By: Air Traveller PH
Singapore Airlines is cutting its capacity by 96% in which it considers the CoviD-19 pandemic as “the greatest challenge that the SIA Group has faced in its existence”. The SIA group is grounding 138 of 147 aircraft of Singapore Airlines and Silk Air, leaving only 9 aircraft operational which will be in-effect until end of April.
Low-cost subsidiary Scoot is only keeping two of its 49 aircraft operational.
In a report from FlightGlobal, SIA said, “the SIA Group diversified its network and set up Scoot to spread its risks and cater to a wide range of passenger and market segments. However, without a domestic segment, the group’s airlines become more vulnerable when international markets increasingly restrict the free movement of people or ban air travel altogether."
“It is unclear when the SIA Group can begin to resume normal services, given the uncertainty as to when the stringent border controls will be lifted."
“The resultant collapse in the demand for air travel has led to a significant decline in SIA’s passenger revenues," it said.
Singapore Airlines also said that it has taken "steps to build up its liquidity, and to reduce capital expenditure and operating costs." The airline is also pursuing aggressive measures to mitigate the impact of the CoviD-19 which include a voluntary leave without pay scheme from staff to a certain level of seniority.
The airline is in discussion with aircraft manufacturers to upcoming deliveries. The SIA group has a present aircraft order of 150 aircraft where 68 orders are from Singapore Airlines, 31 from Silk Air, and 51 from Scoot. For the case of Silk Air, aircraft orders are Boeing 737 MAX 8 aircraft which up to this moment are still grounded pending certification from the FAA that the aircraft is already fit to return to passenger service.
The SIA group also said, “the company continues to explore measures to shore up its liquidity during this unprecedented disruption to global air travel. The company will release further details when such measures have been firmed up.”
The CoviD-19 crisis has taken a huge toll in the global airline industry. The IATA now sees that the airline industry may lose anywhere from $63 billion to $113 billion.