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sq452
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What's Up At SQ? Issues And Questions

Fri Sep 25, 2015 12:47 pm

A couple points that make me ask this question:

1) It's been a while since SQ launched a new route/station (For what it's worth, CTS doesn't really count in my opinion given they operated that on a charter basis for a while and given it's only seasonal. ATH is a route that seems to come and go and has been in their network for ages at some point or another).

The last totally "new" routes and stations they opened up if I recall correctly was GRU via BCN which was a couple of years ago (someone correct me if I am wrong on that).

Since then, CX, TK, the ME3, and even JL and NH have been adding routes left and right it seems.

SQ seems stagnant at opening new markets, and with just a few months to go before the A350's join the fleet, I'm surprised we haven't seen any news on a new route or where these aircraft will be deployed.

Bottom line, they just don't seem to be too terribly aggressive these days.

2) SQ is having problems getting their Premium Economy product installed (go to their website and read the alert if you don't believe me) and pushing back specific route launch dates; even going as far as saying "customers with ticketed bookings who are affected by the delays will be contacted progressively by Singapore Airlines or travel agents to offer alternative travel arrangements."

That doesn't sound good at all.

I can't think of any other airline that has bungled a product rollout as badly as SQ has.

With the competition as tight as it is these days, management just seems to be asleep at the wheel.

Thoughts?
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KarelXWB
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RE: What's Up At SQ? Issues And Questions

Fri Sep 25, 2015 1:02 pm

Quoting sq452 (Thread starter):
SQ seems stagnant at opening new markets

Regarding new markets, during an interview with Flightglobal SQ recently explained that current generation aircraft are not efficient enough to open new routes.
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Polot
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RE: What's Up At SQ? Issues And Questions

Fri Sep 25, 2015 1:08 pm

Quoting sq452 (Thread starter):
SQ seems stagnant at opening new markets

Most of the SQ Group's growth is going towards Scoot or Silkair, not the SQ mother ship.

All the other airlines you mention are in much more favorable geographic locations allowing them to expand. SQ is not. The growth of those airlines is stealing traffic from SQ, so SQ is focusing on the low end of the market right now with their other airlines.
 
MaverickM11
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RE: What's Up At SQ? Issues And Questions

Fri Sep 25, 2015 1:27 pm

Quoting KarelXWB (Reply 1):
during an interview with Flightglobal SQ recently explained that current generation aircraft are not efficient enough to open new routes.

One of the more bizarre excuses I've heard in a while
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DolphinAir747
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RE: What's Up At SQ? Issues And Questions

Fri Sep 25, 2015 1:29 pm

SQ is already quite extended in core markets like Europe and Australia. Geography is their problem since they cannot reach the US nonstop. Frankly SQ probably flies way too many expensive multi-sector flights to the Americas. It's just a reflection of their inability to form meaningful relationships with other airlines. If they want to hemorrhage money again by going to the US nonstop, then they might as well.
 
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RE: What's Up At SQ? Issues And Questions

Fri Sep 25, 2015 1:38 pm

Quoting DolphinAir747 (Reply 4):
It's just a reflection of their inability to form meaningful relationships with other airlines.

That IS their single biggest downfall. CX can reach North Am nonstop, is much closer to China for its feed, and is a lot less invaded by the ME3.

The *last* thing SQ should be doing is relying on their age old business model. Time for time to patch things up and actually start working with partners. Strong JVs with LH+NH to hand off traffic at FRA+NRT is the way to go, not rehashing old ideas that rarely work for anyone.
 
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RE: What's Up At SQ? Issues And Questions

Fri Sep 25, 2015 2:43 pm

In their defence, Singapore has made some small but significant deals and arrangements with Virgin Australia (such as frequent flyer 'stuff') which they part own along with ANZ and EY. Their reputation in Australia I believe still rivals that of Emirates for service etc.
And, very importantly, they are the object of affection to all aviation photographers at Sydney airport for flying five flights a day with 5 different aircraft types (A380, 777-300ER, 777-300, 777-200ER, A330-300) plus Singapore Cargo's 747-400Fs and Scoot's Dreamliners...
Long may they last!
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ThReaTeN
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RE: What's Up At SQ? Issues And Questions

Sat Sep 26, 2015 2:53 pm

Quoting KarelXWB (Reply 1):
Regarding new markets, during an interview with Flightglobal SQ recently explained that current generation aircraft are not efficient enough to open new routes.

