Singapore shrugs off Qantas-Emirates alliance

2012-09-07 11:53

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Singapore - Singapore's Changi airport said Friday that it will remain a major hub for Qantas and other carriers despite the Australian airline's decision to shift its European connection point to Dubai.

Qantas said Thursday that flights from Australia to London and Frankfurt, and vice-versa, would stop running through Singapore from April 2013 as part of a new global alliance with the Dubai-based Emirates.

The Changi Airport Group said that despite the move Qantas was planning to step up connections between Australia and Singapore.

"We understand that Qantas faces challenges in its international business and needs to restructure its network," the Changi Airport Group said in an emailed response to queries from AFP.

Changi currently serves Qantas routes between Singapore and five Australian cities -- Sydney, Melbourne, Perth, Brisbane and Adelaide -- with a total of 90 flights per week.

The airport, which is still being expanded, serves about 100 airlines operating 6,200 weekly flights to 220 cities in 60 countries.

A spokesman for Singapore Airlines -- which competes with both Qantas and Emirates -- declined to comment on the new alliance.

"However, speaking entirely in general terms, we have faced competition since day one, so it is not unfamiliar to us," the spokesman told AFP, adding that the airline uses alliances to boost its network and offer connections for passengers.

Shukor Yusof, an aviation analyst with Standard & Poor's Equity Research, said Changi remains competitive as an aviation hub despite the impending loss of Qantas' Europe-bound services.

"It's not a huge blow. Changi will still remain an active participant more than anything else," he said, citing the Asian travel boom boosted by rising income levels and the emergence of regional budget carriers.

Some analysts, however, cautioned that the Qantas-Emirates deal could signal more serious competition in the longer term between Singapore and Dubai.

"This is a very bad sign for Singapore," said Jonathan Galaviz, managing director of business consultancy Galaviz & Co. which specialises in Asia.

"Singapore's position as an airline hub in Asia is going to be strongly challenged by Dubai over the coming years," he told AFP.

Data from Sydney-based industry monitor Centre for Aviation showed Qantas accounts for 8.2 percent of Changi's air traffic measured on an available-seat-kilometre (ASK) basis, second only to Singapore Airlines.

"Qantas is the second largest carrier by ASKs at Singapore Changi and while it may seek to increase local Australia-Asia traffic, Changi will lose Qantas' two daily A380 and single 747-400 service from Singapore to Europe," it added.

Qantas chief executive Alan Joyce said the carrier remains focused on serving Asian routes including Singapore.

"Qantas will increase dedicated capacity to Singapore, and re-time flights to Singapore and Hong Kong to enable many more ‘same day' connections across Asia," he said Thursday at the launch of the Emirates alliance. - AFP

Read more on:    flights  |  travel international

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