Singapore Airlines announced (01-Nov-2012) plans to increase Singapore-Copenhagen frequency from three to five times weekly from 31-Mar-2013 following final regulatory approval from the Competition Commission of Singapore (CCS) for a JV with SAS Scandinavian Airlines - see Route Changes Table for more information. SAS, which commenced codesharing with Singapore Airlines in Dec-2010, will codeshare on the additional frequencies. This is in addition to the airlines' existing codesharing agreement which sees Singapore Airlines place its code on SAS-operated services from Copenhagen to Helsinki, Oslo and Stockholm. SAS also codeshares on selected Singapore Airlines' Singapore-Bangkok Suvarnabhumi services. The airlines are discussing an expansion to their codeshare ties and are exploring new services between Singapore and Scandinavia. Singapore Airlines EVP commercial Mak Swee Wah said, "We are very pleased to announce an increase in frequency to Copenhagen now that regulatory approvals have been obtained for our wide-ranging partnership with SAS. We look forward to further building on our ties with SAS to provide more travel choices for our customers." [more - original PR]
Singapore Airlines to increase Singapore-Copenhagen frequency as SAS joint venture approved
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For Western Europe there is no bigger long haul market than North America. In terms of the number of airport pairs between the countries of Western Europe and long haul destination countries, connectivity to the United States dominates. There are more direct routes between Western Europe and the US than there are between Western Europe and the whole of Asia Pacific.
This report presents high level data on the numbers of airport pairs between each Western European country and the US and how these number have changed. EU-US liberalisation in 2008 has stimulated growth in the number of direct connections, although the global economic downturn impeded this for a while. However, the additional routes have not been spread evenly across Western European countries.
Since 2010, additional route numbers from Western Europe to the US have been greatest from the largest markets – the UK and the US – and from the smaller countries, particularly Ireland, Iceland and Norway. Countries in between, including France, Italy, Spain and the Netherlands, have hardly added any new US routes at all.
SAS eyes lower labour cost bases outside Scandinavia as the airline's margin starts to fall again
A harsh truth for SAS is that improvements to its network and product, and its focus on Scandinavia's frequent travellers, have not isolated it from unit revenue weakness. Moreover, in spite of very creditable progress with unit cost reduction, it still has a high cost base. In FY2016 its operating margin started to turn down again. In addition to further targeted cost savings SAS is now considering further, more radical, changes to its production model.
In particular, it is assessing whether or not to establish operations outside Scandinavia for some of its European traffic. The European airline market includes a fast-growing and price-sensitive leisure segment, where SAS tries to compete against much lower cost operators that are not weighed down by Scandinavia's very high labour costs.
Even Scandinavia's most significant LCC, Norwegian, has established bases in the UK and Spain, and many other LCC competitors have bases across the continent. Indeed, it would seem that SAS, once an opponent of Norwegian's plans to use Ireland as a trans-Atlantic base in search of lower labour costs, has borrowed a page from its rival's book on how to re-write airline strategy.