Unfortunately for SQ, they're apparently efficient enough for their competitors to open new routes.
 
kaitak
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 5:04 am

Quoting ThReaTeN (Reply 7):
current generation aircraft are not efficient enough to open new routes.
Quoting ThReaTeN (Reply 7):
Unfortunately for SQ, they're apparently efficient enough for their competitors to open new routes.

Yes, but SQ's configuration and hard product requirements may have a bearing on the efficiency of the current generation aircraft; hopefully the arrival of the A359s will help them open some new routes.
They have said that they would like to restart ULH nonstop to the US and there is currently nothing available that would allow them to do that ... probably waiting for the 778?

I think, like other airlines in the region, they are suffering the effects of the ME4 and the rise of regional LCCs (some of which it owns!)

Premium Y, for SQ - and indeed all carriers that introduce it - is a very important product and SQ wants to get it right. It's a pity dates had to be pushed back, but I guess that's due to acft maintenance schedules being changed?
 
infinit
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 3:50 pm

As others have pointed out, SQ faces a number of issues:

- Geography: Singapore is located in the middle of Indonesia (Google Map Singapore if you don't believe me). That's pretty far south for connections other than to Southeast Asia and Australia/NZ. The geographical advantage has shifted towards the carriers in the gulf

- ME3: The ME3 copied SQ's business model based on 5th/6th Freedoms and are doing it better- they have a lower cost base than Singapore which has gotten a lot more expensive, and the ME3 have bigger pockets. Sure SQ is 56% owned by Temasek, the investment arm of the Sg government but SQ has been run as a private company since the early 80s and the government has since never funded them

- LCCs: 15 years ago LCCs appeared in the region. They have grown exponentially since and the markets have been largely deregulated. SIN-PEN used to be a cashcow for SQ. It is now filled with LCCs and SQ decided to give the route to their regional arm, Silkair which would be more competitive on the route.

- SIN: May not be as valid in explaining their recent performance since this factor has been true all along- the Singapore government knows that Singapore's status as a hub is more important than SQ. In fact post-independence Singapore's leaders like the late Lee have said they were initially against the formation of a national airline (they had the bi-national Malaysia-Singapore Airlines then) but SQ's first Chairman, JY Pillay convinced the government SQ could be a profitable airline that wouldn't need to be protected if it competed on a strong premium brand, almost like a boutique product. The Singapore government have since given foreign carriers numerous 5th freedom routes, KL with DPS, EK to several Australian routes and CX to BKK come to mind. These routes are all very close to home for SQ.

With all these factors it's easy to see why there has been no growth in terms of new routes at SQ.

But with that said, SQ is still a very well-run company. They have never posted an annual loss and their profits have been stable. Here's their net income, post taxes etc for the past 5 years:

2010 $1.092 billion
2011 $335.9 million
2012 $378.9 million
2013 $359.5 million
2014 $367.9 million

They are also using their subsidiaries for growth in the other market segments since the premium long-haul one is saturated. Silkair, the regional full-service wing that I thought wouldn't stand a chance against LCC competition proved the opposite. They have been growing and doing well, despite the rampant LCC competition. For LCCs, they've bought into Tiger and have Scoot for mid to long haul opps.

They've also become a lot more open to partnerships the last few yars. They launched a strategic partnership with AirNZ last year, and codeshare with all StarA members except UA. I wouldn't be surprised if I hear them announcing a JV with TK soon.
 
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DolphinAir747
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 4:05 pm

Quoting infinit (Reply 9):
They've also become a lot more open to partnerships the last few yars. They launched a strategic partnership with AirNZ last year, and codeshare with all StarA members except UA. I wouldn't be surprised if I hear them announcing a JV with TK soon.

Of course they go with the two black sheep of *A: the airline who releases no partner award space ever, and the airline who undercuts all its partners with absurdly low fares.

I mean, the fact that their partner of choice at SFO is VX with their paltry network versus UA shows that SQ has some serious issues with *A.
 
changyou
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 5:15 pm

SQ have no issues with Star Alliance. Not partnering UA doesn't make any of them black sheeps. There wasn't any clause stated that all star alliance must code share with each other. Perhaps you're just bias against star alliance members that's do not take UA into consideration. SQ do have extensive partnership with many star members FYI. Even TG dropped code sharing with UA.
FYI SQ chose Virgin group as partners due to their great partnership/relationship with SRB and Virgin Holdings. And am not surprised eventually VX will change to a FSC like VA did.
 
