Singapore Airlines unfazed by Qantas competition

Singapore Airlines is confident the global carrier can withstand the increased competition from Qantas.

Goh Choon Phong, Singapore Airlines CEO.

Singapore Airlines chief executive Goh Choon Phong is confident the global carrier can withstand the increased competition Qantas will bring to the region by now stopping in Singapore.

Qantas’s move to re-route its Sydney-London A380 services to stop over in Singapore rather than Dubai will begin in March next year. The decision was made earlier this year when Qantas renewed its Emirates deal but decided to stop flying through Dubai on the popular ‘‘kangaroo route’’.

Singapore Airlines will announce its first half profit this week and analysts expect a positive result after the carrier flagged a positive result after a strong start to the year.

The airline posted a $S241 million ($230m) first quarter profit, a strong turnaround from a surprising $S138 million loss three months earlier.

Singapore is hoping to protect its luxury market share by rolling out a redesigned cabin on its A380 flights from December.

Mr Goh said the airline was not concerned that it would soon face increased competition from Qantas on the Australia to Singapore routes. “Australia we have a huge presence, it’s a very important market for us, we have a very good partner in Virgin Australia so I think we are going to keep looking for growth opportunities there,” Mr Goh told The Australian.

“We compete all the time, we have many international airlines flying into Singapore and Qantas will be one of those, competition isn’t new for us.”

Singapore Airline’s senior vice-president Marvin Tan said ­demand for upper class travel could be linked to the global economic and stockmarket performance, especially for its corporate customers.

The airline last week revealed a $US850 million ($1.11bn) upgrade of the interior cabins on its A380 fleet which will come into effect in December. It also reduced the number of first class suites from 12 to six. “When you look at our segment of first class passengers you have the independent travellers and they are independently wealthy and make their own decisions. They will still continue to travel the way they want to,” he said.

“If you look at the corporates some still travel first class, some have changed to business class but these things don’t stay static. As companies get bigger and grow, things also change for them.

“I think generally demand and conditions consistent, unless there are big shocks to the market like the GFC, then we have to be prepared to manage that situation.

“But generally when ups and downs happen during the course of a year its something that we can manage. We can look at what different aircraft we can use and what type of service we offer so that helps us match the supply with the demand.”

Singapore Airlines will take delivery of five new A380s in the next few months and will return five of the older model aircraft back to its lessor. It will maintain a fleet of 19 A380s, the second largest in the world behind Emirates.

The reporter flew as a guest of Singapore Airlines.