Singapore Airlines (SIA) yesterday launched a long-haul budget carrier that will fly to Australia and China with longer-term ambitions to reach Europe as the region’s market for no-frills travel booms.
Scoot will begin flying from the middle of next year with a fleet of four Boeing B777-200 aircraft bought from parent company SIA and will fly to Australasia, China and other destinations. Specific cities will be announced over the coming months.
Company executives expect Scoot to tap into growing demand for low-cost travel over longer distances as most of Asia’s low-cost carriers cover short-haul routes.
Photo: EPA
The airline will charge up to 40 percent less than regular carriers and plans to have 14 planes by 2016, with longer-term plans to fly to India, Europe, Africa and the Middle East.
In Asia, Scoot is expected to compete directly with AirAsia X, the long-haul affiliate of Malaysian budget carrier AirAsia and British tycoon Richard Branson’s Virgin Group.
It is “not an everyday airline name because this is not an everyday airline,” CEO Campbell Wilson told a news conference. “We are very purely a no-frills model.”
Wilson said after the news conference that Scoot is unable to fly to the US initially because of the B777-200’s limitations, but he was not ruling out serving the US market in the future.
“We see [that] this new market segment is already a significant market segment that’s growing fast and so by setting up this airline, by positioning it the way we are, we aim to bring new business to the SIA group,” Wilson said.
“Taking over the routes of SIA is not the intention of Scoot. We’re targeting a new growing market. We’re aiming to bring incremental business to the SIA group, not to take over existing routes,” he added.
MENDING FENCES
Meanwhile, Australia’s -Qantas Airways plans to cut fares and launch an advertising blitz to win back passengers, a newspaper said, after its showdown with unions caused international travel chaos and left almost 70,000 travelers stranded.
Qantas flights returned to normal yesterday for the first time since it grounded its global fleet over the weekend, a deliberate tactic to gain the upper hand over trade unions in a long-running and costly labor dispute.
The tactic succeeded in spurring local authorities to order an end to all industrial action on Monday and should ensure a speedy resolution, but it also hurt the Qantas brand and left many passengers vowing to shun the airline.
Aviation and brand experts say Qantas has a huge job to restore confidence in its brand, which has traditionally stood for safety and reliability.
“Qantas will cut prices across its international and domestic network, offer grounded passengers special promotional deals, and take out one of the biggest national advertising campaigns in its 90-year history in a bid to win back disenchanted travellers in the lead-up to the peak Christmas period,” the Australian Financial Review said.
Qantas also planned to temporarily double the rate of frequent flyer points earned, the newspaper said in its unsourced report.
A Qantas spokeswoman described the newspaper report as speculation, but said the airline was apologizing to passengers.
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