747megatop
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 5:28 pm

Quoting MaverickM11 (Reply 3):
One of the more bizarre excuses I've heard in a while

Given their geography it might not be a bizarre excuse after all! They could open up new routes on the Asia-Australia flow but beyond that...i don't think they have the geopgraphical advantage that CX or ME3 have.
 
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 5:37 pm

Quoting 747megatop (Reply 12):

And that's the thing that strikes me about SQ -- it seems like (given their geographic situation) they are simply not going to be a massive global carrier, and may indeed be destined to always be smaller than CX by virtue of the aforementioned proximity to China and HKG being better for n/s routes to North America. But to me that doesn't mean they are necessarily in terrible shape or in danger of going under.

Point being, would it be reasonable to say that SQ's niche is connecting the SIN market to the world on O&D, plus the gravy of whatever connections do in fact make sense via SIN, or also whatever "freedoms" pax they can pick up at intermediate points across the globe?

It would seem to me that they could do fairly well making this their business model, focusing on SQ hard and soft product and not being overly concerned about getting every last pax at cutthroat prices just to catch up with CX or whoever.
 
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 5:43 pm

I struggle to understand what's up with SQ and UA. They codeshared extensively with US, which is ironic because US did not have hubs at any of SQs US gateways.
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LAXintl
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 5:49 pm

Quoting USAirALB (Reply 14):
I struggle to understand what's up with SQ and UA.

What you should ask -- whats up with United and -- SQ, TG, TK, MS, etc..

Remember it takes two to tango and United has shown its far from friendly to non-JV partners. If anything its folks like United that are making Star Alliance a select club within a club.
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changyou
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 5:49 pm

Currently the market for SQ is Asia and Australia. SQ itself had increased flight frequencies to many existing routes including deploying the 380 to capture more market shares.
On the other hand, subsidiaries are also expanding within its capabilities to explore new markets(especially secondary cities in India and China) to defend SQ group from regional LCCs
USA and European markets are still weak and some are even low yielding. Some national airlines from ASEAN had reduced frequencies, cancelled and delay launching European cities.
Come next year with the arrival of 350, the replacement of 772ER will begin first. Perhaps by then SCOOT would have announce some Long haul routes to low yielding European network where SQ's heavy premium configuration will not work.
Definitely as you'll already knew, the non stop flights to the USA are in planning phase.
Hopefully it'll be more than just NYC and LAX.
 
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DolphinAir747
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 5:59 pm

Quoting LAXintl (Reply 15):
United has shown its far from friendly to non-JV partners. If anything its folks like United that are making Star Alliance a select club within a club.

UA's JV partners are most of the important folks within *A. Regardless, they have managed to form good JV's on both TATL and TPAC, which SQ has shown itself unable to do.

Quoting changyou (Reply 11):

SQ have no issues with Star Alliance.

The fact that they refuse to follow *A protocol on painting aircraft in the *A livery says it all.
 
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 6:11 pm

Quoting changyou (Reply 11):
Even TG dropped code sharing with UA.

Wrong way 'round. UA dropped TG

Quoting changyou (Reply 11):
FYI SQ chose Virgin group as partners due to their great partnership/relationship with SRB and Virgin Holdings.

Great partnership with SRB? The carrier where they lost 2/3rds of their investment? SQ partnered with VX (and B6) because they had little other choice.

Quoting LAXintl (Reply 15):
Remember it takes two to tango and United has shown its far from friendly to non-JV partners. If anything its folks like United that are making Star Alliance a select club within a club.

Yes it takes two to tango, but look at what carriers like SQ/TG/TK/MS can offer UA, and what UA can offer them in return. It's a one way street--that pretty much explains why the vast majority of codeshares do (or do not) work.

Quoting 747megatop (Reply 12):
Given their geography it might not be a bizarre excuse after all!

There's quite a lot of growth all over the region; it has less to do with geography and more to do with a product that is increasingly disconnected with the region it serves.
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LAXintl
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 6:15 pm

Quoting DolphinAir747 (Reply 17):
UA's JV partners are most of the important folks within *A. Regardless, they have managed to form good JV's on both TATL and TPAC, which SQ has shown itself unable to do.
SQ has plenty of Star relationships.

