), See related report: Singapore Aviation Part 2: Emirates & Qatar expand. There is no denying SIA has faced in recent years - and continues to face -its biggest ever challenges. Some airlines are starting to make adjustments but competition is expected to remain intense and at times irrational (as they expand "strategically") for at least the short to medium term. Singapore PSA INTERNATIONAL ANNUAL REPORT 2020. SIA now has four daily flights to London, where it has continued to expand over the last decade by introducing the A380 and more recently a fourth daily frequency. Among Southeast Asian flag carriers, SIA continues to be the standout by a wide margin. Among the main flag carriers in Southeast Asia only SIA was profitable. This is an impressive and unmatched achievement. A decade ago sceptics predicted SilkAirs demise as LCCs started penetrating the Singapore and Southeast Asian markets. Delayed Singapore Stock Exchange Changi has been working to improve its facility in supporting large scale low cost transfer, but is finding it hard to adapt from its very high quality full service role. SIA has been profitable every year since it was established over 40 years ago. Here is a sampling of related analysis reports CAPA has published on the SIA Groupover the last couple of years (in reverse chronological order): CAPA Membership provides access to all news and analysis on the site, along with access to many areas of our comprehensive databases and toolsets. SIA has another 11,000 weekly seats and two destinations in New Zealand. Singapore Airlines ( SIA 's) profits have dropped steadily over the last several years, driven by intensifying competition and challenging market conditions. In the other markets the void will be filled entirely by other airline groups. But such comparisons have become uneven as the two groups have evolved differently in recent years. SIA is also the largest Asian airline in Australia and New Zealand. SIA has remained the most profitable flag carrier in Southeast Asiaand has a strong balance sheet while some key competitors in the region are nowlooking torestructure and recapitalise. But SIA has made several strategic adjustments since Goh Choon Phong took over as CEO at the beginning of 2011. Singapore Airlines continued to build upon its global network during the last financial year, including through new services by subsidiary airlines and through new partnerships with other airlines. Singapore Airlines (SIA) reported a slight drop in operating profits at the group and parent airline for the fiscal third quarter ending 31-Dec-2014. This was done in a calibrated manner, in tandem with the easing of travel restrictions around the world. Singapore Airlines and Changi Airportannual passenger numbers: CY2008 to CY2014, Source: CAPA Centre for Aviation and company reports. Meanwhile, Scoot has forged a joint venture with Nok to establish a new long-haul LCC based in Thailand, the second of potentially multiple overseas markets for Scoot. As a result SIAs yields and load factors will continue to be under pressure. SIA is now working on a new premium product which will likely usher in a bigger change. SIAs brand, meanwhile, remains one of the best known - if not the best known -brand in the industry. In this SWOT analysis we incorporate SIA's 1QFY2015 reporting. SIA will also likely add premium economy at some point to its eight newest 777-300ERs, five of which are already in service. SIA initially missed a chance to establish short-haul LCC group Tiger Airways (now Tigerair) as a wholly owned subsidiary, lacking the confidence to invest fully and becoming only a minority shareholder. This is a weakness that will be extremely difficult to reverse, leaving the SIA Group out of the multi-hub strategies being woven by AirAsia and Jetstar. SIA is in a tough spot but still ina relatively good position compared to other full-service airline groups in Southeast Asia. In the absence of a complete commonality of interest, Tigerair arguably did as much damage to the mainline carrier as any other LCC which entered the Singapore market. But the outlook for 2015 is brighter across the SIA Group. All capacity changes to be implemented by early Jan-2016. Wendy Heng. Tigerair Singapore has more than doubled in size since 2008, when it carried abouttwo million passengers. While still unprofitable the budget subsidiaries are crucial components to SIA Groups long-term strategy as nearly all of the growth opportunities in Singapore and Southeast Asia are at the bottom end of the market. SIA and SilkAir operating highlights: 1QFY2015 vs 1QFY2014. But SilkAir has quadrupled in size over the last decade while mainline SIA has maintained roughly the same size. Singapore Airlines Limited - Ordinary shares - 210,000 Jeanette Wong Kai Yuan Ascendas Funds Management (S) Limited - Unit holdings in Ascendas Real Estate Investment Trust - 350,000 CapitaLand Limited . Singapore Airlines annual passenger traffic: 2008 to 2013, c) North America is a difficult market to access. FY2018/19 Sustainability Report. While there are huge risks in launching an airline in the Indian market, which remains generally unprofitable due to unfavourable regulations and fundamentals, there is also huge potential upside. Scoot is not yet profitable but as an early mover the SIA Group is well positioned as the long-haul LCC sector continues to evolve. SIA did introduce anew cabin product in 2H2013 on its latest batch of 777-300ERs. As international borders began to reopen through FY2021/22, the SIA Group began to rebuild