking on doors saying we might be doing something."

Mr Clifton says he was surprised to find a high level of recognition of the Ryanair brand in Singapore. "I thought we would have to explain that Ryanair was a low-cost carrier in Europe and so on, but not at all. Everybody generally knew the story. They knew that it worked and that it is successful. People here are quite well up on it."

The airline will shortly begin to meet airports throughout the region to negotiate cheap deals. Most of the airports are state-owned and Mr Clifton says he fears it will encounter "many Aer Riantas" and possibly a "few Mary O'Rourkes" along the way.

One of Mr Clifton's top priorities will be to recruit a Singapore-based chief executive and a management team. He declines to state whether he has a shareholding in the new venture but says he will have an on-going role in the development of Tiger Airways.

"I wasn't sure about what I wanted to do in the longer term. This opportunity came up. Going forward my involvement will not be full time. I intend to go back to Ireland."

Mr Clifton says Tiger Airways may have to adopt a different style of management in Asia to that adopted by Ryanair in Europe.

"We would be delighted if we got somebody of the calibre of Michael O'Leary. Michael has got a very personal way of doing business that might work down here or people might be highly insulted by it. I don't know. We will do what we feel is the best thing locally and adapt it. If a potential candidate comes in cursing, roaring and shouting, that doesn't mean that they will get the job," he says.

Factfile

Name: Charlie Clifton.

Age: 40.

Family: He is single.

Education: Blackrock College Dublin. Studied for, and failed, a course in public relations. He went on to train in hotel management at the Burlington Hotel.

Career: Joined Ryanair when it was set up in 1986. Worked on reservations, at the check-in desks and as a steward on flights. He progressed to become the airline's director of operations and inflight services before "retiring" from Ryanair in December 2002.

Interests: Sailing, fishing, outdoor pursuits.

Why he is in the news: He will establish a base for Asia's new low-cost carrier, Tiger Airways, in Singapore and have an continuing role in its development.