As someone does that does lots of business and has working knowledge of how intra-alliance relationships go, I would say folks like United-Lufthansa are the bad boys here refusing to do everything from establishing the most basic pro-rate fare agreement with some of its own alliance partners.
Why do you think multiple Star partners have JetBlue and Virgin America as their US friends?

Sure UA is free to focus and give priority to its JV partners, but certainly don't blame other Star carriers when they go looking elsewhere then when their fellow alliance partner wont give them the time of day.

Quoting DolphinAir747 (Reply 17):
The fact that they refuse to follow *A protocol on painting aircraft in the *A livery says it all.

I think you better gain an understanding what such alleged protocols say or not.

SQ has had atleast 9 frames in Star livery.

[Edited 2015-09-27 11:16:48]
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mercure1
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 6:25 pm

Quoting MaverickM11 (Reply 18):
Yes it takes two to tango, but look at what carriers like SQ/TG/TK/MS can offer UA, and what UA can offer them in return. It's a one way street--that pretty much explains why the vast majority of codeshares do (or do not) work.

United could get lots. But its a matter of protecting things like A++. Not only can these carriers provide UA added domestic passengers and revenue but they could provide UA nice network extenders.

But look at someone like TK, UA using TK however blows a big hole in LH. Tons of markets can be reached via TK, but in order to protect A++ and LH these guys do everything they can to discourage their customers from flying TK such as reducing mileage accrual, limiting codeshare routes, upping interline ticket pricing etc..

For SQ specifically - does UA need to serve SIN itself? I dont know but its gotta to be a costly tag operation, something its been reducing greatly over the years. Linking up with SQ in multiple locations could provide nice connectivity - same way UA-TG worked together in HKG and NRT for example linking flights and traffic flow before the ANA JV.
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MaverickM11
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 6:39 pm

Quoting mercure1 (Reply 20):
United could get lots.

Of what? A bunch of cheap double connects? It doesn't even serve BKK/CAI/IST, and it's running an average system wide LF of 84% YTD.

Quoting mercure1 (Reply 20):
But look at someone like TK, UA using TK however blows a big hole in LH.

Every airline tries to cover their own a$$, no question. But the reason TK is problematic is because they're cheap, and the traffic UA would hand off to TK, for example, is much higher value than the traffic that could be handed onto UA from TK. In any codeshare you have to look at the value flowing both ways, and if it starts to get unbalanced, that tends to explain how it changes or falls apart.
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LAXintl
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 6:57 pm

Bottom line is that Star members like United-Lufthansa-ANA have opted to create a club within a club which has to varying degrees left fellow alliance members shunned.


Getting back to the topic of this thread what I think its important to look at it from the larger SIA view and not only SQ.

o Tigerair + Scoot are growing. Importance of LCC segment in Asia is clear and SIA wants to have a product offering to match.
o Silk Air has near 60 737NG/MAX on order or option which will see it more than double in size. Silk has been profitable 7-years running.
o SQ will remain about same size. There will be a continued refocus away from 6th freedom to primarily Singapore focused O&D with exception of Indonesia which will continue to be its largest foreign feeder market.
o Service companies like SATS, SIA Engineering continue their global expansion providing growing revenues for the group
o SIA investment in other overseas carriers and enterprises as SIA group diversifies is financial base.

Meanwhile brand Singapore and Changi continue to prosper. Singapore with an open-skies easy to do business approach continues to prosper as a regional business and tourism hub.
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Bluebird191
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 7:48 pm

Quoting DolphinAir747 (Reply 10):
I mean, the fact that their partner of choice at SFO is VX with their paltry network versus UA shows that SQ has some serious issues with *A.

But SQ actually do get along quite well with NZ, who also are in Star Alliance - don't they have a close cooperation or JV happening? I would see it more as SQ being choosy and picky who they deal with, not that they have issues with the alliance - if there was issues with the alliance they would have jumped out well before now, and likely have gone to OneWorld. Which dare I say, QF and CX in OneWorld have quite a frosty relationship.......
 
olympic472
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 7:56 pm

Quoting LAXintl (Reply 22):
Meanwhile brand Singapore and Changi continue to prosper. Singapore with an open-skies easy to do business approach continues to prosper as a regional business and tourism hub.

