A2
Topic Author
Posts: 43
Joined: Wed May 02, 2001 4:01 pm

Will Silk Air Fly To BKI And Kch?

Sat Jul 06, 2002 3:23 pm

Hi all,

Silk Air, being a regional carrier for Singapore Airlines has been doing a pretty good job flying routes that are too thin to be served profitably for SQ. One of the most obvious such destination is Medan, IMO. Now that SQ has stopped flying to BKI and KCH, will Silk Air be taking over these routes?

Also does anyone know why SQ used to serve these destinations with about 2 weekly flights each while MH fly these routes daily? (I believe MH even has 2 daily flights to KCH) Was it due to government imposed restrictions? Or was it due to market conditions?

I think these two routes will be a good fit for MI's network. The A320/319s will also be easier to fill than SQ's A310s. They may even be able to serve these destinations with higher frequencies to attract more business.

What do you guys think?

- A2
 
SInGAPORE_AIR
Posts: 11619
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RE: Will Silk Air Fly To BKI And Kch?

Sat Jul 06, 2002 4:26 pm

I agree with your logic that SilkAir should expand. I think they're lacking planes at the moment.

Ahh I see. Kota Kinabalu and Kuching.

SIA withdrew those services because of marketing conditions, I'll search later.

In addition, to the routes being unprofitable to SIA, SilkAir only needs a load factor of around 55% to be profitable.
Anyone can fly, only the best Soar.
 
SInGAPORE_AIR
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RE: Will Silk Air Fly To BKI And Kch?

Sat Jul 06, 2002 4:56 pm

SIA Suspends Services To Three Destinations
17 October 2001

Following further reviews of its operating patterns in light of the adverse economic conditions faced by the aviation industry, Singapore Airlines (SIA) is suspending its services to Kota Kinabalu, Kuching and Macau at the end of this month. All three destinations are currently served twice a week.

The decision to suspend services to the three cities is part of SIA's continuing efforts to fine-tune its capacity requirements and contain costs in a difficult operating environment. Since the events of 11 September, forward bookings have declined on some routes while costs, in particular insurance premiums and security costs, have risen sharply. Consequently, an insurance surcharge, which is currently fixed at US$5 per passenger flight sector, is being levied on all services.

Source: Singaporeair.com
Anyone can fly, only the best Soar.
 
docpepz
Posts: 1706
Joined: Thu May 24, 2001 8:20 pm

RE: Will Silk Air Fly To BKI And Kch?

Sat Jul 06, 2002 5:01 pm

Silk Air will be flying to Macau and Chengdu sometime in the near future. I saw ads in The Straits Times announcing twice daily services to Macau and Chengdu.
 
Ex_SQer
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Joined: Wed Apr 24, 2002 5:43 am

RE: Will Silk Air Fly To BKI And Kch?

Sat Jul 06, 2002 6:03 pm

Under the very first ASA with Malaysia after MSA was split into SQ and MH, SQ was only allowed to operate into KUL. In 1982 the agreement was expanded to allow SQ to fly into PEN. In the late 80s the state governments of Sabah (where BKI is located) and Sarawak (KCH) began to pressure the federal government to allow SQ to fly into their states because SIN was a major hub and allowing SQ in would bring in more tourists. The federal government agreed, but limited frequencies to two flights per week to each city, and it also stipulated that no more than 40% (or is it 30% - can't remember) of available seats be sold to Malaysians. This was to protect MH and to ensure that SQ genuinely brought in tourists.

SQ began services to both cities in 1991. Neither destination was profitable from day one. It was hard to make a profit on a twice weekly service, and SQ failed to attract business traffic, which MH could attract with its more frequent flights. SQ bailed last year in order to cut its losses.

SilkAir has, for the moment, decided against starting services to KCH and BKI because (1) they feel that they too cannot compete with MH, even with their lower cost base (compared to SQ); (2) it is too much of a hassle to monitor and keep the 40% Malaysian pax condition.

And, Docpepz: Macau and Chengdu will each be twice weekly, not twice daily.
 
Guest

RE: Will Silk Air Fly To BKI And Kch?

Sun Jul 07, 2002 10:39 am

Actually Sabah Government is begging SIA to return Kuching and Kota Kinabalu. Because since the pull-out from SIA, the tourist number has been dropped significantly.

Silkair is now expanding its Airbus 319/320 fleet to unspecified number, which we could see Silkair take over some former and current SIA route operated by A310.

The destinations that Silkair is likely to takeover are those SIA is having problem to fill their A310s, or the capacity that will not be able to fill a 777.
 
A2
Topic Author
Posts: 43
Joined: Wed May 02, 2001 4:01 pm

RE: Will Silk Air Fly To BKI And Kch?

Sun Jul 07, 2002 1:59 pm

Any chance this "one-sided" agreement between Singapore and Malaysia will be modified to allow Singapore carriers more access to Sabah and Sarawak?

Or will the Malaysian gevernment now be more determined to stick with the current agreement in order to help enhance KUL's attractiveness as South East Asia's hub?
 
Ex_SQer
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RE: Will Silk Air Fly To BKI And Kch?

Sun Jul 07, 2002 3:48 pm

A2:
Unfortunately relations between Singapore and Malaysia have been tense for some years now and for the time being a liberalised ASA isn't anywhere near the top of their list of bilateral issues to discuss.
 
hkg82
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RE: Will Silk Air Fly To BKI And Kch?

Sun Jul 07, 2002 7:12 pm

Silk Air can fly to destinations that SQ find unprofitable because of its low cost structure & cost-effective A320s. I see Silk Air taking up more of SQ's A313 routes when SQ phase them out of their fleet.

The relationship in this regard is the same as that of CX's & KA's however it appears now that KA is stepping up to compete with Cathay regionally & maybe even long haul.

Hkg82.
 
MAS777
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RE: Will Silk Air Fly To BKI And Kch?

Sun Jul 07, 2002 8:48 pm

A2 "Any chance this "one-sided" agreement between Singapore and Malaysia will be modified to allow Singapore carriers more access to Sabah and Sarawak?"...

The initial ASA between the two countries was also one-sided in the fact that with the split of MSA - SIA took the majority of the jet-fleet and international air services agreements worldwide, whilst MAS began operations with a fleet of F27s and a small number of 737s - operating domestic and regional routes only. So - MAS got the exclusive rights to operate 'domestic' services out of SIN - which I think was a rather fair trade-off.

Jiml1126 "Actually Sabah Government is begging SIA to return Kuching and Kota Kinabalu. Because since the pull-out from SIA, the tourist number has been dropped significantly."...

Does this period also correspond with the general downturn in tourism following Sept.11th and not just the fact that SIA stopped flying in.



 
Guest

RE: Will Silk Air Fly To BKI And Kch?

Mon Jul 08, 2002 2:26 am

The relationship in this regard is the same as that of CX's & KA's however it appears now that KA is stepping up to compete with Cathay regionally & maybe even long haul.

It's not the same case. CX holds minority share of KA, while SQ holds 100% share of MI. Obviously MI can not do everything that it wants like KA.

Does this period also correspond with the general downturn in tourism following Sept.11th and not just the fact that SIA stopped flying in.

Sabah was having a hard time after September 11 for the tourism idustry. SQ's departure from Sabah makes the situation worse.

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