SilkAir, SIA, low-cost, Asia, flights, airlines, routes, singapore airlines, merge, cabin, upgrade, lie-flat, business class, results, profit
SilkAir

SIA to upgrade – then merge with – SilkAir

The revelation comes a day after strong full-year results exposed SilkAir as a weak spot.

Singapore Airlines has revealed today (May 18) that it will spend more than S$100 million (€63 million) on cabin upgrades for its regional wing SilkAir – and eventually to merge it with the parent airline.

The move comes one year into Singapore Airlines’ three-year cost-cutting transformation programme, as competition from low-cost carriers and Chinese and Middle Eastern rivals intensifies, reports Reuters.

The news also comes a day after SIA beat market expectations by posting a 148% rise in full-year net profit to the highest level seen since 2011, as passenger revenues increase and the transformation programme yields early results.

But the same results show that SilkAir is a weak spot within the group, with a 57% drop in operating profit to S$43 million.

Its fare prices have been falling as it struggles to compete with rivals with even lower fares, such as AirAsia Group on routes to places like Kuala Lumpur and Bali.

Gap between products
SIA says that the cabin upgrades, which will start in 2020, will result in closer product and service consistency across the group’s full-service network, bringing in new lie-flat seats in business class, and seat-back inflight entertainment systems throughout the cabin.

Reuters remarks that the upgrade “will close a gap with rival Cathay Pacific Airways Ltd, whose regional arm, Cathay Dragon, operates jets with cabins more similar to its parent than the wider gulf between Singapore Airlines and SilkAir products”.

Related stories

Singapore Airlines reaches out to off-line markets

SIA to deploy “ultra-long range” aircraft

Price wars hit Singapore Airlines profits

SilkAir to order up to 68 new Boeings

x

Check Also

Pobeda Airlines, flights, route, new, Russia, Aeroflot, Gothenburg, Helsinki, low-cost, Moscow, St Petersburg

Two new Russia routes to Nordics

The two routes include the first low-cost flights from Russia to the Nordics and a red-eye from Sweden.

Primera Air, delay, postpone, flights, cancel, Birmingham, New York, London, long-haul, low-cost, complaints, compensation

Angry passengers say Primera must be investigated

Passengers say they turned up at the airport for a flight that had never even launched.

Norwegian, Brazil, cleared, low-cost, long-haul

Brazil clears Norwegian to operate flights

Flights to Brazil are "characterised by low competition and high prices. Norwegian Air intends to reverse that.”

Primera Air, delay, postpone, flights, cancel, Birmingham, New York, London, long-haul, low-cost, complaints, compensation

Primera Air forced to make more route cuts

The Nordic-owned carrier is ceasing eight short-haul routes from the UK, to Spain and Iceland.

Airlines will buy 42.700 new commercial aircrafts

Boeing estimates a huge demand for new aircrafts and services over the next two decades, mainly in the low-cost segment.

A350-900ULR, SIA, Singapore Airlines, Singapore, New York, longest, route, flights, world, Newark, LA, Qantas, United, Continental, ULR, ultra long range

Skytrax winner Singapore Airlines profit down 59 percent

High oil price and lower fares hit the bottom line for the best airline in the world.