Not always the case. I recall Air Asia during it's inception. They had a difficult time starting service to Singapore and eventually tried connecting passengers by bus between Singapore and the airport in Malaysia. Singapore did not grant the license for the bus service for Air Asia flights.
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DolphinAir747
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 9:02 pm

Quoting LAXintl (Reply 19):
Quoting DolphinAir747 (Reply 17):
The fact that they refuse to follow *A protocol on painting aircraft in the *A livery says it all.

I think you better gain an understanding what such alleged protocols say or not.

SQ has had atleast 9 frames in Star livery.

Maybe they changed, but for a while SQ insisted on having its own logo on the tail while other airlines have the Star symbol instead of their own on the tail. It's emblematic of everything.

 
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mercure1
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RE: What's Up At SQ? Issues And Questions

Sun Sep 27, 2015 9:45 pm

Quoting olympic472 (Reply 24):
Not always the case. I recall Air Asia during it's inception. They had a difficult time starting service to Singapore and eventually tried connecting passengers by bus between Singapore and the airport in Malaysia. Singapore did not grant the license for the bus service for Air Asia flights.

I think you miss the fact that while Singapore since the 1970s have maintained open-skies policy, its takes reciprocity by the counter party.

While neighbors, relations with Malaysia are not automatically cordial in many areas and idea of open-skies within ASEAN region only came into effect this year technically while some states are still trying to slow down various provisions to protect their own interest.

Also remember bus service from place like Johor Bahru to Singapore is not part of any air service rights, but matter dealt with by land transport authorities which place their own national requirements and regulations.
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olympic472
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RE: What's Up At SQ? Issues And Questions

Mon Sep 28, 2015 5:39 am

Quoting LAXintl (Reply 22):
Meanwhile brand Singapore and Changi continue to prosper. Singapore with an open-skies easy to do business approach
Quoting mercure1 (Reply 26):
authorities which place their own national requirements and regulations.

My response was to "brand Singapore" being responsive. I prefer to say selective responsiveness, as the buses were safe and licensed (but not by Singapore's standards). You confirmed what I was trying to point out. Read it any way you wish though.

I did not think I missed too many facts. Open-skies was not the issue back then. Both Malaysia and Singapore has good access and the shuttle between Kuala Lumpur and Singapore was jointly run.
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Kashmon
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RE: What's Up At SQ? Issues And Questions

Mon Sep 28, 2015 7:20 am

CAPA used to do an annual CX vs SQ analysis
they do not do it anymore as CX is thrashing SQ
and CAPA has a bias against CX as CX refuses to launch an LCC...

SQ should have stuck to its core business and competed with the LCC's on service, like CX has done

ever since CX acquired KA, CX jumped ahead
before they were neck and neck

CX also has not been hit as hard by ME3
and has a an even greater premium capacity than SQ
and more cargo to rely on...

SQ is however smart to launch an airline in India...
so to say they are not growing is silly

CX management are way to conservative to think like SQ in terms of investment...

Changi is still trying to be Asia's largest international airport... no where near HKG

Quoting olympic472 (Reply 24):
 
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frigatebird
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RE: What's Up At SQ? Issues And Questions

Mon Sep 28, 2015 11:11 am

Quoting LAXintl (Reply 22):
o SQ will remain about same size.

Not so sure that's the plan. SQ has 63 A359s and 30 78Xs on order to replace 30 77E/773s and 31 A333s. That will be a growth of 32 aircraft. It's going to be interesting on which new routes or additional frequencies those will be used...

77W replacement hasn't been decided yet, so if necessary SQ could use part of their A350 order (they have conversion rights to -1000s) for that purpose, and they could also place some of their 78X order with Scoot, although all 30 seems somewhat excessive. But I do believe SQ wants to grow again with their new aircraft - but the competition will have new aircraft too by then...
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mercure1
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RE: What's Up At SQ? Issues And Questions

Mon Sep 28, 2015 2:19 pm

Quoting olympic472 (Reply 27):
My response was to "brand Singapore" being responsive. I prefer to say selective responsiveness, as the buses were safe and licensed (but not by Singapore's standards). You confirmed what I was trying to point out. Read it any way you wish though.

Why should Singapore allow coaches in which might not be compliant with regulations? Same way US wont allow in compliant coaches from Mexico.
There are dozens of existing Malaysian transport companies that do work in Singapore, maybe Air Asia should have worked with one of those?

