Singapore Airlines to boost digital investment to improve revenue, cut costs

PHOTO: Singapore Airlines

SINGAPORE - Singapore Airlines Ltd will invest "hundreds of millions" of dollars in digital technology over several years as part of a broader transformation designed to remain competitive against global rivals, its chief executive said on Monday.

The investment is aimed at boosting revenue and reducing maintenance costs and travel delays, CEO Goh Choon Phong told media, adding that the carrier would tie up with four Singapore research agencies.

"Competition has become much more intense and we are very mindful that we need to reinvent ourselves and find new ways to distinguish (Singapore Airlines) from others in order to stay ahead of our competition," he said.

Goh declined to provide more detailed figures or an exact timeline for the investment plans, which he said had already begun.

Airlines around the world are looking to harness financial benefits from their data collection to help lift revenue at a time of low ticket prices.

Other initiatives the premium Asian carrier has announced so far as part of the three-year transformation programme include adding more seats to its Airbus SE A380s, shifting some routes to low-cost carrier Scoot and merging the finance teams of the flagship airline and its short-haul arm SilkAir.

This is what Singapore Airlines' new A380 looks like

  • Singapore Airlines (SIA) picked up its first Airbus 380 that features brand new seats, in-flight entertainment screens and other cabin products.
  • The product upgrades are the first for SIA's superjumbo since the airline started flying the double-decker jet 10 years ago.
  • The reconfigured cabin in the superjumbo has an increased emphasis on premium economy. 
  • Of the 471 seats, there are six ultra-first class suites, 78 in business class, 44 in the premium economy cabin and 343 economy seats.
  • SIA's current A-380s have up to 441 seats each, with 36 premium economy seats and 333 economy class seats.
  • SIA, which will receive another four new A-380s by the middle of next year, will be progressively retrofitting 14 existing A-380s to ensure a similar product across the fleet.
  • The upgrading works being done by Airbus will be completed by the end of 2020.
  • SIA's new A-380 will be deployed first on the Singapore-Sydney route next Monday.
  • The aircraft departed at 2pm yesterday for Changi Airport from Blagnac Airport in Toulouse, France.
  • It had almost 100 passengers on board, including SIA and Airbus staff and partners, as well as journalists,
  • Before the flight could take off, the aircraft had to pass two rounds of checks by Civil Aviation Authority of Singapore (CAAS) officials.
  • On top of the new A-380s that SIA will be collecting in the coming months, the airline also has 48 more A350-900s on order.
  • The A-380 product upgrades and the introduction of new, more efficient aircraft are part of SIA's strategy to grow market share and boost earnings.
  • A private bedroom suite inside the new Airbus A380 aircraft.
  • A private bedroom suite inside the new Airbus A380 aircraft.
  • Economy class seats in the new A380.
  • The galley area of the new A380.
  • Singapore Airlines A380 new Premium Economy.
  • Singapore Airlines A380 new Premium Economy.
  • Singapore Airlines A380 new Economy seats.
  • SIA cabin crew greeting guests at the Singapore Airlines A380 Delivery Ceremony at Airbus Delivery Centre at Toulouse, France, on Dec 13, 2017.
  • Singapore Airlines cabin crew, at the Singapore Airlines A380 Delivery Ceremony at Airbus Delivery Centre at Toulouse, France, on Dec 13, 2017.
  • Singapore Airlines cabin crew, at the Singapore Airlines A380 Delivery Ceremony at Airbus Delivery Centre at Toulouse, France, on Dec 13, 2017.
  • Singapore Airlines pilots and cabin crew, at the Singapore Airlines A380 Delivery Ceremony at Airbus Delivery Centre at Toulouse, France, on Dec 13, 2017.
  • Singapore Airlines pilots and cabin crew with the new plane.
  • Singapore Airlines cabin crew boarding the new plane.
  • Exterior of the new plane.
  • Airbus Delivery Centre at Toulouse, France.
  • Exterior of the new plane.
  • SIA and Airbus also jointly run a pilot training centre in Singapore.
  • Pilots wave from the cockpit of a new Airbus A380 aircraft for Singapore Airlines before taking off.
  • Airbus Chief Executive Tom Enders and Executive Vice President of Commercial at Singapore Airlines Mak Swee Wah (R) attend a ceremony during the delivery of the new Airbus A380 aircraft to Singapore Airlines at the French headquarters of aircraft company Airbus in Colomiers near Toulouse, France.
  • Engine of an A380 inside Airbus Facility Centre at Toulouse, France.
  • Nose of an A380 inside Airbus Facility Centre.
  • Nose of an A380 inside Airbus Facility Centre.
  • Member of the media taking selfies in front of the wheels of the Singapore Airlines New A380.
  • Exterior painting of the new plane in progress.
  • Wheels of the new A380.
  • Exterior painting being done on a new A380 for SIA.
  • Exterior painting being done on a new A380 for SIA.
  • An engine of the new Airbus A380 aircraft.

The airline, like its Hong Kong-based rival Cathay Pacific Airways, has been struggling against mounting global competition from Chinese and Middle Eastern rivals and low-cost carriers, without domestic flights to underpin their earnings.

Singapore Airlines said it would invest in automated technology research to lower maintenance costs and decrease aircraft delays, under a collaboration with the Agency for Science, Technology and Research (A*STAR).

National University of Singapore (NUS) will aid the carrier in tackling other business challenges such as revenue management, where it plans to improve forecasting to better understand demand patterns.

The airline's staff will also be invited to pitch digital ideas, with initial grants of $5,000 being given to suggestions deemed worthy of further testing, Goh said.

Singapore Airlines could potentially boost earnings by $800 million a year if it could successfully collect and monetise passenger data, Corrine Png, the CEO of transport research firm Crucial Perspective, forecast in a report published on Jan. 23.

"This will return Singapore Airlines to its glorious days of earning over S$1 billion net profit a year which would be a significant positive share price driver," she said.

Singapore Airlines reported a $360 million net profit in the financial year ended March 31, 2017.

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