As high fuel prices and disruption from the Middle East conflict force many Asian carriers to cut capacity and rearrange routes, Singapore Airlines (SIA) is moving in the opposite direction: adding long-haul flights to Europe in a bid to capture traffic from its Gulf rivals.
Aviation analysts said the carrier’s expansion reflected a rare combination in the region: a strong balance sheet, insulation from sudden jumps in fuel prices due to its hedging strategy and a hub in Singapore that could help capture premium Asia-Europe traffic diverted from Gulf carriers such as Emirates, Qatar Airways and Etihad Airways.
The opening may be narrow for SIA to increase its market share, with Middle Eastern airlines gradually restoring capacity and fuel costs remaining elevated, according to the analysts.
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SIA announced on May 8 that it would increase services from Singapore to Manchester, Milan, Munich and London Gatwick from July, and launch a new service to Madrid via Barcelona five times a week in October.
Kadam Aggarwal, a partner at management consulting firm YCP who specialises in aviation, said the airline was executing a “demand capture counter strategy”.
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“As the Gulf carriers are struggling and ceding their market shares, SIA is trying to capture the market, especially the Europe connectivity, which has been elusive for the airline for very long. SIA’s move is to establish itself as a viable premium alternative to the Middle Eastern carriers with the hope of creating stickiness and loyalty among its customers,” he said.