its network and add passenger services. SIA is responding by increasing its involvement in the LCC sector while keeping the parent airline focused as much as possible at the top end of the market. SIA launched Scoot in mid-2012, which became the worlds third long-haul LCC after Jetstar and AirAsia X. Southwest Pacific (Australia and New Zealand) currently accounts for over 20% of SIA's ASKs while Europeaccounts for about 32% (includes Western and Eastern/Central Europe). Scoot requires short-haul feed to be sustainable. SIAs glory days are surely behind it but it would be premature to rule out significant improvements, including increased profits and faster growth, after the dust settles on the current turbulent period. This should enable Changito again get ahead of the growth curve and give Singapore (and therefore SIA) a competitive advantage over other hubs in the region, some of which have been slow to respond to growing infrastructure constraints. SIAs other close partner, Virgin Australia, also does not serve Singapore. But there will be new challenges to tackle and new projects such as Vistara and NokScoot will always incur losses during the initial phases. Sorry, preview is currently unavailable. At the time itrepresenteda leap beyond competingproducts. To learn more, view ourPrivacy Policy. You can download the paper by clicking the button above. Singapore airlines executive: passenger yields unlikely to .. Consumer Cos Up After Jobs Report -- Consumer Roundup. owners of the Company by the number of ordinary shares in issue excluding treasury shares. ), Singapore Airlines capacity changes by route due to premium economy introduction: as of early Jan-2016, Notes: *for these routes changes in total capacity are approximate because various configurations are currently used. But Scoot is not yet profitable and is not expected to make a positive contribution until at least FY2017. SINGAPORE AIRLINES. Operating profit for SIA Groups four main wholly owned subsidiaries: 3QFY2015 vs 3QFY2014, Source: Singapore Airlines Group 3QFY2015 results announcement. 19,029,000 passengers carried in FY2015/16 102 aircraft in fleet 3 new destinations to be introduced - Dusseldorf, Canberra and Wellington 2,412,000 Changi is also known to be a relatively moreexpensive airport (when also factoring inchargesfrom service providers) putting it at a competitive disadvantage in Southeast Asia. SIA has responded by focusing more on regional growth and the budget end of the market. The short-term outlook remains bleak but SIA has opportunities to improve its position over the medium to long term. The new focus on Singapore is important for SIA as it clearly needs a healthy short-haul LCC in its home market. In its results announcement SIA warned that aggressive fares and capacity injections from competitors will continue to place pressure on yields. Loss per share (basic) is computed by dividing loss attributable to owners of the Company by the weighted average number of ordinary shares in issue less treasury shares, assuming the conversion of all mandatory convertible bonds in accordance with IAS 33 Earnings Per Share. You seem to have JavaScript disabled in your browser. The initial batch of 20 A350s will also be receiving the new generation seats. Its leading premium product remains an important differentiator although the gap has been closing. b) Premium economy product shouldboost competitiveness. The SIA Group has a large operation to China, consisting of almost 60,000 weekly full-service seats. Group profitability should also improve as SIAs two budget airline subsidiaries,which are driving most of the growth, turn the corner. You seem to have JavaScript disabled in your browser. The parent airlines profit however declined by 33% as a 1.1ppts drop in load factor to 78.3% offset a slight improvement in yield. nearly all of the growth opportunities in, CAPA estimates total seat system-wide capacity at, Scoot begins new chapter as Singapore Airlines long-haul LCC subsidiary takes first 787, Long haul LCC Scoot's 2015 outlook: transition to 787s and strategic growth, including Melbourne, Tigerair Singapore CY2015 outlook brightens after return to profitability in fiscal 3Q, SilkAir slows its expansion. See related report: Singapore Airlines new cabin products represent baby steps but are important to premium strategy. But ASKs will likely be cut slightlybecause the airline is removing seats from its long-haul aircraft as it introduces premium economy. SIAs future is interlocked with Changi and Singapore overall, so there is an imperative that suggests Singapore will not willingly fall behind. A 21% equity holding in Virgin Australia and associated partnership also help entrench SIA's presence in the vital Australian market. SIAs ASKs meanwhile were flat in CY2014 while Tigerair Singapore recorded 8% ASK growth. The SIA Group is also launching two new affiliate airlines in 2015 Vistara, a full-service joint venture with Indias Tata which commenced operations in Jan-2015 and NokScoot, a long-haul LCC joint venture with Thailands Nok Air which is planning to commence scheduled operations in May-2015. SIA does not partner with any Chinese carriers on domestic connections beyond its Chinese gateways. Competition for Asia-Europe traffic is more intense than ever, thanks to the rapid expansion of the Gulf carriers. The Tigerair Groupcurrently only has a10% stake in start-up Tigerair Taiwan. The results are a further indication of the challenges SIA faces. 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