Tigerair said switching to a new operating model would be take about six months to put in place and would be prohibitively expensive.
"As a result of this development, Tigerair Australia has made the hard decision to withdraw from flying between Australia and Bali permanently", it said in a statement.
Low-priced airline Tigerair has dumped its Australia to Bali flights permanently, saying the Indonesian Government refused to provide regulatory approval for the flights.
Tigerair said that the Indonesian authorities now require an alternative regulatory solution for Tigerair's operations to Bali.
Tigerair Australia chief executive Rob Sharp said he understood the impact the decision would have on passengers booked to travel on Tigerair to Bali.
"Tigerair can deploy the aircraft on another route, but Indonesia is losing vital tourism revenues", he said.
Indeed, flight tracking website FlightAware showed three Tigerair 737-800s - VH-VUB, VH-VOR and VH-VOY - have been operating domestic RPT services since February 1. Virgin Australia had previously operated the flights but shifted them to Tigerair, aiming to restore its worldwide division to profitability. We will also provide full refunds to customers who were booked to travel to and from Bali with us. "We sincerely apologise to customers for the inconvenience caused by this situation and we will continue to work around the clock to support customers during this time".
A file image of a Tigerair Australia Boeing 737-800 VH-VUB at Melbourne Airport.
Those routes to Bali that Virgin Australia handed over to its low cost brand Tigerair Australia won't be handed back to the parent company anytime soon according to internal sources.