SIA expanding reach with airline tie-ups

SIA expanding reach with airline tie-ups

Singapore Airlines is strengthening its partnerships with Virgin Australia and Taiwan's EVA Air.

By giving customers more travel options through the partnerships, SIA is hoping to gain more clout against rival carriers in an increasingly tough operating environment.

In the tie-up with EVA Air, SIA customers can now choose from three daily flights to Taipei, instead of two before. The third service will be operated by the Taiwanese airline but is open to SIA customers as part of a codeshare deal between the two carriers.

Such partnerships are a key part of SIA's strategy to grow its network and reach without having to mount its own flights.

Apart from EVA, the Singapore carrier has a similar tie-up with other airlines including Ethiopian Airlines and Virgin Australia.

Meanwhile, SIA is deepening its partnership with Virgin Australia by boosting its stake in the Australian airline. SIA's ownership of Virgin Australia will go up from 19.8 per cent now to 21.2 per cent.

The two other foreign airline shareholders of the Australian airline, Air New Zealand and Etihad Airways, will also raise their stakes. The deal will need approval from the Australian authorities.

The move is part of a fund-raising exercise by Virgin Australia.

About a month ago, the airline made an offer to small shareholders to buy shares valued at A$350 million (S$397 million).

At the close of the exercise on Thursday, only about a quarter of the shares had been taken up by these shareholders.

As had been agreed earlier, the remaining three quarters of the shares will go to SIA, Etihad and Air New Zealand.

The latest development has not gone down well with Australian national carrier Qantas.

Its chief executive officer, Mr Alan Joyce, has complained for weeks about the growing involvement of foreign airlines in the Australian aviation industry.

This gives carriers like SIA access to traffic rights and markets that should rightly be reserved for genuine Australian carriers, he said.

But spokesman for the Singapore carrier, Mr Nicholas Ionides, said SIA's increased stake demonstrates its support for the ongoing transformation of Virgin Australia and brings more competition to the Australian market which is good for consumers. karam@sph.com.sg


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