Singapore slip?

In our review of the airline’s last 747-400 flight we note that in 1993 the airline’s executives saw no need for the 777 – although they did wake up to its awesome potential a few years later.

The airline has also resisted the move to premium economy, telling Contrails that its economy class is as good as the premium economy of others, which is plainly not true.

Singapore Airlines also was a reluctant adopter of the LCC phenomenon sweeping South- East Asia and only moved when pressured by Jetstar Asia, not to mention AirAsia.

Its venture into Scoot also is a response to the success of AirAsia X in the longer-range LCC space.

In fact, in the past 10 years the airline possibly has lost a little of the right stuff when it comes to innovation – the factor that has made it great.

AirAsia Group CEO Tony Fernandes, on the announcement of Scoot, slammed Singapore Airlines as copying AirAsia X and saying SIA has to play catch up. Mr Fernandes then took another shot at SIA, saying the group had no creativity.

There also is no doubt Singapore Airlines, like many others, has suffered greatly from the rise and rise of Middle East airlines such as Emirates and Etihad and their superhubs – in particular Dubai.

Not surprisingly Singapore Airlines’ marketshare is declining.

In the financial year ended March 31 2011, it carried 16. 6 million passengers, up only 11 per cent from the number carried 10 years earlier, says CAPA – Centre for Aviation. That’s a paltry 1. 1 per cent growth rate.

In stark contrast the traffic through Singapore’s Changi Airport hub has leapt 32 per cent in the 10 years from 2000 to 42 million passengers, which equates to 3. 2 per cent growth.

That growth rate, while far better, is still off the pace for the region.

The global financial crisis (2008-10) hit Singapore Airlines hard with a 15 per cent slump in business because the airline had no premium economy product to which its business travellers could downgrade.

Over the same period Changi jumped 15 per cent thanks to AirAsia finally being given airport access. Its marketshare at Changi is now nudging seven per cent.

Sydney-based think tank CAPA says: “The flag carrier’s strategy over this period has clearly been to prioritise profitability over expansion, often a sound approach. But in the fast-growing Asian market this can be a risky long-term option, leaving the way for other competitors to expand and grow their network strength. ” Summing up at the announcement of Scoot, CAPA said that the long-haul LCC is “recognition that the flag carrier’s long-standing focus on premium traffic is not in itself a formula for the future”.

CAPA notes that the fastest growth is in tourism while business is expanding more slowly.

Singapore Airlines rose to prominence by being bold and snubbing its nose at convention by providing free drinks and free plastic ear plug headsets to passengers in defiance of IATA.

It then built its brand around the 747, pushing Boeing to improve the design to provide non-stop flights from Singapore to London.

A string of firsts or near firsts followed – seatback videos for economy, AVO, beds for business class – and the list went on throughout the 1990s. But that list, apart from being first with the A380, has all but dried up.

It’s time for the people behind the Singapore Girl to reinvent the airline and go back to what they have done best – turn the industry on its head. n