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Location of SilkAir main hub (Singapore Changi Airport)
329 total articles
60 total articles
Singapore Changi Airport is aiming to stimulate traffic growth through a series of incentives and rebates. The initiative comes in response to slower growth and a perceived widening cost gap with other Southeast Asian airports.
Changi has set aside SGD100 million (USD80 million) for its new Growth and Assistance Incentive (GAIN) programme, some of which will be used for rebates on parking and aerobridge fees. Some of the funds will also be used to provide incentives for transfer traffic as part of a programme that has not yet been detailed.
Singapore’s passenger traffic growth has slowed to only 2% in the first five months of 2014. Even slower growth is possible for the remainder of 2014 driven by a recent drop in inbound visitor numbers from China and a slowdown from Indonesia.
Singapore Airlines (SIA) is focusing on further expanding its partnership portfolio to provide a more comprehensive network and boost feed. New deals have been forged over the last six months with Air New Zealand, Asiana, EVA Air and Turkish Airlines as part of an ongoing initiative which is expected to generate more new or expanded partnerships by the end of 2014.
SIA has already more than doubled its codeshare segments over the last three years as it has added eight new partners and strengthened several existing partnerships. The group is now negotiating several more new partnerships while seeking opportunities to improve connectivity with existing partners.
In this analysis CAPA examines the increasingly important role partnerships are playing in SIA’s European, African and Middle Eastern networks. In a second part, to be published later this week, CAPA will focus on SIA’s need to rely more on partners to expand across the Americas.
Singapore Airlines incurs 4QFY2014 operating loss, adds premium economy as latest strategic response
Singapore Airlines (SIA) continues to evolve its long-term strategy in response to challenging market conditions, which drove an operating loss for the group and parent airline for the quarter ending 31-Mar-2014. The decision to introduce a premium economy product on long-haul aircraft from 2H2015 is the latest in a growing string of initiatives aimed at improving the carrier’s position.
SIA has studied premium economy for several years but repeatedly decided against a fourth class of service on long-haul flights. The group now recognises premium economy has become more mainstream and that it is necessary to be competitive, particularly in the corporate sector.
Premium economy will be introduced as SIA starts to retrofit some of its fleet with the new first, business and economy cabin products that were introduced on new 777-300ERs in late 2013. Both initiatives are part of a broader move to continue improving its service standards as competition intensifies. Increased emphasis on partnerships and a more active role in the dynamic Southeast Asian budget sector also have become important components of the still evolving SIA Group strategy.
Myanmar’s international market has roughly doubled in size in the two years two since the former pariah state started liberalising. Nine foreign carriers have entered the market while all 13 of the foreign carriers which were already serving Myanmar have added capacity.
But the additional capacity has so far outstripped the increase in demand for passenger services. Load factors in Myanmar are now well below industry norms.
Fortunately foreign carriers appear to be slowing down their expansion and total capacity for the 2014/2015 winter season is likely to be roughly flat compared to the winter season which was just completed. Eventually all the capacity added over the last two years will be absorbed, providing a bright outlook as demand for services to Myanmar continues to grow.
SilkAir 737 MAX fleet to open up network options while boosting Boeing’s narrowbody presence in Asia
While Singapore Airlines regional subsidiary SilkAir is now celebrating delivery of its first of 23 737-800s, it is the second part of its largest ever aircraft acquisition programme that could be a game changer. The Singapore Airlines (SIA) regional subsidiary plans to take the first of at least 31 737 MAX 8s in 2H2017, enabling efficiency improvements and new medium-haul routes.
SilkAir will have the opportunity to use the MAX’s improved range to open new destinations in North Asia, Central Asia and Australia. The improved economics of the aircraft also potentially opens up destinations in India and China which are not viable with current generation narrowbody aircraft.
SilkAir is only one of four Asian carriers that has so far committed to the 737 MAX, along with Thailand’s Nok Air, Virgin Australia and Indonesia’s Lion Air. Nok, which announced its order at the recent 2014 Singapore Airshow, also expects to be one of the first carriers to take the MAX when it enters service in 2H2017.
Singapore Airlines (SIA) regional subsidiary SilkAir began a new chapter on 20-Feb-2014 as its first Boeing 737-800 entered service, taking over from slightly smaller A320s on four short-haul sectors. The carrier has just completed a momentous week as 21-Feb-2014 marked its 25th anniversary while on 17-Feb-2014 it rolled out a new brand campaign emphasising its full-service offering.
SilkAir has been extremely successful over the past decade, with steady profits and growth despite low-cost carriers invading its home market. LCCs now account for one-third of total capacity in Singapore and about half of the short-haul market, compared to virtually zero 10 years ago.
SilkAir, however, faces some of its biggest ever challenges as it begins its 26th year. Singapore’s short-haul market is suffering from overcapacity, impacting yields and load factors across LCCs and full-service carriers. SilkAir is fighting back with product, network and brand improvements but the market will not likely be able to fully absorb the capacity it is adding in 2014 as it places into service eight 737-800s.
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