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Indeed, it can be said that Singapore Airlines has remained unruffled despite the challenges it has faced and currently facing in the already congested airline industry.
In 2011, the global airlines industry gained a net profit of $8.4b or 2.9% of revenues growth, accumulating net profit of $ 23bn between 2009 and 2011 (IATA, 2012). Air transportation significantly promoted the economic development of a country and the regions. The airline industry is currently one of the vital industries in the world and it is the heart of global transport, hospitality, travel and tourism, which would affect other economies internationally, (Chen, He, Wong, 2013).
The stronger assets and lower financial risk with the many adverse events has gained valuable experiences in the past. It remains as one of the best airlines in the world. A poorer global economic condition and strong competition could have contributed and improved bottom-line as it recovered at 2011. SIA had considerable facilitation to operate and expand its business. The one-tier system and tax treaties would enhance any commercial viability for expansion, (Chen, He, Wong, 2013).
SIA has won the World’s Best Airline award from Condé Nast Traveler 21 out of the 22 times it has been awarded and Skytrax’s Airline of the Year award three times over the past decade. What’s not so well known is that despite the quality of its services, SIA is also one of the industry’s most cost-effective operators. From 2001 to 2009, its costs per available seat kilometer (ASK) were just 4.58 cents. According to a 2007 International Air Transport Association study, costs for full-service European airlines were 8 to 16 cents, for U.S. airlines 7 to 8 cents, and for Asian airlines 5 to 7 cents. In fact, SIA had lower costs than most European and American budget carriers, which ranged from 4 to 8 cents and 5 to 6 cents respectively, (Heracleous and Wirtz, 2010).
References
Chen, Zhao Hai, He, Muzi and Dr. Wong, K.C. (2013). Journal of Contemporary Management:
A Case-based Analytical Study on the Strategic Evaluation of Common Equity
Performance of SIA in a Global Organic Environment. Retrieved from:
http://www.bapress.ca/jcm/jcm2014-1/1929-0128-2014-01-51-12.pdf
Heracleous, L., & Wirtz, J. (2010). Harvard Business Review: The Globe: Singapore Airlines’
Balancing Act. Retrieved from:
https://hbr.org/2010/07/the-globe-singapore-airlines-balancing-act.
