Last month Singapore Airlines launched the world’s longest flight between Singapore and New York’s Newark Liberty International Airport. The airline is currently in the midst of new aircraft deliveries, with the A350-900ULR playing centrepiece. While this may make the airline seem as though it is in the midst of rapid expansion, a number of factors could determine the airline’s future. In fact, It leads us to the question “How Much More Can Singapore Airlines Grow?”
Ultra Long Haul Competition
Singapore Airlines was the launch customer for the Airbus A350-900ULR. This specially modified version of the A350-900 is designed to carry passengers the ultimate distance. As such its prime route is between Singapore and New York. This flight is scheduled to take around 18 hours, making it the world’s longest scheduled commercial flight. This could be at jeopardy if Qantas gets their way, however. Qantas, the Australian flag carrier is determined to launch non stop services between London and Sydney within the next 5 years.
Qantas is currently looking at both Boeing and Airbus to improve the range of the B777x and A350-ULR respectively. Currently, the range of the A350-ULR falls just shy of safely operating flights to Sydney. However, Qantas does operate non-stop flights from London to Perth using the B787. Singapore’s A350-ULR has two classes. Premium economy and business. Qantas will likely have a similar story as the carrier recently told how they dropped their requirement for a 4 class cabin for the flight.
While a fair few passengers may use Singapore Airlines for the hop across to Sydney it is unlikely direct flights will severely impact them. The main reason for this is that unlike the middle east carriers which operate with transfers in mind, this isn’t Singapore’s main focus.
A350-900 Limited Success
In addition to the potential challenge of more ultra-long-haul flights, Singapore Airlines is also having to deal with a crisis of seating on the A350-900. Singapore Airlines has ordered 7 of the ULR edition of the aircraft. According to Reuters, a senior executive told of passenger loadings on the A350-900ULR. The aircraft has a two-class layout of 67 business class seats and 94 premium economy seats. While Singapore Airlines has had no issue selling business class tickets on the mammoth 18-hour flight from Singapore to Newark, the same cannot be said about the premium economy.
According to Reuters, data from the travel industry shows that time-sensitive business travellers will pay a 20% premium for ultra long-haul flights. This may be why business is having no problems with ticket sales, however, passengers don’t seem so keen to sit in a large economy style seat for 18 hours.
At a media briefing Singapore’s Commercial Executive Vice President, Man Swee Wah, told of the need further push the premium economy. “I think we need to continue to stimulate and encourage the market to consider this product. Initially with very attractive pricing, but eventually I think people will see that even at prices which we offer, it is a good product to purchase because it is a very long flight”.
Drop In Profits
On Tuesday Singapore Airlines reported an 81% drop in profits, partly due to the rising cost of fuel. If the airline’s expansion into the US with new routes such as Singapore to Seattle, doesn’t go to plan, this could taint the airline’s future expansion. While there is no doubt that the airline will continue to grow in the future, it is unclear if there will be a large expansion in the immediate future.
How big do you think Singapore Airlines can grow? Do you think the airline has almost peaked? Let us know in the comments down below!