Singapore Airlines Case Analysis

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  • Topic: Airline, Singapore Airlines, Malaysia Airlines
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  • Published : November 30, 2008
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Singapore Airlines – Case Analysis

Situational Analysis
Singapore Airlines (SIA) began with the incorporation of Malayan Airways Limited (MAL) in October 1947.The incorporated companies were the Ocean Steamship Company of Liverpool, the Straits Steamship Company of Singapore and Imperial Airways. The airline's first flight was chartered from the British Straits Settlement of Singapore to Kuala Lumpur in April 1947 using an Airspeed Consul twin-engine airplane.

SIA has remained competitive by being always on the money when it comes to equipment acquisition and the latest in aircraft technologies, as well as the interior aesthetics of the plane and good entertainment of the riding passengers. The airline has been credited with providing the first complementary headphone for passengers. However, despite the Airlines innovation and success in the South East Singapore Airlines Ltd. said its July-September profit fell 36 percent as fuel costs boosted expenditures. The airline warned passenger demand may drop next year.

Problem Statement
The net profit for Singapore Airlines’ was 324 million Singapore dollars ($219 million) in the fiscal second quarter in 2008, down from SG508 million in the same period a year ago, the carrier said in a statement, "Although advance bookings for the immediate next quarter are holding up reasonably well, there are signs of weakness beyond that," the company said. "Fuel prices have retreated but fuel remains the biggest single item of operating expenditure (Business Week)".

Although, revenue increased to ten percent to SG4.4 billion ($3.0 billion) for the quarter, caused by higher passenger traffic, expenses also increased twenty percent to SG$4.1 billion ($2.8 billion).Singapore Airlines is very reputable in the Southeast and are known for their fair prices and accommodated environment.

Singapore Airline is also facing increasing competition from low-cost Airlines Valuair and AirAsia. In order to curb costs Singapore...
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