Tuesday, May 31, 2011
Wednesday, May 25, 2011
SIA to form long-haul low-cost subsidiary
Operations at the Singapore-based wholly-owned subsidiary will begin within a year, and it will be managed separately from SIA, said the Star Alliance carrier.
"The new airline is being established following extensive review and analysis. It will enable the SIA Group to serve a largely untapped new market and cater to the growing demand among consumers for low-fare travel," added the airline.
This is the airline's first major decision under new CEO Goh Choon Phong, who took over the reins at SIA on 1 January and has largely kept a low profile while reviewing the carrier's medium to long-term strategy.
"We are seeing a new market segment being created and this will provide another growth opportunity for the SIA Group," he said. "As we have observed on short-haul routes within Asia, low-fare airlines help stimulate demand for travel, and we expect this will also prove true for longer flights."
The company remains committed to its flagship airline's premium model, and this new subsidiary will supplement the existing businesses, he added. "We remain fully committed to the further growth of SIA, which will continue to offer the highest-quality products and services to our customers."
Kuala Lumpur-based AirAsia X, in which Malaysian low-cost carrier AirAsia has a 16% stake, pioneered the long-haul low-cost model in Southeast Asia and has gradually grown since it began operations in November 2007. Its network now includes London, Paris, Tehran, Gold Coast, Melbourne, Christchurch, New Delhi, Mumbai, Chengdu, Tianjin, Hangzhou, Taipei, Seoul, Tokyo and Perth.
From Singapore, Qantas associate Jetstar Asia flies Airbus A330s long-haul to Melbourne and Auckland. It also plans to offer services to Japan and points in Europe in the near term.
Details related to the new airline's branding, products and services, and route network will be announced by its management team "in due course", said SIA.
Aircraft will initially be sourced from the parent carrier, which has 20 Boeing 787-9s and 20 Airbus A350-900s on order. SIA's spokesman said that subsequently, "all options are open on aircraft sourcing".
He added that there could be routes on which both the parent airline and the new subsidiary could operate on, although this will be decided by the management team.
SIA's regional airline SilkAir will retain its business model, he said. "SilkAir is a network carrier while this subsidiary will have a point-to-point model," he added.
http://www.flightglobal.com/articles/2011/05/25/357171/sia-to-form-long-haul-low-cost-subsidiary.html
Singapore Air to set up low-fare long-haul carrier
* To use wide-body planes for medium, long haul
* Move comes as competition increases from budget airlines
* AirAsia boss dismisses threat from new carrier
(Adds AirAsia chief executive)
By Harry Suhartono and Charmian Kok
SINGAPORE, May 25 (Reuters) - Singapore Airlines (SIAL.SI), the world's second-most valuable listed airline, set out plans to enter the long-haul budget carrier market by setting up a new subsidiary expected to compete with AirAsia X.
The premium carrier faces competition from other players in Asia and the Middle East that cater to high-end passengers as well as fast-expanding budget airlines in Asia.
Wednesday's move by Singapore Airlines' new Chief Executive Officer Goh Choon Phong marks a major reversal from his predecessor's strategy.
"This is driven by the changing landscape in the industry. If you look at what's happening (in Malaysia), AirAsia X has really made leaps and bounds in terms of their operations," an aviation analyst at Standard & Poor's, Shukor Yusof, said.
"It's a new direction and it's been driven by a need for them to grow within the market," he said.
Singapore has built its reputation on high-quality cabin service.
Goh's predecessor Chew Choon Seng had questioned whether the budget carrier strategy could be successfully applied to long-haul routes, noting that passengers on 13-hour flights would expect to be served meals and enjoy some degree of comfort and entertainment.
"As we have observed on short-haul routes within Asia, low-fare airlines help stimulate demand for travel, and we expect this will also prove true for longer flights," said Goh, who has been in the top job for about six months.
The carrier controls about a third of Singapore-based budget carrier Tiger Airways (TAHL.SI), which mostly operates on short-haul routes, and owns regional carrier SilkAir.
AirAsia X is the long-haul budget carrier unit of Malaysia's AirAsia (AIRA.KL).
AirAsia Chief Executive Tony Fernandes dismissed the new threat.
"Not worried. They should be worried. Their p and l (profit and loss statemwent) going to hurt. Business(es) should stick to what they know best," he said on Twitter.
Fernandes is in the midst of negotiating a major deal with Airbus (EAD.PA) that could include more long-haul A330 passenger jets for AirAsia X as well as medium-haul A320neo aircraft.
Singapore Airlines, 55 percent owned by state investor Temasek Holdings [TEM.UL], had said near-term weakness in load factors and high fuel prices are the top threats for the carrier and will affect its operating performance.
http://www.reuters.com/article/2011/05/25/singaporeairlines-idUSL3E7GP1HE20110525
Tuesday, May 24, 2011
Airbus A380: how the airlines compare
With Korean Air soon to become the sixth carrier to operate the Airbus superjumbo, Business Traveller and seatplans.com examine the different A380 layouts offered by SIA, Emirates, Qantas, Air France, Lufthansa and Korean.
http://www.businesstraveller.com/news/airbus-a380-the-layouts
http://www.businesstraveller.com/news/airbus-a380-the-layouts
Thursday, May 19, 2011
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