Singapore Airlines Flies Forward into Competition

Singapore Airlines (SIA) is expanding its capacity even as competition pressures its profits. The airline’s CEO, Goh Choon Phong, highlighted growth opportunities in places like India and Southeast Asia.

Despite increased flights, SIA earned less per passenger in the quarter ending September 30. Competition meant more seats than passengers, dropping SIA’s net profit by 59% to $290 million compared to last year.

Rising costs didn’t help either; expenses climbed nearly 15% with inflation pushing up non-fuel costs by 16.6%.

SIA’s chief commercial officer, Lee Lik Hsin, noted that airfares, or “yields,” are moderating across all classes. Yet, per-passenger revenues still sit above pre-pandemic levels, showing some resilience.

Looking ahead, SIA expects challenges like increased fees at Changi Airport to impact operating costs.

However, passenger demand remains solid, with the airline’s load factor at 86.4% from March to September.

Scoot, SIA’s budget arm, is adding routes, enabled by new Embraer E190-E2 jets. Supply chain delays, though, are affecting deliveries, including Boeing and Airbus models.

In November, SIA announced a $1.1 billion project to upgrade its Airbus A350 seats, delayed due to Boeing’s 777-9 setbacks. Mr. Goh remains confident in SIA’s premium offerings, which aim to set a high standard.