The airline cited the relaxation of travel restrictions in Hong Kong, Japan and Taiwan to boost air travel demand and support a recovery in those markets.
While impressive, passenger numbers are still 76 percent of the December 2019 figure of 3.54 million passengers carried.
SIA’s passenger load factor (PLF) was 89.7 percent for the month in December 2022 – up 3.8 percentage points from a month ago and up 43.2 percentage points year-over-year. The airline noted that this is the highest monthly PLF in SIA history, full-service carrier, SIA and low-cost carrier, Scoot posted record monthly PLFs of 89.1 percent and 91.6 percent, respectively. PLF for December 2019 was 87.6 percent.
However, it should be noted that PLF is a function of the number of aircraft an airline has in service. In this period when there is a global shortage of capacity, some
According to fleet data from ch-aviation.com, SIA currently has 36 inactive aircraft between its two main airline brands. The aircraft on the ground include 15 Boeing 777ERs, two Airbus A350s, two A380s and two 787-8s.
With increased competition in the coming year and China reopening after COVID-19 lockdowns, airlines in Northeast Asia are expected to bring more capacity to the air, which would result in supply depressing prices. SIA is expected to do the same to compete for market share.
As early as December, Scoot resumed flights to Zhengzhou, China in December 2022, while SIA resumed bi-weekly passenger services from Singapore to Beijing on December 30, 2022.
While the Chinese market is still slowly recovering, SIA has been expanding its capacity in India, an important market, since the middle of last year. SIA has already resumed flights to the following South Asian cities with frequencies matching or exceeding pre-C levels: Bengaluru, Chennai, Delhi, Dubai, Hyderabad, Kathmandu, Kochi, Kolkata and Mumbai.
To underline the strategic importance of the Indian market for SIA, it pledged at the end of last year to continue investing in the market.
On November 29, the airline announced it was converting its 49 percent stake in Vistara to a 20 percent stake in the new
The airline said in a statement: “Through this transaction, SIA will strengthen its partnership with Tata and immediately acquire a strategic stake in an entity four to five times larger than Vistara. The merger would strengthen SIA’s presence in India. strengthen its multi-hub strategy and enable it to directly participate in a large and fast-growing aviation market.”
When Tata Sons agreed to buy Air India, the acquisition was completed a year ago on January 27. Tata was expected to consolidate its aviation assets, which meant it was likely to merge Vistara with Air India. SIA could have stopped its investment in the Indian market and sold its 49 percent stake in Vistara. However, it decided to take a minority stake in a larger airline, and here are some of the possible reasons.
First of all, the new Air India Group will become a much bigger player in the Indian aviation market. The four carriers will have a market share of 26 percent by domestic seat capacity and 21 percent by international seat capacity in the current quarter, based on OAG data.
India as a market and source of travelers is of strategic importance to both SIA and Singapore in general. Over time, SIA will be able to increase its connectivity to Indian destinations and serve Indian passengers on international routes using Changi Airport as a transit point. This could open attractive destinations in other parts of Southeast Asia, Australia, New Zealand, North Asia and the West Coast of America to Indian passengers. With the massive opening of Terminal 5 in Changi in the middle of the next decade, any additional passenger turnover will be vital to ensure the airport’s expansion delivers on its promise.
India is one of the top three aviation markets in the world and is poised to double passenger traffic in the next 10 years, supported by rising income levels and continued investment in aviation infrastructure. It is expected to exceed 300 million air passengers by 2027. However, India also remains underserved with low international seats per capita, representing significant growth potential.
Another factor that SIA would have considered is that the CEO of the new Air India group is a trusted 25-year veteran of the company before joining the Indian airline in the middle of last year. Campbell Wilson, a New Zealander, was previously chief executive of Scoot and held various positions at SIA in countries such as Japan, Canada and Hong Kong, and served as senior vice president of sales and marketing for SIA.
As Fortune quoted, in a letter to employees on the one-year anniversary of the completion of Tata’s acquisition of Air India, he said: “All things considered, the progress over the past 12 months has been nothing short of astounding, even though so much of what we been working on has been behind the scenes, building platforms and capabilities so that our future aspirations can take off, of course there’s a lot more that needs to be done, and everyone, both internally and externally, is hungry for us to do it.”
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