Doing business in Singapore is rather simple, but like any nation its full or rules. Comply and it OK, dont comply and answer will be no.

Quoting frigatebird (Reply 29):
Not so sure that's the plan. SQ has 63 A359s and 30 78Xs on order to replace 30 77E/773s and 31 A333s. That will be a growth of 32 aircraft. It's going to be interesting on which new routes or additional frequencies those will be used...
77W replacement hasn't been decided yet, so if necessary SQ could use part of their A350 order (they have conversion rights to -1000s) for that purpose, and they could also place some of their 78X order with Scoot, although all 30 seems somewhat excessive. But I do believe SQ wants to grow again with their new aircraft - but the competition will have new aircraft too by then..

Its already been stated that by Scoot CEO Wilson that the carrier could use the -10 in addition to having absorbed SIA 787-9 order, so depending on what Scoot is doing in 2018-2019 its quite possible some frames go there.

In addition yes the 25+ 77W will also need replacement, they will be becoming 'old' by SQ standards with oldest frames having reached 9 years of age in 2015 now.

I think SQ sits in good position to either grow by retaining old frames longer, or remain about same size by transferring frames to others like Scoot and beginning 77W exit.
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kaitak
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RE: What's Up At SQ? Issues And Questions

Mon Sep 28, 2015 4:41 pm

Quoting Kashmon (Reply 28):
SQ should have stuck to its core business and competed with the LCC's on service, like CX has done

I think you need to see the bigger picture here; CX holds much more sway over the authorities in HKG than SIA does in SIN. Open skies and a liberal approach to airline regulation and access is a fundamental aspect of Singaporean govt policy; SIA recognised that and it had a choice: ignore it and get run over, or get with the game and invest in it. It wasn't really much of a choice and SIA hasn't done too badly out of it. Singapore, on the other hand, has done very well out of it. And deservedly so.

HKG, although it is served by LCCs, isn't a base for any of them; why do you think HKG rejected Jetstar's application? Because CX lobbied hard against it. Sure, CX wins, but which is the cheaper market to visit and to access? Singapore. Which one wins in the long term, economically? Singapore.
 
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LAXintl
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RE: What's Up At SQ? Issues And Questions

Mon Sep 28, 2015 5:10 pm

Quoting frigatebird (Reply 29):
Not so sure that's the plan.

Per my dealings with SIA executives, they have stated they dont see SQ growing much the next 5 years or so. Sure there might be some +/- movement, and some network adjustments to places like Europe but fleet count in low 100s seems to be the goal and comfortable size for them.

Bulk of growth in the SIA group will be from MI, TR and TZ.

Quoting kaitak (Reply 31):

  

Per CAPA LCC penetration in SIN is 31% of market seat capacity at the end of 2014. HKG was mere 8%.

So its indeed correct to say that its apples and oranges for SQ-CX as they face quite different market dynamics at their home airports.
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747megatop
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RE: What's Up At SQ? Issues And Questions

Mon Sep 28, 2015 5:55 pm

Quoting MaverickM11 (Reply 18):
There's quite a lot of growth all over the region;

Absolutely. But the growth areas in the region are very much reachable point-to-point by bypassing SIN. Why would KUL-PEK or CGK-AND OLD: Hong Kong - Kai Tak International (HKG / VHHH) (closed), China - Hong Kong">HKG or AND OLD: Hong Kong - Kai Tak International (HKG / VHHH) (closed), China - Hong Kong">HKG-SYD/PER want to connect through singapore unless fare through singapore are much cheaper? They would rather just go non stop as all these flights are under 10 hours..

Quoting MaverickM11 (Reply 18):
it has less to do with geography and more to do with a product that is increasingly disconnected with the region it serves.

Let's not pretend that product is everything. SQ is light years ahead in terms of in-flight and on the ground (in-terminal experience) product compared to US3 and crappy airlines like AF, AI etc. They are very much up there along with CX, LH, BA for example. An in terms of just the Changi airport (the airport experience...the "product" if you will) is & has been the gold standard and the de-facto benchmark to beat since the early 80s and is/was far ahead compared to let's say a crappy dump like LHR before LHR's T5 came along..don't even get me started about AF and it's CDG hub which many people avoid like the plague unless they have to connect there.

