Air Asia laughing at SIA for recruiting loads of FTrashs...

[Windsor]

==
the airline industry is still very protected. For this JV between ANA and AA - ANA will be the majority shareholder - to render it a "jap airline" owned either by Japanese individual or person. that the rule of the airline industry - which is unlike other industries, you can outright buy over a foreign entity and operate it in their home country. In airlines, nope.

Landing rights are negotiated on a country to country level - and then allocated by the country - and this is split to 1st, 2nd...5th landing rights. 5th landing rights is effectively open-sky, and you can form a hub to do whatever you like in their country. So, for example Singapore has open skies with US. Technically speaking, both countries can mount unlimited flights btw one and another - subject to landing capacity of the target airports (ha - a catch). But as we know, SIN-US direct flight is not profitable - which is why Singapore is eyeing the Aust-US route that we have crave so long. We can fly to Aussie land - which, if i am not wrong, encompass 1st, 2nd and 3rd landing rights. But Aussie stubbornly refuse to grant 4th and 5th landing right.

So, these JVs that AA formed with Thai / Japan - will be fronted by Thai company and Jap company respectively. The rule is, the JV entity must be majority owned by that country's national - e: Thai and Japanese respectively.

So in this case of ANA-AA tie-up, to the Japanese consumers - it will be a Jap company. Yes, Japan is a long time luxury conscious country - they are willing to pay the top price for top quality. In SIA's case, this used to be a cash cow - but no longer so, given the state of the economy. And i believe AA spotted this trend.

Why AA is so successful is that the founder is able to circumvent red-tapes and stuff. At that time where AA was created, Singapore was apprehensive - and not very sure whether to have their own budget airline or switch Silkair to become a budget airline. As always the case when we do things, we make case studies, we create project teams,...whereas others will simply forge ahead.

Thank you for the input and confirmed exactly what my guess was re-JV of AA and ANA. As I mentioned earlier, no country will surrender their sovereignty by allowing a foreign entity to operate their airport as a hub. This Cestbon is talking rubbish and shows lack of knowledge on how an airline operates.

Singapore has problems as they need to support SIA fully and will seek SIA's consent if they want to negotiate with other countries on behalf of airlines not part of SIA. With the monopoly of SIA on all routes to and from Singapore, there is little room for other airlines to expand their services to other countries, apart from places that SIA do not wish to service. SIA and it's subsidiaries has to survive and be profitable no matter what, therefore it is no surprise the other local airlines are struggling just to survive. Those who are foolish enough to want to take up the challenge faced the risk of failure.

 

[Windsor]

Can show some examples of how the government is meddling in SIA coz I can't find any

LKY have always stated he is taking a hands off approach on SIA. To him, Changi Airport is more important then SIA. I'm pretty sure they have more then once meddle in Changi Airport matters but I can't find too much news on SIA. In which case, even if they did, SIA's brand name, Stature as an Airline and profits more then justify whatever they are doing. At the very least if anything, SIA can be consider our biggest worldwide brand

Do not be blinded by what you read. SIA is an airline that is owned by the government. Why do you think LKY needs to meddle in it's affairs? Changi Airport and SIA has a symbiotic relationship, one cannot survive without the other. If you read carefully, LKY said he will close down SIA and set up another one to replace it. Just a change of name, nothing really changed except dismiss all employees and re-negotiate employment agreements.

When ST formed ST Aviation services Co (SASCO), SIA was reluctant to support ST. There was jealousy, rivalry between SASCO and SIA Engineering. Without government assistance and interference to get SIA to shove it, SASCO will not survive.

 

[red amoeba]

Thank you for the input and confirmed exactly what my guess was re-JV of AA and ANA. As I mentioned earlier, no country will surrender their sovereignty by allowing a foreign entity to operate their airport as a hub. This Cestbon is talking rubbish and shows lack of knowledge on how an airline operates.

Singapore has problems as they need to support SIA fully and will seek SIA's consent if they want to negotiate with other countries on behalf of airlines not part of SIA. With the monopoly of SIA on all routes to and from Singapore, there is little room for other airlines to expand their services to other countries, apart from places that SIA do not wish to service. SIA and it's subsidiaries has to survive and be profitable no matter what, therefore it is no surprise the other local airlines are struggling just to survive. Those who are foolish enough to want to take up the challenge faced the risk of failure.

==

negotiations of landing rights - as with all negotiations - is an exchange of benefits - just that the skill of negotiators determine who gets "more" benefits. Thats why one sore point by Singapore regarding Aussie-US route is that we allow Quantas to hub here during the initial negotiations but we were not allowed to hub there. So, when they try to nego for Aussie-US, Aussie tell us, what you have to offer me? Nothing, bcos Quantas already squatting here, nothing else more we could offer them. Which is why they can afford to be high handed.

It is not exactly true that MOT favors SIA, under the goal for Asean Open Skies by 2014, Singapore-KL route has been liberalised - it has for many years monopolised technically by SIA charging nearly 300 dollars two-way. When MOT negotiated landing rights - they decide then who to pass this landing rights to. Usually, favorable landing slots or international slots are handed to SIA (obvious because she is the national flag carrier). But for this case like SIN-KL, to open up more competition and show the everyone else that we play fair, MOT pass the slots to JetStar & Tiger.

