SIA: no-frills no threat

ANDREW DOYLE / SINGAPORE

Singapore Airlines (SIA) could rapidly adapt its regional subsidiary SilkAir to meet any threat from no-frills carriers attacking the Asian market, but such a scenario remains unlikely because of the slow pace of liberalisation, according to the airline's deputy chairman and chief executive Cheong Choong Kong.

Cheong says SIA has looked "in depth" at setting up a no-frills airline but has concluded that the business model being successfully exploited by the likes of EasyJet, Ryanair and Southwest Airlines would not necessarily work in Asia's "very regulated market". Cheong adds: "You have to have the traffic rights and a lot of the traffic rights to all the points we want to fly to have largely been exhausted."

Another factor is that the established flag carriers in Asia already offer lower fares than their US and European counterparts did before the no-frills carriers emerged. Cheong says SIA is prepared to meet any low-cost threat, possibly with a no-frills version of SilkAir, its full-service regional unit that flies nine Airbus narrowbodies. Meanwhile, SilkAir will launch a revamp in January to position itself as "SIA-lite", reports Flight International's sister publication TravelWeekly East.

Source: Flight International