Now, if we were to hypothetically move Singapore, the city state, along with it's Changi airport, it's people & it's airline to let's say near DXB to capture the Australia-Europe traffic AND India-US/Europe traffic both at the same time then it would take all of subsidized ME3 efforts to counter SQ.
If SQ is allowed to fly limitless transatlantic service with full anti trust immunity between LHR & US or CDG & US then they would definitely be far ahead in terms of product (& market share) compared to the crappy service that most of the airlines (except perhaps LH & BA) dish out. The hub airports on either side of the pond are no match for SIN (or even AND OLD: Hong Kong - Kai Tak International (HKG / VHHH) (closed), China - Hong Kong">HKG for that matter) so SQ will have to live with that.
 
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RE: What's Up At SQ? Issues And Questions

Mon Sep 28, 2015 6:54 pm

Quoting 747megatop (Reply 33):
SQ is light years ahead in terms of in-flight and on the ground (in-terminal experience) product compared to US3 and crappy airlines like AF, AI etc.

The problem is that it's not about product. Those "crappy US carriers" are generating higher average fares on many routes that compete with SQ, even to SIN. The ME3 and LCCs aren't winning traffic on product but on cost. SQ's 77Ws have less than 270 seats. EK's least dense 77Ws have almost 100 more seats.

Quoting 747megatop (Reply 33):
But the growth areas in the region are very much reachable point-to-point by bypassing SIN.

Even in SIN, SQ has grown seats about 18% in the last five years, while the non SQ Group carriers have grown above 30%.

Quoting 747megatop (Reply 33):
Now, if we were to hypothetically move Singapore, the city state, along with it's Changi airport, it's people & it's airline to let's say near DXB to capture the Australia-Europe traffic AND India-US/Europe traffic both at the same time then it would take all of subsidized ME3 efforts to counter SQ.

Those carriers have 350-400+ seat 77Ws. SQ would need to follow suit or be vaporized in the process.

Quoting LAXintl (Reply 32):
Bulk of growth in the SIA group will be from MI, TR and TZ.

Their LCC/regional approach has been a mess in contrast to the mainline SQ operation; three management teams, three operations, none of them particularly well plugged into the network and all cannibalizing each other to a certain extent. I think SQ would be far better off dipping into the high volume, low fare traffic to bolster the network than shunting it off onto TZ and TR.
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a380787
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RE: What's Up At SQ? Issues And Questions

Mon Sep 28, 2015 7:10 pm

Quoting LAXintl (Reply 15):

What you should ask -- whats up with United and -- SQ, TG, TK, MS, etc..

Remember it takes two to tango and United has shown its far from friendly to non-JV partners. If anything its folks like United that are making Star Alliance a select club within a club.

UA has been reasonably friendly to NZ, AV, CA, OZ etc, none of which are part of the little JV club. MS doesn't really anything useful for UA, and TK's bottom barrel fares would be a pain to any partner.

Quoting MaverickM11 (Reply 34):

Their LCC/regional approach has been a mess in contrast to the mainline SQ operation; three management teams, three operations, none of them particularly well plugged into the network and all cannibalizing each other to a certain extent. I think SQ would be far better off dipping into the high volume, low fare traffic to bolster the network than shunting it off onto TZ and TR.

I see them having too many brands and offerings. They wanted a 2x2 matrix of short/long haul and LCC/FSC, with each carrier filling in exactly one spot. Problem is that SIN is a 5M island, so there's only so much product differentiation you can do before you start cannibalizing your own traffic. CX is a lot cleaner in that regard with a straight forward CX+KA offering.
 
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DolphinAir747
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RE: What's Up At SQ? Issues And Questions

Mon Sep 28, 2015 9:33 pm

Quoting a380787 (Reply 35):
CX is a lot cleaner in that regard with a straight forward CX+KA offering.

Yeah, with the exception of HKG-PEK/PVG the CX/KA boundaries are well defined and have no overlap just like SQ/MI. However TZ/TR cannibalize much of SQ, since not everyone is able to fly SQ Suites, while CX is immune to that damage.
 
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RE: What's Up At SQ? Issues And Questions

Mon Sep 28, 2015 10:22 pm

Quoting MaverickM11 (Reply 34):
The problem is that it's not about product.

Whaaat? You just said -

Quoting MaverickM11 (Reply 18):
and more to do with a product that is increasingly disconnected with the region it serves.

