Paul
Topic Author
Posts: 514
Joined: Thu Feb 10, 2005 10:59 am

How Can SQ Make Money On Their New J Class?

Tue Dec 12, 2006 10:06 am

I have just watched the promotional footage from Singapore airlines. The new products look absolutely amazing. I am wondering how on earth with only 4 seat per row in J will they be able to make any money from the product. Especially when the product will be available on the normal business routs of Paris, Frankfurt etc. If it was restricted to the ultra long haul flights I could understand offering a product that like.

How will they make money from this product without loosing their price sensitivity to their key competitors?

Regards

Paul
Veni, vidi, vici.
 
futurecaptain
Posts: 1918
Joined: Sat Sep 09, 2006 1:54 am

How Can SQ Make Money On Their New J Class?

Tue Dec 12, 2006 10:11 am

They will be increasing fares for the new product.
AirSO. ASpaceO. ASOnline. ASO.com ASO. ASO. ASO. ASO. ASO.
 
mptpa
Posts: 402
Joined: Thu Feb 23, 2006 4:34 am

How Can SQ Make Money On Their New J Class?

Tue Dec 12, 2006 10:56 am

Well, it is all about pricing... for ex: CDG-SIN return on F is close to $14k, and J is $9k, etc. Yield is high, and customers who want luxury and comfort will pay. Have you seen the SQ flights lately. All the flights I have been on have been nearly full. This is a great differentiator and until another carrier emulates them, they will make money and then will innovate to provide more....

I for one will not pay that much unless my employer/customer pays for it. But there are people with high disposable income that will frequent these services.
 
piercey
Posts: 2188
Joined: Sat Nov 12, 2005 11:07 am

How Can SQ Make Money On Their New J Class?

Tue Dec 12, 2006 11:21 am

For future reference:

SA = South African Airways
SQ = Singapore Airlines

Wow was I confused when I opened this thread :P

Either way, as said before, expect a price hike, and a big one at that.
Well I believe it all is coming to an end. Oh well, I guess we are gonna pretend.
 
flydreamliner
Posts: 1928
Joined: Sat Jan 07, 2006 7:05 am

How Can SQ Make Money On Their New J Class?

Tue Dec 12, 2006 11:57 am

Quoting Piercey (Reply 3):
Either way, as said before, expect a price hike, and a big one at that.

They had better watch out in their price hike, or they might start coming close enough to some of their less expensive competitors fares for C.

Singapore's service is great, but at some point, you have to wonder if it is worth it to as many fliers as the price gets higher.
"Let the world change you, and you can change the world"
 
SingaporeBoy
Posts: 110
Joined: Sat May 07, 2005 1:19 am

How Can SQ Make Money On Their New J Class?

Tue Dec 12, 2006 3:46 pm

The price is approximately 10-20% more than what they were offering when they were using the 747-400s.As SQ is one of the only 2 airlines flying non stop from Singapore to Paris i am sure premium passengers who usually are corporate clients and businessmen dont care how much the airfare is as they are not the ones paying.And for those who are paying its not only the service they are paying for...its the space which is the most premium item of anything on an aircraft.
 
Lufthansa
Posts: 2303
Joined: Thu May 20, 1999 6:04 am

How Can SQ Make Money On Their New J Class?

Tue Dec 12, 2006 3:51 pm

Quoting SingaporeBoy (Reply 5):

Lets not forget Singapore is also the main banking up for the whole of Southeast asia. Banks, have deep pockets and a good product is going to get them the contracts. Its not just singapore based banks either, Loads of european banks, Australian banks, and American banks all have significant operations there due to the foreign currency trading going on there. Think of it like this. If the average trader turns over a billion dollars a year, (yes - no joke on this one, thats just how much we're talking) then what the hell is another 20% extra for that airfare, for a product which will definately get you a good nights sleep? Yes, puts things in perspective, doesn't it.
 
Paul
Topic Author
Posts: 514
Joined: Thu Feb 10, 2005 10:59 am

RE: How Can SQ Make Money On Their New J Class?

Wed Dec 13, 2006 1:23 am

I am suprised it is only a 20% premium over the normal price. When you consider that BA's equivalent service product has twice the number of seats per row than the new SQ, with other airlines having 7 seats in a typical J Class row. The math is simple, a 20% premium does not cover the disparity between revenues two of comparitive airlines will make on the route. However with SQ's current financial status, I think the seating space issue takes less precedence with SQ than BA or Air France!

Paul
Veni, vidi, vici.
 
zvezda
Posts: 8891
Joined: Sat Aug 28, 2004 8:48 pm

RE: How Can SQ Make Money On Their New J Class?

Wed Dec 13, 2006 1:38 am

Also, SQ's new C class pitch is 51" so the seating density is not as low as one might assume from just knowing that it's 4 abreast.
 
Ari
Posts: 116
Joined: Mon May 16, 2005 5:08 am

RE: How Can SQ Make Money On Their New J Class?

Wed Dec 13, 2006 1:49 am

Does anyone know if SQ are going to just use this configuration on their 773ERs?

aRi
 
zvezda
Posts: 8891
Joined: Sat Aug 28, 2004 8:48 pm

RE: How Can SQ Make Money On Their New J Class?

Wed Dec 13, 2006 1:55 am

Quoting Ari (Reply 9):
Does anyone know if SQ are going to just use this configuration on their 773ERs?

This is the only configuration planned for SQ's B777-300ERs. It might also get fitted to some of SQ's newer B777-200ERs. These seats will not be fitted to SQ's JumboJets. The A340-500s already have good loads and yields, so it makes little sense to reduce the seating density.
 
jimyvr
Posts: 1597
Joined: Wed Nov 01, 2006 1:08 pm

RE: How Can SQ Make Money On Their New J Class?

Wed Dec 13, 2006 2:04 am

Quoting SingaporeBoy (Reply 5):
i am sure premium passengers who usually are corporate clients and businessmen dont care how much the airfare is as they are not the ones paying

Actually, some companies are pretty price-conscious these days...

Quoting SingaporeBoy (Reply 5):
nd for those who are paying its not only the service they are paying for...its the space which is the most premium item of anything on an aircraft.

...but if the service and amenity matches up the value what they pay, they' wouldn't mind at all, I guess.
1000 - 01MAR07 | http://airlineroute.blogspot.com/
 
HeeseokKoo
Posts: 596
Joined: Mon Jan 17, 2005 5:54 pm

RE: How Can SQ Make Money On Their New J Class?

Wed Dec 13, 2006 2:13 am

In Korea, SQ 773ER's J class requires additional $250 surcharge for one way, (HKG-SIN is $150) which makes 10~20% expensive.
 
MaverickM11
Posts: 15455
Joined: Thu Apr 06, 2000 1:59 pm

RE: How Can SQ Make Money On Their New J Class?

Wed Dec 13, 2006 2:33 am

Quoting Mptpa (Reply 2):
Yield is high, and customers who want luxury and comfort will pay.

They better hope so!
E pur si muove -Galileo
 
flying-b773
Posts: 378
Joined: Sat Apr 28, 2001 11:24 pm

RE: How Can SQ Make Money On Their New J Class?

Wed Dec 13, 2006 11:31 am

The Additional Surcharge do give people a surprise. Not all people are aware of the additional and were asked to pay at the airport. Its quite a hefy amount though, USD300 for full C class fare, and USD500 for a RTW C class fare. If you are flying that route on these 2 types of tickets, get your credit card/s ready.

regards,
North

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