Negotiated landing rights include factors such as number of passengers allowed per flight, number of flights, number of minimum flights guaranteed, etc. Then depending on these factors, MOT decide who to pass the landing rights to. Obviously, if MOT negotiated a 300-passenger per flight, 3 flights per week schedule to say, Hokkaido. The only candidate to get this right is SIA. But SIA may on commercial grounds decide not to take this option - and there will be no flights. But of course SIA and other airlines are always in contact with MOT to lobby for routes / landing rights --> telling MOT what routes they like and MOT to negotiate for landing rights.

 

[Windsor]

==

negotiations of landing rights - as with all negotiations - is an exchange of benefits - just that the skill of negotiators determine who gets "more" benefits. Thats why one sore point by Singapore regarding Aussie-US route is that we allow Quantas to hub here during the initial negotiations but we were not allowed to hub there. So, when they try to nego for Aussie-US, Aussie tell us, what you have to offer me? Nothing, bcos Quantas already squatting here, nothing else more we could offer them. Which is why they can afford to be high handed.

It is not exactly true that MOT favors SIA, under the goal for Asean Open Skies by 2014, Singapore-KL route has been liberalised - it has for many years monopolised technically by SIA charging nearly 300 dollars two-way. When MOT negotiated landing rights - they decide then who to pass this landing rights to. Usually, favorable landing slots or international slots are handed to SIA (obvious because she is the national flag carrier). But for this case like SIN-KL, to open up more competition and show the everyone else that we play fair, MOT pass the slots to JetStar & Tiger.

Negotiated landing rights include factors such as number of passengers allowed per flight, number of flights, number of minimum flights guaranteed, etc. Then depending on these factors, MOT decide who to pass the landing rights to. Obviously, if MOT negotiated a 300-passenger per flight, 3 flights per week schedule to say, Hokkaido. The only candidate to get this right is SIA. But SIA may on commercial grounds decide not to take this option - and there will be no flights. But of course SIA and other airlines are always in contact with MOT to lobby for routes / landing rights --> telling MOT what routes they like and MOT to negotiate for landing rights.

I quite agree with you on this except Sin/KL route. SIA has many large aircraft and it is not profitable for it to fly to KL at less than what they were charging. The same applies to Malaysia if they were to reduce their airfares. The flight is so short that after taking off passengers were told to be ready for landing.

Aircraft has to perform maintenance schedules periodically. The schedule dictates when the aircraft should be taken out of service and into the maintenance bay for some time depending on which checks needs to be performed. Either the aircraft is approaching it's maximum landing cycles or it's maximum flying hours whichever comes first, then it will have to go for maintenance. If an aircraft flies to Taipei and lands and take-off, it is one landing cycle. If it does that on the Sin/KL route it is also one landing cycle one way. Therefore a wide-body aircraft loses out to a smaller aircraft in operating very short routes. Needless to say that taking off and landing burns a lot of fuel too.

Hope this explains why it is better to allow budget airlines to operate and why MAS suffers losses servicing unpopular domestic routes.

 

[scroobal]

Not quite. Even though SIA as National carrier gets privileges, the Govt has always focused on the value of Singapore geographic position as hub and maintenance centre. Freedom rights were negotiated along these lines and explains why the kangaroo route were granted to both the British and OZ. Its called a multiplier effect.

We adopt the same approach for port and financial services. Local companies such as NOL and DBS are not given special rights just certain privileges. Interestingly GLCs are protected against local companies and explains why DBS have special right against UOB etc. The exception is when we deal with the Malaysians who always act directly for the company such as MAS. Thus the arrangements are pretty much mirrored.

It thus leads to a situation where foreign airlines are given access rights but no licence is given to local company without Temasek's consent and support. Value air is an example. Temasek had to agree and there was some level of funding from them.

Singapore has problems as they need to support SIA fully and will seek SIA's consent if they want to negotiate with other countries on behalf of airlines not part of SIA. With the monopoly of SIA on all routes to and from Singapore, there is little room for other airlines to expand their services to other countries, apart from places that SIA do not wish to service. SIA and it's subsidiaries has to survive and be profitable no matter what, therefore it is no surprise the other local airlines are struggling just to survive. Those who are foolish enough to want to take up the challenge faced the risk of failure.

 

[da dick]

aussie jetstar laugh at us nevermind, but m&ds laughing at us, we must have big problem.

 

[myo539]

The founder of Malaysia’s low cost carrier Air Asia Mr Tony Fernandes was amused at Singapore Airlines’ pro-foreigner hiring policies. He tweeted last night: “Funny how SIA keeps putting foreigners in charge at their ICC (low cost carrier). Don’t they have faith in Singaporeans. I do. My Commercial Head is a Singapore. Odd company. If I were a Singaporean, I would really be upset with SIA.”

Not surprising! In Malaysia, they practise the BUMIPUTRA policy - Malay first! That's why the talented Chinese flee to other countries.