Reply 34 and reply 18 totally contradict each other 100%  Wow! .

Quoting MaverickM11 (Reply 34):
on many routes that compete with SQ, even to SIN.

What many routes? Only UA and DL fly their metal, that too only through NRT. AA doesn't even fly there.
SQ flies it's metal to SFO (twice daily), LAX, IAH & JFK; quite impressive for a small city state. Do you have any numbers to back up this statement of yours?

Quoting MaverickM11 (Reply 34):
Those "crappy US carriers" are generating higher average fares
 
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RE: What's Up At SQ? Issues And Questions

Tue Sep 29, 2015 2:06 am

Quoting 747megatop (Reply 37):
Reply 34 and reply 18 totally contradict each other 100%   .

Uh no. SQ has an excellent product that is out of touch with what passengers in the region want (#18), because product is not driving purchasing decisions, but pricing (34). Hence the minimal growth on the SQ side, huge growth on the LCC/ME3 side, and the skepticism that doubling down on high yield traffic with premium economy and even lower density seating is a long term solution.

Quoting 747megatop (Reply 37):
What many routes?

Pretty much all of them, except for the intra Asia tags. FRAJFK, HKG/ICN/NRT-US, you name it. Everywhere but SIN, SQ is a point to point carrier, and they have little leverage to fill seats other than lower fares.
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flythere
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RE: What's Up At SQ? Issues And Questions

Tue Sep 29, 2015 9:02 am

Quoting kaitak (Reply 31):
HKG, although it is served by LCCs, isn't a base for any of them

UO (HK Express) is apparently one, and they are growing real fast.

Quoting LAXintl (Reply 32):

Per CAPA LCC penetration in SIN is 31% of market seat capacity at the end of 2014. HKG was mere 8%.

So its indeed correct to say that its apples and oranges for SQ-CX as they face quite different market dynamics at their home airports.

Of that 31% market share for LCC, how much of it is created by SQ itself on its own backyard? SQ creates (largely) the current dynamics that they are having.

Quoting DolphinAir747 (Reply 36):
Yeah, with the exception of HKG-PEK/PVG the CX/KA boundaries are well defined and have no overlap just like SQ/MI. However TZ/TR cannibalize much of SQ, since not everyone is able to fly SQ Suites, while CX is immune to that damage.

Cannaibalism is always true. And setting up a multi-subsidary-empires post much management problem. That's the reason why CX/KA reluctant to allocate new resources to set up an LCC to burn their own backyard.
The justifiable point: HKG is like LHR, with only two runways, both a lucrative market with high landing/operating cost due to precious slots, only FSC could successfully tap into the market and have control. I would be surprised to see a LCC in LHR, the same goes to HKG.
But for SIN, they got more runways (slots), they want SIN to grow in pax number, dumping capacity by means of LCC is the way to go.
 
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RE: What's Up At SQ? Issues And Questions

Tue Sep 29, 2015 11:11 am

Quoting flythere (Reply 39):
Of that 31% market share for LCC, how much of it is created by SQ itself on its own backyard? SQ creates (largely) the current dynamics that they are having.

Per CAPA as of Feb 2015, with about 1.9mil monthly LCC seats in SIN about 680,000 belong to SIA family (TR+TZ)

Anyway you slice it, the LCC penetration is big in SIN, with some of the largest operators at the airport being outside LCCs - Jetstar, Air Asia, Lion Air.
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infinit
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RE: What's Up At SQ? Issues And Questions

Tue Sep 29, 2015 2:21 pm

Quoting kaitak (Reply 31):
I think you need to see the bigger picture here; CX holds much more sway over the authorities in HKG than SIA does in SIN. Open skies and a liberal approach to airline regulation and access is a fundamental aspect of Singaporean govt policy; SIA recognised that and it had a choice: ignore it and get run over, or get with the game and invest in it. It wasn't really much of a choice and SIA hasn't done too badly out of it. Singapore, on the other hand, has done very well out of it. And deservedly so.

HKG, although it is served by LCCs, isn't a base for any of them; why do you think HKG rejected Jetstar's application? Because CX lobbied hard against it. Sure, CX wins, but which is the cheaper market to visit and to access? Singapore. Which one wins in the long term, economically? Singapore.

  

An excellent summary of the differences in the circumstances SQ and CX face. Coudn't have put it better.

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