Singapore Airlines KrisFlyer - SIA finally turning it around...

http://www.bloomberg.com/news/2012-07-26/singapore-air-surges-as-profit-beats-analyst-estimates.html

"Singapore Airlines Ltd. (SIA), Asia’s second-largest carrier by market value, rose the most in eight months on the city-state’s exchange after beating analysts’ estimates with its first profit increase in seven quarters."

SQ in terms of its network, fleet and freight carriage and passenger numbers is falling behind its regional peers.

If you look at the growth rate of CX, it has grown much faster than SQ.

SQ has lost its focus and hasn't addressed the market needs properly. They have ventured into budget airlines such as Scoot without given much thought to it.

Scoot duplicates the vast majority of SQ routes such as Bangkok, Sydney, Taipei and Tokyo.

I certainly don't understand BKK or TPE, as they are being served by Tiger as well. SYD, I can understand, as it is the only budget airline operating from SIN, and before that and AirAsia coming into it, no non-stop flights frofm that part of Asia to SYD. It's not a bad strategy to corner both the high-end and low-end markets. Likewise for NRT, but I think Jetstar got the jump on that and launched their own non-stop SIN-KIX route. Not quite NRT, but close enough. I think they probably should've just focused on secondary cities, and market it in the way that, if you want to take a holiday, that's where you would want to go.

SQ in terms of its network, fleet and freight carriage and passenger numbers is falling behind its regional peers.

If you look at the growth rate of CX, it has grown much faster than SQ..

Whilst I don't think you'll find anyone to argue that SQ has made some strange, maybe incorrect and definitely unfocussed decisions, it is not always as straightforward as it seems to compare the situations of CX and SQ.

Aside from HKG being more influential than SIN as a global financial centre, geographically, CX (with KA) has huge opportunities to link China with the US (and to a lesser extent to EU), and probably has an advantage in outclassing both the Chinese and US carriers operating direct services between China and US. However geographically, SQ is not an option for China-US and is a huge detour for China-EU. CX is to China what SQ is to Indonesia, and I ask which of the two markets is generating more growth in air traffic?

Also, as an aside, SQ still do serve more European destinations than CX.

As for Scoot, it is way too early to tell if it is successful or not, but on the surface it seems the strategy is to stop the leakage to Jetstar and/or prevent them starting up more routes. Have also noticed SQ codesharing on Scoot (for freight) so must be some good freight on the scoot routes as well - given that many pax probably won't have checked luggage there must be some more space in the belly for freight!

Whilst I don't think you'll find anyone to argue that SQ has made some strange, maybe incorrect and definitely unfocussed decisions, it is not always as straightforward as it seems to compare the situations of CX and SQ.

Aside from HKG being more influential than SIN as a global financial centre, geographically, CX (with KA) has huge opportunities to link China with the US (and to a lesser extent to EU), and probably has an advantage in outclassing both the Chinese and US carriers operating direct services between China and US. However geographically, SQ is not an option for China-US and is a huge detour for China-EU. CX is to China what SQ is to Indonesia, and I ask which of the two markets is generating more growth in air traffic?

Also, as an aside, SQ still do serve more European destinations than CX.

As for Scoot, it is way too early to tell if it is successful or not, but on the surface it seems the strategy is to stop the leakage to Jetstar and/or prevent them starting up more routes. Have also noticed SQ codesharing on Scoot (for freight) so must be some good freight on the scoot routes as well - given that many pax probably won't have checked luggage there must be some more space in the belly for freight!

Geographically, Singapore is great to link up SEA and linking Oceania passengers to the rest of the world, especially so that Qantas does not serve the Chinese market that well.

SIN, the airport has seen growth that SQ has not been able to tap on and the traffic went to the LCCs. Of course, with fares so much higher than competitors to routes with travel time less than 3 hours.

Another issue is the rapid rise of LCCs in SIN but not much in HKG. Jetstar, Tiger and Air Asia are strong players in SIN. Many are more willing to put their money on these LCCs to bring them to short haul destinations.

I disagree that Scoot's strategy is to stop the bleeding of passengers to Jetstar because they simply can't do so.

The only routes that Jetstar and Scoot compete on are SIN-BKK, SIN-TPE-KIX. Jetstar has responded to Scoot by offering a direct SIN-KIX flight. Scoot's late night departure to BKK doesn't make it a popular choice among BKK goers.

Scoot's intentions were clear, a medium to long haul budget carrier whereas Jetstar does everything. Short hauls to Long Hauls.

The answer to this imo is to swallow up Tiger, amalgamate it. Only then, the leakage would be limited and SQ to continue be the industry leader and by winning third on Skytrax doesn't help. Even the widest Business class seat does not win you the best biz seat, you know you ain't doing it right but I like the wide biz seats.

Aside from HKG being more influential than SIN as a global financial centre

I'd say the gap in this respect has shrunk a lot though. Certainly SIN has been closing the gap in the last ten years.

I agree with ^ that having both Scoot and Tiger is a little confusing, although as long as the two don't compete with each other too much, they'll get awat with the two brands. What's more concerning is SQ relying on budget airlines to disguise their own middling numbers. I know SIN has more competitive budget options than Hong Kong but I'd still expect their passenger numbers to have increased a lot more than they have.

I disagree that Scoot's strategy is to stop the bleeding of passengers to Jetstar because they simply can't do so.

The only routes that Jetstar and Scoot compete on are SIN-BKK, SIN-TPE-KIX. Jetstar has responded to Scoot by offering a direct SIN-KIX flight. Scoot's late night departure to BKK doesn't make it a popular choice among BKK goers. he best biz seat, you know you ain't doing it right but I like the wide biz seats.


My point wasn't about the routes they compete on. It was about getting into certain routes before Jetstar did (SYD being the most obvious one, but also OOL and NRT). BKK is just a plane utilization route and really if you look at the fares between SIN & BKK on Tiger, Air Asia & Jetstar they are often mile for mile more expensive than many other LCC destinations (particularly around weekends).