SIA cuts non-stop all-business NY flights

SIA cuts non-stop all-business NY flights

SINGAPORE - Singapore Airlines's (SIA) decision to phase out the world's longest direct commercial flight next month - its non-stop all-Business Class service from Singapore to Newark Liberty International Airport in New Jersey - could see it losing market share in the competitive US-South-east Asia segment. But it may not be all bad news where the bottom line is concerned, especially as the airline aggressively grows its network in the buoyant Asia-Pacific market.

In 2004, SIA first started operating the near-19 hour service to New York, which covers over 15,300km, using the long-range, four-engine Airbus A340-500 aircraft. After initially starting out with a mix of business and premium economy seats, it later converted the flight to an all-Business Class configuration with 100 seats.

SIA also used to operate the world's second-longest flight, an all-Business Class direct service between Singapore and Los Angeles, which saw its last flight take off earlier this month on Oct 20. The last direct Singapore-Newark flight departs on Nov 23.

Airbus is due to acquire SIA's five A340s as part of a deal inked last year where the airline ordered more A380s and A350s.

"Retiring our A340-500s and removing them from service is in line with Singapore Airlines' long-standing policy of maintaining a young and modern fleet," said an SIA spokesman, adding that high and volatile fuel prices posed challenges for ultra-long haul operations.

The airline, which bumped up services to Houston from five times weekly to daily between May and August this year, continues to explore other avenues to enhance its US services.

"Following the financial crisis, the world has changed. Demand for air travel has also changed," said UOB Kay Hian's aviation analyst K Ajith.

Such long-range flights are "nearly impossible" to operate profitably at current fuel prices, Brendan Sobie, chief analyst for CAPA - Centre for Aviation, wrote in a recent report. The ultra-long range flight is fuel-intensive and with just 100 seats - even premium seats - the yields may not justify the operating costs. According to the International Air Transport Association (Iata), the average fuel bill for this year is hovering at US$124.50 per barrel.

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